Crypto investors’ hopes for a Christmas price rally could be realized if a few factors fall into place, YouHodler’s chief of markets Ruslan Lienkha believes.
Global Economy
Despite ongoing uncertainty in financial markets regarding the future of the global economy, Lienkha said there is a reasonable chance we may see a Christmas rally this year. The decline in oil prices may reflect concerns about global economic growth, but the rise in gold prices indicates a strong demand for hedging against potential risks.
The recent interest rate cuts by major central banks to stimulate their economies are a positive signal. The upcoming U.S. elections, while adding volatility, are drawing increased attention from traders and investors. While uncertainties remain, the overall market sentiment is positive, suggesting that financial markets could benefit from the beginning of an easing cycle and continue to grow until 2025.
US Presidential Election
“I believe financial markets, including crypto, are poised for growth in the coming months,” Lienkha said. “The outcome of the U.S. elections will likely have a significant influence on the pace of this growth. In particular, a potential Trump victory could provide a substantial boost to the crypto market, as he is viewed as a crypto-friendly politician.”
Recent Market Movements
Despite some recent selling pressure in global equity markets, Lienkha said markets have seen strong performance from Bitcoin, with attempts to decouple and grow against equity indices. Decouple in this context means that Bitcoin’s price movements are becoming less correlated with traditional equity markets, which is a positive sign for the cryptocurrency.
“As a result, we are likely to see a new BTC all-time high in the zone of 80k this quarter, especially given the anticipated positive performance in equity markets,” Lienkha predicted. “ETF capital flows are also playing a key role, as they make crypto investments more accessible to retail investors who may not directly engage with blockchain technologies.”
“Additionally, growing interest from institutional investors and corporations in Bitcoin is a positive factor. Notably, companies like Microsoft are reportedly considering holding BTC on their balance sheets, following the example of firms like Tesla and MicroStrategy.”
Bitcoin has generally maintained a sustainable upward trend since early 2023, a movement that could extend through 2025. However, it’s important to note that potential economic challenges in the U.S. might disrupt this trajectory. Periods of correction and accumulation, as seen this year, can sometimes last up to six months, with the price consolidating from March onward. It’s worth highlighting that institutions and major market players play a significant role in driving the long-term trend, whereas short-term fluctuations tend to be influenced by retail sentiment.
From a technical analysis standpoint, Lienkha said Bitcoin’s price recently formed a flag pattern over the past six months, which often signals trend continuation. The current breakout indicates the continuation of the primary trend, setting a new all-time high as the next objective. The psychological level of around $80,000 may act as a point where investors start to take profits, potentially introducing some selling pressure.
“On the fundamental side, selling pressure in the global equity market may affect Bitcoin, as any significant equity correction will likely increase volatility in the crypto market, potentially complicating Bitcoin’s upward trajectory,” Lienkha concluded.