Previous market cycles for beef have seen a measurable correction before the year-end rally – and, if history does not change, it could be back on paper.
We’ve definitely tested the correction: Bitcoin (BTC) hit an all-time high of around $ 69,000 on November 10 and has since dropped about 17% to its current level.
Some mainstream media outlets, such as Forbes, have taken the view that the current pullback has brought the markets back into bearish territory with the rather unpleasant headline “Has Bitcoin Got Bear Market After 20% ATH Drop?” In the article on Tuesday.
But the November drop was actually the weakest correction of 2021, overshadowed by Bitcoin’s massive 53.4% correction in the three months from April to July. The last correction in September was the second deepest, reaching 37% of the April ATH.
In a Week On-Chain report released on Monday, analytics provider Glassnode said the current correction is simply “common practice for Bitcoin users,” suggesting it could end soon. She also stressed that the current market correction “will actually be the least severe in 2021.”
Aside from the stock market plunge from the flare-up of the COVID-19 Omicron variant, some think we are on our way to meeting Santa Claus. This is the concept of the stock market where prices rise during the last five trading days of December and the first two trading days of January. However, this has also been seen in cryptocurrency markets in previous years and is often a shortcut to price increases prior to December.
Last December, bitcoin prices rose 47% month-over-month, while December 2017 saw an 80% rise to a new all-time high at the time. Both were in the beef markets like they are today.
At the time of writing, BTC is trading at just over $ 57,000, so a Santa Claus rally similar to last year’s could push prices up to $ 80,000 by the end of the year.
Nikita Rodinia, co-founder of 8848 Invest, is also confident in meeting with Santa Claus and comments:
“Despite the apparent setbacks so far, Bitcoin is still on track to end the year at $ 70,000 per coin, and if that milestone is reached, we may see the coin hit $ 75,000 in early 2022 before we’ll get a major correction. ”
Interestingly, Ether (ETH) is currently outstripping the pace. According to CoinGecko, the ETH / BTC ratio is the highest since mid-May at 0.082 BTC for 1 ETH or about 12 ETH for 1 BTC. This could lead to ETH driving further price increases in December.
RELATED: Forget Milk and Cookies, Santa Accepts Bitcoins This Holiday Season
After diving deep into chain patterns, Glassnode concluded that bitcoin investors are in more profitable positions than they were during the September correction.
“Both long-term and short-term holders have better bids than the September correction, which can usually be viewed on a price basis.”
Glassnode reported that the total share of profitable placements by short-term holders has increased 60% since September. He summed up: “In a bull market, this combination usually provides a fairly constructive short-term outlook.”
So the hope for meeting Santa Claus began to grow. This issue at the end of the year can be attributed to a number of factors, such as celebrating the holidays and increasing liquidity through Christmas bonuses.
However, the new variant of the Omicron coronavirus could weaken the party if it has a significant impact on global financial markets and new locks are introduced or appear likely. Investors may remain on the sidelines until further notice until more is known about the new virus strain, according to Nasdaq.
On the other hand, Bitcoin traded for just $ 18,857 last year.