Bitcoin will now decide whether or not to preserve the one-year trendline as support in what has historically resulted in long-term upside.
Bitcoin (BTC) prepared a showdown with a key moving average (MA) price trend on Dec. 19 with time running out for a strong 2021 close.
“I vote we bounce and stay bull”
That price is currently the location of Bitcoin’s one-year MA trendline, an important historical line in the sand that has enabled considerable upside if BTC/USD preserves it as support.
“The 1yr MA is a pretty important bitcoin bull/bear pivot level historically and we are sat right on it now,” Philip Swift, creator of on-chain data resource Look Into Bitcoin, commented.
“I vote we bounce and stay bull.”
A bounce would still leave a vast amount of ground to recover in order to post an end-of-year closing price even slightly in line with previous bullish expectations.
Among them are those of stock-to-flow model creator PlanB, who at the weekend acknowledged that his $100,000 target for 2021 was unlikely to hit.
He added that he would not be abandoning his models, which remain valid despite recent events.
Bitcoin needs a small miracle for a 100K Christmas. Will I ditch S2F model if this does not happen? Nah, I actually like being at the lower bands. In fact I published the model at the lower bands in March 2019 with btc below 4K. pic.twitter.com/L1m0jFGNYM
— PlanB (@100trillionUSD) December 18, 2021
No “Santa rally” for macro this year
The unusual end to 2021 has also impacted traditional markets, meanwhile, with the classic “Santa rally” nowhere to be seen last week.
Comments from the United States Federal Reserve provided a short-lived performance boost, but overall, progress has been limp compared to earlier in the year.
“Look as if mkts not staging typical Santa Rally,” markets commentator Holger Zschaepitz concluded.
“Global stocks have lost $1.8tn in mkt cap this wk as investors reacted to hawkish Fed pivot, spike in Covid cases & find themselves positioning into 2022 of already-elevated valuations. Stocks still worth $118tn, 140% of global GDP.”
The immediate outlook was no more favorable, with the Coronavirus Omicron variant sparking fresh economic shutdowns set to last into the new year.