Market Sentiment and Analyst Outlook
Following a five-day bullish streak, Bitcoin appears to be regaining market confidence, holding firm at the $87,000 mark after its steep 30% drop from October’s highs. Despite improving macroeconomic conditions and a growing interest in risk assets on Wall Street, analysts are moving cautiously, warning that a major breakout might not arrive until next year.
Robin Singh, CEO of Koinly, pointed out that the main challenge is Bitcoin’s difficulty in reclaiming the $90,000 level, a process that has taken longer than expected. The CEO added that the market is entering its typical “Christmas hibernation,” which reduces the probabilities of explosive price action before the end of the year. This pessimistic sentiment directly impacts the Bitcoin year-end outlook.
The total cryptocurrency market capitalization is climbing back to $3.1 trillion, driven by a generalized rebound in global stock markets and improved expectations around a possible Federal Reserve (Fed) interest rate cut in December, a factor that has rekindled optimism in risk assets.
The Dual Signal from ETFs and the Federal Reserve
In the institutional investment segment, U.S. spot Bitcoin exchange-traded funds (ETFs) recorded inflows of $129 million last Tuesday. However, this figure is overshadowed by the outflow of nearly $3.6 billion from Bitcoin ETFs in November, marking the worst month for sales since February. Despite this scenario, technology and artificial intelligence stocks, considered a proxy for general risk appetite, have managed to rebound.
The Bitcoin year-end outlook is nuanced by the macroeconomic factor. BTC’s stabilization coincides with growing optimism about Fed policy. Following statements from Governor Christopher Waller about possible “near-term” cuts, bets on the CME FedWatch tool assign a probability close to 83% for a 0.25% rate cut in December. This macro signal is crucial for global investor sentiment.
Regarding the last month of the year, Wintermute OTC trader Jake Ostrovskis is also bearish, stating on X that the market has already priced out the “Santa Claus rally.” Generally, December has not been a month of big jumps for the cryptocurrency; Bitcoin’s average December return has been less than 5% since 2013.
Although options market traders, according to Deribit, expect BTC to reach $118,000, the consensus is that it “will not explode past” that level. A decisive reclamation of $90,000 in December, according to Singh, would be key to dispelling “early crypto winter anxieties” in 2026.
Disclaimer
The information presented in this article is for informational purposes only and should not be interpreted as investment advice. The cryptocurrency market is highly volatile and may involve significant risks. We recommend conducting your own analysis.