Seasonal Trends Drive Bitcoin Dip, But Altcoins Show Promise for Rise
Summary:
Bitcoin (BTC) experienced another dip on December 26th, falling 2% to $42,200, its lowest in a week, due to seasonal trends and end-of-year profit-taking activities. While the majority of cryptocurrencies struggled, Binance Coin (BNB) and Solana (SOL) showed strong weekly performances. Experts suggest that the trend indicates a potential upcoming surge in altcoin market values.
On December 26th, Bitcoin (BTC) experienced another dip, believed to be due to the effect of seasonal trends on its price. Data obtained from Cointelegraph Markets Pro and TradingView revealed a 2% drop of BTC to $42,200 - the lowest it had been in almost a week. Amidst the holiday season, Bitcoin investors were met with no holiday surprises or a "Santa rally," and cryptocurrency markets continued to flounder as Wall Street resumed.
Trading resource Material Indicators identified the culprits behind Bitcoin's end-of-year difficulties as the harvesting of tax loss and profit-taking activities. The BTC bulls, they pointed out in a post on X (formerly Twitter), would face increased resistance as a result. They also pointed out BTC's 21-day simple moving average, which stood at $43,115 - about $400 more than the spot price at the time of writing.
Keith Alan, the co-founder, amplified the importance of this 21-day trendline as a supportive factor for Bitcoin in the recent months. He tweeted about waking up to a Bitcoin value of under $43,000 and emphasized on the need for the bulls to reclaim it in order to sustain the rally.
BTC/USDT order book liquidity data from Binance, the world's largest cryptocurrency exchange, didn't offer much encouragement and showed bids around $37,000 and lower. Skew, a popular trader, also commented on order book trends, suggesting that the market was gearing up for a possible further dip.
On a brighter note, not all major cryptocurrencies ended the year on a low note. In stark contrast to Bitcoin and the top altcoin Ether (ETH), Binance Coin (BNB) and Solana (SOL) maintained a stellar weekly performance. BNB/USD and SOL/USD were up 19.5% and 56.8% respectively over the past seven days at the time of writing. ETH/USD recorded a slight improvement of 1.6%.
Solana enjoyed benefits from increased gas fees and airdrops which took its value to almost $126 on Christmas Day, a high it had not seen since April 2022. These developments have fueled hope amongst traders that altcoins may have their moment of glory even as Bitcoin loses momentum.
Michaël van de Poppe, founder and CEO of trading firm MN Trading, further solidified this belief. He noted that the total market capitalization for altcoins is finally breaking out of a 500+ days range and predicted a likely 2x increase in altcoin market capitalization in Q1.
Please note that this article does not offer any investment advice or recommendations. Each investment and trading proposition involves risks, and readers are encouraged to carry out their own research before making any decisions.
Published At
12/26/2023 5:52:20 PM
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