As the year-end approaches, friends in the crypto circle are always looking forward to the 'Christmas market'! However, this year's market performance, compared to data from the past few years, seems to make everyone reconsider this long-anticipated 'Christmas miracle'.
The market is adjusting, and market confidence still needs to be restored.
Recently, Bitcoin's price has plummeted from a high of $105,000 to $90,500. While this pullback startled many, on-chain data shows that a large amount of BTC was 'absorbed' at the key support level of $97,500. This indicates that bulls have not completely given up and are still working to defend.
The market is still in a bull market cycle; although the adjustment has made market sentiment somewhat weak, it does not mean the bull market is over.
The Federal Reserve's hawkish remarks may increase market pressure.
The recent hawkish statements from the Federal Reserve have led the market to worry that year-end liquidity may tighten further. The US Dollar Index (DXY) has been rising, directly suppressing the cryptocurrency market.
In this environment, the market's risk appetite has weakened, which means the explosive potential of the 'Christmas market' may not be as expected.
Liquidity is low, and institutions are entering holiday mode.
Data shows that liquidity before Christmas is usually low, especially as institutional investors in North America and Europe gradually enter holiday mode, leaving the market dominated by retail investors.
If there are no major positive news like ETF approval, the market is more likely to show fluctuations, or slight volatility.
Three potential trends for this year's Christmas market.
Fluctuating market: The main theme remains consolidation.
As the market has just experienced a rapid adjustment, market sentiment needs time to recover.
Therefore, during the Christmas period, Bitcoin is likely to fluctuate between $95,000 and $105,000, lacking the momentum for a large-scale breakout.
The Rise of Altcoins: The New Star of the Christmas Market
Whenever the market adjusts, funds often flow into altcoins.
So, if altcoins perform actively during the Christmas period, it may usher in a wave of 'local Christmas market'. Especially strong coins like Ethereum (ETH) and Solana (SOL) may become 'leaders' in the market, attracting funds.
Positive news triggers a rise: good fortune may be just around the corner.
If an ETF is approved or other major institutions enter the market, there is still potential for an explosive Christmas market.
The bullish sentiment this year is still present, and a fund-driven rise could still become a driving force. Once the market is ignited, it may trigger a wave of explosive trading.
Investment Advice
In the short term, although the possibility of market fluctuations is high, Bitcoin's bottom support remains strong. Therefore, for conservative investors, it may be worth considering a phased layout, focusing on buying opportunities around $97,500 for Bitcoin, while also keeping an eye on low buying opportunities for strong coins like ETH and SOL.
At the same time, remember to pay attention to some fundamentally strong altcoins, as there may be local market movements.
