Crypto and bitcoin – Christmas rally or nothin’ special this year?

Crypto outlook for the holidays, 23 Dec 2024 – 01 Jan 2025🎄

Bitcoin futures remain range-bound as we head into the holiday season, trading between $92,000 (support) and $98,000 (resistance). While the crypto community often speculates about a “Santa rally,” recent developments in broader financial markets suggest caution. The pullback in the stock market, which began after the FOMC meeting on December 19, could weigh on sentiment in the crypto market, lowering the chances of a holiday rally.

Last year, similar hopes for a year-end surge ended in disappointment, with Bitcoin futures posting a 1.7% decline during the Christmas week. This historical context, combined with the latest market turbulence, underscores the importance of monitoring key levels as guidance, especially during this uncertain trading period.

Market sentiment and key levels to watch 🔍

Bitcoin futures are currently trading just below today’s Volume-Weighted Average Price (VWAP) of $95,000, which serves as a critical reference for intraday trends. Trading below VWAP indicates selling pressure, adding further weight to the cautious tone in the market.

Key levels provide much-needed structure in this unpredictable environment:

• Support at $92,000: A break below this level could trigger further downside, signaling that sellers remain firmly in control.
• Resistance at $98,000: A breakout above this level would likely attract buying interest and potentially spark a rally toward the psychological milestone of $100,000.

Despite the current sentiment, Bitcoin has a history of surprising the market. These key levels serve as critical waypoints to help traders navigate potential volatility, whether the price moves up or down.

Crypto bottom line for Christmas: how to look at the holiday uncertainty 🚨

The chances of a crypto Santa rally appear lower this year, with broader market sentiment leaning cautious after the stock market’s recent hiccups. However, Bitcoin remains notoriously unpredictable, and traders should prepare for either a breakout or a breakdown as it approaches the boundaries of its current range.

Without any significant move made by the crypto king, it is unlikely to expect any special action from alt coins.

Whether Bitcoin moves up or down, $92,000 and $98,000 provide critical guidance for interpreting the next steps in this volatile market. Traders are encouraged to watch volume, price action, and the VWAP at $95,000 for confirmation of a move. Patience and disciplined risk management will be key during this holiday period. Always invest in crypto and/or trade BTC at your own risk only.

This article was written by Itai Levitan at www.forexlive.com.