Bitcoin and Ethereum could not achieve the year-end momentum expected in December and are preparing to close the fourth quarter with sharp losses. While the period known as the “Christmas rally” in the cryptocurrency market did not occur this time, the weakening of liquidity and the decrease in risk appetite increased the pressure on prices. Bitcoin‘s attempts to break through key levels were met with selling, Ethereum and other large-scale altcoin‘s also moved in the same direction. The resulting picture clearly revealed that the market went into risk-averse mode in the last quarter of the year.
The Fading of the Christmas Rally and the Quarter Closing in Cryptocurrencies
Bitcoin is on track to close December with a loss of approximately 22 percent, marking the weakest monthly outlook since December 2018. Ethereum On the front, the picture is even more severe. The loss in the largest altcoin in the fourth quarter of the year increased to 28.07 percent. The data is based on CoinGlass, which is closely watched by market participants.
christmas rallyIt refers to the upward trend traditionally seen in the last week of the year and the beginning of January, resulting from low liquidity and portfolio balancing effects. However, this dynamic did not work in the last month of the year. Cryptocurrencies encountered leverage reductions and rapid profit taking as we entered the holiday period.
This is a weak close cryptocurrencyIt also brought back to the agenda the historical dependence of s on end-of-year trends. While the strong December performance seen in previous cycles provided momentum for the first months of the new year, the current outlook looks more like a position reset. The fourth quarter charts show that caution prevails, not the desire to take risks.
Divergence Between Cryptocurrency and Precious Metals
The fragility of cryptocurrencies has made the stark contrast with precious metals more visible. Goldrose to new record levels due to interest rate cut expectations and geopolitical tensions. Silver While making a strong rise, platinum It has recently tested new peaks.
The performance of gold was determined by the steady purchases of central banks and the increase in ETF demand. While investors turn to reserve assets in times of uncertainty, precious metals directly benefited from this trend. In such an environment, cryptocurrencies appeared far from the safe haven perception.
Bitcoin, on the other hand, had difficulty maintaining its gains before a wide-scale risk appetite emerged, even if there were signs of relaxation on the macro basis. Volatile bond yields and erratic dollar movements have created an investor profile that prioritizes capital preservation. The sales, which intensified in the last days of the year, especially in the US trading sessions, indicate that funds are clearing their positions during the holiday period. The first test of the new year will be whether Bitcoin can defend its current support zones.
