Reviewing the Historical Santa Claus Rally: Will It Happen Again This Year?

The term 'Santa Claus Rally' originally refers to the market performance during the last five trading days of the year and the first two trading days of the next year.

How does the 'Santa Claus Rally' manifest in the crypto market?

In years without a 'Santa Claus Rally', the crypto market before Christmas in 2017 experienced the largest pullback, declining by 12.12%. Aside from this, the pullbacks in the crypto market before Christmas were relatively small, ranging between 0.74% and 1.25%.

Meanwhile, the market pullbacks after Christmas in 2021 and 2022 were 5.30% and 1.90%, respectively.

It is worth noting that in the past 10 years, there were only 3 years where the crypto market experienced a 'Santa Claus Rally' both before and after Christmas. These 3 years are:

2016, when the total market capitalization of the crypto market increased by 11.56% before Christmas and 10.56% after Christmas.

2018, in which, despite the market being in a correction throughout the year, moderate increases of 1.31% and 4.53% were recorded before and after Christmas, respectively.

2023, under the backdrop of a recovering bear market, saw the crypto market rise by 4.05% before Christmas and 3.64% after Christmas.

In contrast, the total market capitalization of the crypto market showed even more extreme performance throughout December. In the past 10 years, there were 5 years where the market overall grew by 16.08% to 94.19% in December. In the remaining 5 years, during pullbacks, the December market decline ranged between 1.73% and 15.56%.

Overall, the 'Santa Claus Rally' in the crypto market is not a stable phenomenon; its performance varies significantly and is difficult to predict.

As an experienced investor in the crypto space, I, Tu Fei, share my experiences and insights. Interested in the crypto space but don’t know where to start? Click on my avatar to view the profile, and let’s witness the moment of miracles together.