• BTC/USD has been moving in a tight range recently.
  • Santa's rally may take the price to a long-term resistance line.

Bitcoin (BTC) has been paralyzed at $7,200 since Thursday. The first digital asset attempted a recovery towards $7,600 at the beginning of the week. However, the upside momentum proved to be unsustainable as the price retreated to the lower boundary of the recent consolidation channel.  At the time of writing, BTC/USD is changing hands at $7,202, mostly unchanged both on a day-to-day basis and since the beginning of Friday. 

Low volatility and non-existent trading activity confined the market to tight ranges, but the situation may change ahead of the weekend. We are moving towards the holiday season, which is often characterized by low liquidity conditions. It means that the market may be vulnerable to sharp exaggerated movements. Many traders might start taking their money off the table to avoid losses. 

Historically, Bitcoin tends to grow ahead of Christmas. This trend is often referred to as Santa's rally. However, there is no guarantee that this year the history will repeat.

BTC/USD: the technical picture

If we zoom out to the weekly chart, we can clearly see that BTC/USD is moving within a downside channel. In October, the similar consolidation pattern of three doji candles ended in a strong recovery, though the trend remained unbroken. This time we may see similar momentum with the price recovering towards $9,000-$9,100 during the pre-Christmas week. This movement will qualify for Santa's rally. However, we will need to see a sustainable move above $9,150 (the sloping trendline) for the recovery to gain traction in the long run and put the current bearish trend at risk.

On the downside, once $7,000 is broken, the sell-off may extend towards $6,550. This support area is created by a combination of the lower line of the weekly Bollinger Band and the lowest level of the previous week. We will need to see a sustainable move below this handle for the downside move to gain traction with the next focus on psychological $6,000 and $5,000 (SMA200 weekly).

BTC/USD: the weekly chart

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Cryptos feed

Latest Crypto News

Latest Crypto News & Analysis

Editors’ Picks

Bitcoin rises to new yearly highs while the rest of the crypto market follows

Bulls are finally making a comeback into the market and regaining full control of the price across the board. According to the data by CoinMarketCap, a massive $22 billion has come into the market amid Bitcoin’s recovery beyond $13,000.

More Bitcoin News

Zcash is about to have its major protocol update and halving at the same time

A privacy-focused cryptocurrency Zcash is less than a month away from its first-ever halving event that will take place on block 1 046 400, around November 18. 

More Zcash news

ADA flashes sell signal as bears get ready to take control

Cardano found support at the $0.076 support line and bounced. As of press time, ADA is trading for $0.107 and is consolidating between 100-day SMA ($0.114) and 50-day SMA ($0.097). 

More Cardano News

LINK, OMG, and THETA spike 10% over the past 24 hours thanks to PayPal

The cryptocurrency market saw a $20 billion increase in its total market capitalization in the past 24 hours. It is only $6 billion away from the 2020-high on September 1 at $391 billion total. 

More Cryptocurrencies News


Bitcoin: BTC ready to escape from the range; bulls have $12,000 in mind

Bitcoin has been gaining ground amid positive fundamental developments. The flagship cryptocurrency is ready to break free from its current range and proceed with the recovery towards $12,000. 

Read the weekly forecast