Bitcoin holds near $88,500 as long positions build on Santa rally hopes

According to the CoinDCX Research Team, the Bitcoin price is slowly coiling up, withstanding significant bullish and bearish pressure throughout the weekend.

The Bitcoin price stood at $88,887.89 on December 22 (10:30 a.m. IST), up 0.96 percent in a day and a decline of 0.87 percent in a week. In the morning session, the world's largest cryptocurrency fell as low as $88,122 and peaked at just above $89,2396.

"Bitcoin is stabilising around $88,500 as long positions build on expectations of a potential Santa Rally. That said, for a sustained upside move, Bitcoin needs to clear liquidity above the $90,000 mark, until which Bitcoin remains vulnerable to further consolidation,” said Akshat Siddhant, Lead Quant Analyst, Mudrex.

The volatility has been observed across other cryptocurrency tokens as well, with ETH up 2.18 percent, ADA down 0.30 percent, SOL up 0.32 percent, XRP down 0.06 percent, and Tether is down 0.01 percent in the past 24 hours.

“Ethereum continues to outperform, holding above $3,000 and testing its 200 EMA near $3,100, a key breakout level that could trigger upside toward $3,150-$3,200. Broader altcoins are mixed, with TRX and XMR showing notable strength while XRP and ADA see mild pullbacks,” said  Riya Sehgal, Research Analyst, Delta Exchange.

Check out the cryptocurrency prices on December 22, as of 10:30 a.m (IST).

According to the CoinDCX Research Team, the Bitcoin price is slowly coiling up, withstanding significant bullish and bearish pressure throughout the weekend. With this, the markets have remained largely stable, with the top 10 cryptos rising above their respective local resistance. The current trade dynamics hint towards a sustained upswing, while the fear of a huge clash continues to hover over the markets.

“With the fear and greed index at 29, the overall market sentiments continue to remain under fear. Some of the reports suggest Bitcoin on-chain capital inflows have weakened after 2.5 years of growth, while the sentiment recovery is believed to take months,” the team added.

Nischal Shetty, Founder of WazirX, said that in the last 24 hours, crypto markets have continued to take direction less from crypto-specific developments and more from global macroeconomic signals, especially shifting expectations around U.S. monetary policy. The dominant narrative remains anticipation of future Federal Reserve rate cuts.

“With inflation gradually cooling and labour markets showing early signs of softening, investors are increasingly pricing in a lower-rate environment. This is supportive for crypto, as lower real yields reduce the attractiveness of cash and bonds, encouraging capital to rotate toward risk assets and alternative stores of value like Bitcoin and other major digital assets.

“Inflation data itself is not the driver of sustained crypto trends. CPI and employment data mainly act as short-term sentiment triggers, with price reactions often reversing unless they meaningfully change expectations around the Fed’s policy path. What truly matters is how macro data reshapes central bank behaviour,” said Shetty.

Here’s a rundown on what’s happening in the crypto market:

• Nearly 350,000 BTC was sold at a loss in the recenet times as retail panics, whales accumulate.
• The Fed is expected to inject $6.8 billion into the market this week, bringing the total injections to $38 billion, which may benefit the crypto markets.
• The US lawmakers have proposed a $200 tax exemption for stablecoin payments and delayed taxes on staking rewards.