BTC Could be Bearish During December’s First Week

Bitcoin price performance was against many predictions. However, it is no surprise as several outlooks pointed at the asset failing to impress during November. The analysis stated that the apex would retest and flip the $21k resistance before the downtrend hits.

A look at the chart shows that it happened this way. It also predicted that the low would be around $16k and $14k. This happened as BTC dipped to a low of $15,479. After these events, we noticed small uptrends.

As a result, the last two weeks of November were bullish. This may negatively impact price action during the first few days of December. There are other factors to consider. One such are fundamentals.

The FOMC Will Meet This Month

One of the most dreaded events in finance is the meeting of the Federal Open Market Committee. This is because this body is in charge of setting interest targets. This means that after the meeting, there is a chance they announce an increase in interest rates.

Based on previous price relations to such announcements, we may expect an impact on the value of the asset under consideration. It is also important to note that an increase could cause a notable drop in value, while a reduction could lead to more price increases.

Aside from this, one of the days that many are anticipating is December 13. This is when the concerned will release the Consumer Price Index. Like the interest rates, it could also impact bitcoin’s price.

Last month, the CPI had little or no impact on prices, and some cryptocurrencies tested key resistance in response. For example, BTC staged a massive recovery from the previous low. After the release, the coin surged from $16k to a high of $18,150.

Although it experienced rejections after its peak, it closed the intraday session with gains exceeding 10%. One reason for such a reaction is that the increase in inflation seems to have slowed down.

It is hard to guess if the good news will also have the same effect this month. Let’s see how prices play out. Nonetheless, let’s look at other factors.

Previous Records Suggest Notable Increase in December

A look at the monthly heatmap, we concluded that November was the second-best period for the asset under consideration. Unfortunately, the previous month ended with a loss exceeding 17%; the second-worst performance of the year.

The question at this time is if December would turn out the same. It is worth noting that BTC had its biggest drop of the period last year. It lost more than 18%. This makes it the third time since bitcoin became a tradable asset in 2010 that it ended the eleventh month with a loss.

It is also no news that the period under consideration is considered one of the most bearish times. There is a theory that the cryptocurrency sees massive withdrawals as traders take profit.

However, on average, BTC gains more than 9% which makes December the fifth most bullish month of the year. Its hard to say if this 30-day session will end in profit or loss as there is no set pattern.

The last time bitcoin recorded losses, it was followed by another. It remains to be seen how prices will perform. To get more insights, we turn to the charts.

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