After a big dump of about 30% from the peak in October, Bitcoin is currently stabilizing around $87,000 after a five-day Rebound, boosting market confidence. However, analysts warn that even with improvements in the macroeconomy and growing interest from Wall Street in risk assets, Bitcoin's next major breakthrough may have to wait until 2026.
Koinly CEO Robin Singh stated that Bitcoin has been struggling to return to the $90,000 mark, but the process is slower than most market participants expected. The market is gradually entering the typical “Christmas hibernation period,” with a lower likelihood of explosive volatility before the end of the year.
Global stock markets have rebounded, and officials have hinted that the Federal Reserve may cut interest rates in December, boosting market expectations and raising the total market capitalization of cryptocurrencies to $3.1 trillion. According to DefiLlama, $129 million flowed into the U.S. spot Bitcoin ETF on Tuesday, but nearly $3.6 billion has been withdrawn cumulatively in November, making it the month with the most severe sell-off since February.
Artificial intelligence and tech stocks rebounded this week, indicating an overall rise in risk appetite. Singh pointed out that if Bitcoin can recover to $90,000 in December, it will improve trader sentiment and reduce concerns about a “cryptocurrency winter.” However, historical data shows that since 2013, Bitcoin's average return in December has been less than 5%.
Wintermute OTC trader Jack Ostrovsky is bearish on December trends, stating that the market's expectation for a “Christmas rally” has been priced in. Deribit data shows that options market traders expect Bitcoin to potentially reach $118,000 but find it difficult to break through.
On the macroeconomic front, the U.S. federal government shutdown has led to delays in the release of economic data, but recent signals from Federal Reserve officials lean towards easing. The FedWatch tool shows an approximately 83% probability of a 0.25% rate cut in December, with Polymarket investors predicting as high as 84%. The next FOMC meeting is scheduled for December 9-10. Bitcoin remains stable in the short term, but investors are still cautious, with market sentiment closely tied to policy signals. (DL News)
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