Crypto Market Fails to Recover Ahead of Christmas Eve

Despite the festive season approaching, the crypto market remains subdued, with Bitcoin, the flagship cryptocurrency, struggling to reclaim the $100,000 mark. Historically, the period around Christmas Eve has seen most crypto assets rally, reaching new all-time highs and contributing to the festive mood. However, this year’s market response has been lackluster, leaving investors uncertain about the market’s direction.

Bitcoin and Other High-Cap Coins in the Red

Bitcoin reached a new all-time high of over $108,000 just six days ago but has failed to stay above $100,000 for the past three days. The flagship cryptocurrency has been down 8.3% over the past week, trading at $95,904 per coin. Other high-cap coins, such as Ethereum and XRP, have also experienced notable declines, with Ethereum falling by 15.6% and XRP by 7.8% over the past seven days.

Meme Coins and Other Assets Plummet

The leading meme coin by market cap, Dogecoin, has plummeted by over 21% in the past week, with its price currently hovering around $0.316. Solana has also fallen below the $200 mark, tanking by 16% to a current price of $184. The weekly crypto charts of other leading crypto assets are also awash in red, with the broader market still down 14% from its all-time high of $3.9 trillion, currently standing at $3.41 trillion.

Post-Christmas Rally: A Glimmer of Hope

Despite the recent market downturn, a post-Christmas rally, often dubbed the ‘Santa Claus rally,’ could bring festive cheer to traders. Historically, this rally has occurred 8 out of 10 times over the past decade, from 2014 to 2023, with the overall crypto market cap recording gains ranging from 0.69% to 11.87%. However, this time around, the chances of a post-Christmas rally hinge largely on Bitcoin, which is currently dictating the market’s direction.

Bitcoin’s Recovery Potential

As previously reported, Bitcoin remains undervalued according to the MVRV-Z score, which currently sits below historical thresholds associated with overvaluation. This leaves room for recovery in the coming weeks. Market pundits have repeatedly pointed out that corrections are normal during prolonged Bitcoin rallies. Experts from VanEck speculate that Bitcoin will re-enter its price discovery phase following the recent correction and expect BTC to hit as high as $180,000 by Q1 2025.

Tips for Investors:

  • Keep a close eye on Bitcoin’s price movements, as they are currently dictating the market’s direction.
  • Consider the historical data on post-Christmas rallies and the potential for a market rebound.
  • Stay informed about market trends and expert predictions to make informed investment decisions.

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