What to Know
- Historically, the fourth quarter has been the most bullish for bitcoin, with prices up by an average of 85% since 2013.
- The last week of the year tends to see at least a 3% gain on average, but the past five out of six years have seen a decline.
- The current short-term holder's realized price (STH RP) is $84,000, suggesting the bull market is still intact as long as bitcoin stays above this key level.
As 2024 draws to a close, bitcoin (BTC) is not meeting expectations, diverging from its historical trend during the year-end 'Santa rally.' The leading cryptocurrency usually adds about 2.8% during the 51st week, but this week it is projected to drop 11%. Typically, there is a 3% gain in week 52, but in five of the last six years, the BTC price actually fell. Hence, the outlook this year appears bleak.
The timing for a 'Santa rally' varies but generally spans late December into early January. This fourth quarter, which has historically been among bitcoin's strongest, is showing an underperformance. Since 2013, BTC has risen an average of 85% in the last three months of the year, but this year it’s below 50%.
The recent downturn resembles early 2021, albeit a bit late for Santa’s usual arrival. On January 8, 2021, bitcoin hovered around $40,000 but dropped to $30,000 by January 27, showing a 25% decline. However, that drop occurred during a bullish period that started near $10,000 in December 2020 and peaked in November 2021 at $70,000.
Currently, the BTC price remains above the short-term holder's realized price, which reflects the average price for coins moved within the last 155 days. This is typical behavior for BTC during bull markets. The present STH RP is $84,000, indicating that as long as it remains above this level, the bull market stays in play.
