Bitcoin Aims for Year-End Rally After Difficult October

Historical trends in crypto markets show that declines often precede a rebound. Bitcoin's mixed performance in October could mark just a pause before a return to stability by the end of the year. The market has already benefited several times from a seasonal phenomenon known as the Santa Claus Rally: a moderate rise in December, often driven by renewed confidence and lighter trading activity. This pattern suggests that bitcoin's recent weakness may only be temporary, leaving room for a possible rebound.

October setback and return to stability

After hitting an all-time high in early October, bitcoin's expected rebound lost momentum, leading to a sharp fall later in the month. Since then, prices have stabilized, suggesting a possible market bottom. Investors are now hoping for a jump by December. According to Coinglass, bitcoin has closed six of the last eight Decembers in the green, with gains ranging from 8% to 46%.

This stabilization results in a return of BTC to around $106,000, a sign that buyers are returning after a period of massive sales. According to Nick Ruck (LVRG Research), the market is moving from panic to more thoughtful buying, led by long-term investors. Expectations of Fed rate cuts and increased institutional interest support hopes for a strong end-of-year rally.

Julio Moreno (CryptoQuant) also confirms an increase in demand on the spot market: weekend buying activity saw its first real peak since early October. This renewed interest, combined with the drop in precipitous sales, could reinforce the scenario of a seasonal rally, driven by the calm of the holidays and the renewed confidence of the market.

Trump’s “tariff dividend” and its effect on bitcoin

Traders are also watching Donald Trump's proposal for a “tariff dividend” of $2,000 per citizen. Augustine Fan (SignalPlus) explains that this plan, inspired by COVID-19 stimulus checks, would inject a new dose of liquidity into the economy.

This measure could benefit risky assets like bitcoin, and market optimism already seems to be pricing it in.

Tariff dividends are reminiscent of COVID stimulus checks, a direct and effective stimulus. Very long-term mortgages will strengthen access to housing while providing capital leverage to the system.

Augustine Fan

Volatility and market dynamics at the end of the year

So what other factors influence the behavior of the bitcoin price? Analysts note that volatility is increasingly determined by market structure and investor activity, rather than short-term speculation.

• Rachel Lin, CEO and co-founder of SynFutures, said future price movements could remain high, influenced more by institutional trading, derivatives and liquidity changes than short-term speculation.
• She highlighted that global liquidity and real interest rates remain key factors to monitor, with bitcoin historically exhibiting a 0.6-0.7 correlation with US liquidity indicators such as the Fed's balance sheet and M2 money supply.
• A slowdown or reversal of monetary easing in response to tariff-related inflation could increase volatility next year.
• On-chain data indicates that small investors are gradually accumulating bitcoin despite a 3% drop in November, after an October marked by particularly choppy trading.
• At the same time, holders of more than 10,000 BTC reduced their positions accumulated during the first ETF inflows, while smaller portfolios, holding less than 1,000 BTC, slowly increased their holdings, helping to partially offset the impact of sales by large investors.

While the Santa Claus Rally usually occurs in December, this year's forecast suggests it could happen again. A year-end bitcoin price surge could lead to further momentum for altcoins, driven by seasonal trends, newfound investor confidence and continued accumulation by long-term holders. However, these expectations remain speculative: bitcoin has still fallen by around 2% since the start of the month.