As Bitcoin passes a significant milestone, the cryptocurrency market is experiencing a new wave of excitement following the New Year's rally.$BTC
Recent developments suggest that Bitcoin’s gains, along with traders’ resilience to market volatility, are increasing bullish expectations.
“This bounce occurred as price retested its systematic trend… The underlying momentum is very strong,” Trader Skew commented.
On December 25, Bitcoin (BTC) was trading at around $98,000. As traders joined the market activity with the holiday season, Bitcoin’s gains and resilience drew attention. The volatility surrounding Bitcoin was observed to have decreased, and traders made significant daily gains of around $4,000 during the period commonly referred to as the “Christmas rally.” Popular trader Skew noted that the relative strength index (RSI) was showing a bullish divergence, emphasizing that this could be a sign of upward momentum.
Technical indicators suggest that Bitcoin is at a critical juncture. Keith Alan, co-founder of trading resource Material Indicators, noted that BTC is testing key daily simple moving averages (SMAs). The 21-day SMA is around $99,600, while the 50-day SMA is around $94,650. Alan asks traders: “Which one do you think will break first?” This uncertainty underscores how these indicators shape market sentiment.
Despite the holiday gains, the market is facing significant challenges. US spot Bitcoin ETFs saw a phenomenal $1.5 billion outflow for the fourth day. Data from Farside Investors indicates a massive $338.4 million outflow on Christmas Eve alone. These outflows call into question the sustainability of the current rally and raise concerns among market analysts.
But not everything is doom and gloom. Onchain analytics platform CryptoQuant has observed a surge in interest among short-term investors, particularly from South Korea, which is known for the Korean Premium in Bitcoin prices. In a Dec. 24 Quicktake blog post, contributor Joo Hyun Ryu noted that in just one week, there was a 3 percentage point increase in the share of short-term investors.
