Bitcoin [BTC] surprised the market over the previous week with its unexpected trading patterns. On Christmas Eve, BTC witnessed a significant surge, climbing from $92k to $99k.
This initial price movement generated hope among investors for a strong performance heading into the new year. However, Bitcoin’s price has since been extremely volatile, dropping to a low of $91,315.
Given the current market conditions, analysts are speculating about how BTC will behave as we enter 2025. Alphractal suggests that historical cycles indicate a potential sharp decline in Bitcoin’s price in the lead-up to the new year.
Examining Bitcoin’s Historical Price Fluctuations
An analysis by Alphractal reveals that Bitcoin has exhibited varying behaviors between Christmas and New Year’s Eve in the past.
Bitcoin has seen both surges and downturns during this period. From December 25th, BTC has dropped by 6.01%, falling from $99,881 to $93,879 at the time of writing.
Alphractal’s analysis suggests that this decline could signal a negative trend as we step into the new year, aligning with historical patterns.
Historically, certain years, such as 2012-2013, 2014-2015, 2017-2018, 2019-2020, and 2021-2022, exhibited negative variations in Bitcoin prices, characterized by year-end volatility and uncertainties.
Nevertheless, there have been instances of positive performance or minor fluctuations, like in 2013-2014 and 2015-2016.
Given the current 6% decline since Christmas, the precedent of negative patterns suggests that the end of 2024 and the beginning of 2025 may follow a downward trajectory.
Future Outlook for BTC
Although historical trends may not always repeat, it is crucial to consider other market signals regarding Bitcoin’s prospects approaching the new year.
As per CryptoCrypto’s analysis, Bitcoin is presently consolidating, and investor sentiment appears bearish due to concerns about the crypto market’s direction.
For instance, Bitcoin’s long-term holder SOPR has decreased from 4.5 to 1.8, indicating reduced confidence among long-term holders who are willing to sell at a loss, potentially exerting downward pressure on prices.
Furthermore, Bitcoin’s Price Daily Active Addresses (DAA) divergence has remained negative, implying a decline in active addresses and market participants. This situation suggests that the current price may be inflated and could correct to meet actual demand.
In summary, Bitcoin might witness a downturn as we enter 2025. If historical trends persist, Bitcoin could drop to $91,500. However, if buyers anticipate a post-new year rally as market participants return, Bitcoin might aim to reclaim $95,400.