BITCOIN HOLDS NEAR $88K AS BULLS FACE CRUCIAL TEST AND CHRISTMAS RALLY EXPECTATIONS
Bitcoin has now spent six consecutive weeks trading below its long-term bull market channel, a trend that had held strong for nearly two years. This extended period under the channel has raised concerns among analysts about the cryptocurrency’s short-term trajectory as 2025 draws to a close.
After breaking below the channel, Bitcoin has repeatedly struggled to reclaim its previous upward trend. Over the past six weeks, the asset has made three separate attempts to re-enter the channel, but each effort was met with strong resistance along the lower boundary of the former trend structure. These repeated rejections suggest that the market is facing a significant test at these levels.
Technical analysts also note that the current price action resembles a 2021-style rounded top, signaling potential caution for traders. Complementing this technical view, VanEck’s data points to a decline in Bitcoin’s network hashrate growth, adding another layer of concern about the strength of the market. Together, these factors frame a pivotal retest of resistance, with Bitcoin’s ability to break back above the channel likely to shape its near-term direction.
Bitcoin Price Stalls at Key Resistance: What Could Happen Next?
Bitcoin is currently consolidating just below a critical resistance level, signaling that a fourth attempt to break higher may be underway. Analysts say how the asset reacts at this level could determine whether the recent pullback is merely a short-term deviation, a retest from below, or the start of a more prolonged downward trend.
Some market observers have noted similarities between Bitcoin’s current price action and the 2021 cycle. In both cases, the cryptocurrency formed a rounded top, followed by a sharp decline, a rebound, and continued downward pressure, according to technical analysis reports.
One analyst highlighted that the current support level being tested also played a key role in 2021. A breakdown from this level back then triggered a significant price drop. While a move toward previous peak levels is still possible, these past highs have historically acted as turning points in market sentiment rather than signs of sustained strength.
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Technical interpretations among analysts vary. A trader pointed to a potential bearish pennant forming on the weekly chart, which could signal a move toward lower major support levels if confirmed. Meanwhile, VanEck reported a decline in Bitcoin’s network hashrate as of mid-December, indicating a slowdown in mining activity. Historically, such drops have sometimes occurred near market bottoms, though analysts warn that past trends don’t guarantee future results.
Following the breach of its long-term bull market channel, Bitcoin has struggled to regain momentum. Traders are closely watching key technical levels to gauge whether the cryptocurrency can recover or faces further downside pressure.
Bitcoin Price and the “Christmas Rally”: What to Expect
Historically, December has been a mixed month for Bitcoin. Since 2013, BTC has closed the month higher only five times and lower seven times. On average, however, December returns have been around +4%, masking extreme swings ranging from roughly +47% to −35%.
Seasonality data aggregated from Coinglass and Binance shows that December tends to be slightly positive on average, which has fueled the popular “Santa rally” narrative. However, the distribution is bimodal: Bitcoin either experiences strong rallies or sharp declines, rather than a steady, moderate gain.
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Recent analysis indicates that the Santa rally effect may be weaker than often assumed. The massive year-end surge in 2020 skews long-term statistics, while the last few Decembers have delivered much smaller gains—or even losses. As a result, relying on the “Christmas rally” as a market edge may be misleading at best, and traders should exercise caution rather than expect predictable year-end gains.
