Crypto Santa Claus Rally Hopes Fade as Tech Stocks Slump
In 4 out of every 5 Christmas holidays going back to 1950, US stocks have pumped as investors pile some extra savings into capital markets. But financial markets don’t get this tailwind every year.
This year, the Nasdaq Composite and Bitcoin’s price rallied on Christmas Eve and Christmas Day, but a Grinch of a pullback in the latter half of the week threatens to steal the Santa rally.
Santa Claus No Show For Stocks, Crypto
Bitcoin’s price was down over 2% for the 7-day period by lunchtime on Sunday in San Francisco. That’s despite edging up 0.8% for the elapsing daily window with markedly declining 24-hour trade volume.
Meanwhile, Ethereum managed to pull a 1.5% daily candle out of the slow week, mostly on some market price gains on Friday and Saturday. Santa wasn’t completely absent, however, for BNB (with an 11.5% 7D candle), Solana (+8%), and Toncoin (+11%).
But Fantom (FTM), Ethena (ENA), and Ondo (ONDO) saw steep selloffs for the week after having too much egg nog earlier in December.
Everything from Nvidia shares to Ethereum tokens was cooling off Saturday from the last 60 days’ exuberant rallies in both blockchain cryptos and tech stocks.
How The Grinch Stole Bitcoin’s Christmas
So why aren’t crypto assets and equities in the usual holiday spirit this year?
Valuations were already steep going into the holidays. The ebullient Trump bump since Nov. 5 sent markets flying high in the hopes of four good years ahead for cryptocurrency and US businesses.
Moreover, there’s been a Bitcoin miner selloff amid rising energy prices all year. The Bitcoin miner sales gathered pace this December into the holiday season.
The tech stock slump may also be dragging down the average exchange rate of major cryptocurrencies. The BTC Pearson 30-day correlation to Nasdaq stocks has been rising since July to in sync over 70% of the time.
But just like baseball, in financial markets, it isn’t over until it’s over, and there are still three days left in the year to see which way markets move next.
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