BTC's 'Christmas rally' aims for $120,000, key Bitcoin indicators turn bullish.
Bitcoin approaches $90,000 under the expectation of a 'Christmas rally', with derivatives and chart patterns turning bullish, targeting above $100,000.
According to key market indicators, Bitcoin surged towards $90,000 during the Asian morning session on Monday, suggesting a 'tactical' upside potential in price.
Key points:
Bitcoin has risen 6.5% from its recent low, fueling expectations for a 'Christmas rally', targeting as high as $120,000.
Shorts dominate, potentially providing momentum for longs.
For a sustained recovery to occur, the price of Bitcoin must not fall below $84,000.
The "Christmas rally" has resumed, with Bitcoin surging $5,000 in a single day.
According to data from Cointelegraph Markets Pro and TradingView, BTC/USD reached a high of $89,850 during the session, up 6.5% from the local low of $84,400.
Analyst AlphaBTC stated on Monday on the X platform that Bitcoin is "preparing for a Christmas rally."
The accompanying chart shows that the current market recovery is expected to push BTC/USD to test the opening price of $93,300 at the beginning of the year, and then challenge the resistance zones of $98,000 and $100,000.
"Give us a Christmas present and let's aim for $98,000-$100,000."
Since November 22, Bitcoin has been consolidating within a wide range of $82,000 to $95,000, and is now poised to break out of a bullish giant microphone pattern.
"The longer the sideways movement lasts, the greater the strength and potential for a subsequent rebound."
The target price for the above pattern is $120,000, representing a 34% increase from the current price.
However, not all analysts believe the "Christmas rally" will materialize as expected. Predictions of Bitcoin reaching six figures contradict market warnings of a $70,000 pullback.
Ardi analyzed the price movements of Bitcoin during the "Christmas trading window" (December 24 to January 2) over the past five years, stating that Bitcoin's overall performance showed "decreasing returns year by year, with actual selling pressure," and that the 34.5% increase in 2020 was an anomaly.
The chart below, based on a four-year cycle, shows that "2025 and 2021 are at the same post-halving point," the analyst added, noting that Bitcoin fell 7.9% during that period in 2021. He further stated:
"As of December, we observed structural signals similar to those of 2021, with large investors continuing to reduce their holdings during the holiday trading peak."
Bitcoin derivatives add strategic value to bullish positions.
CryptoQuant analyst Axel Adler Jr. stated that the current Bitcoin market structure presents strategic upside potential, a view further reinforced by the derivatives market structure. The analyst noted on Monday on the X platform:
"BTC is entering the Christmas trading window: the Regime Score is bullish, but not yet overheated."
The chart below shows that the Bitcoin Regime Score is currently at 16.3%, placing BTC/USD in the upper neutral zone historically, a zone that has historically been a bullish signal.
Currently, the derivatives liquidation structure is more favorable to the bulls, with data showing that short covering is dominant and could trigger upward price pressure.
The ratio of long to short margin calls has dropped to -11%, indicating a surge in forced short covering. Meanwhile, the 30-day moving average remains in the positive range of 10%, as shown in the chart below.
He pointed out:
"The dominance of short-selling liquidation provides momentum for a strategic rebound in the short-term upward trend."
Bitcoin's key support level remains at $84,000.
Since the pullback on November 11, the price of Bitcoin has firmly held above the psychological level of $84,000. This level has become a key area of focus for traders and must be held; otherwise, they will face greater downward pressure.
Trader and analyst Daan Crypto Trades said that $84,000 "is a key level that bulls desperately need to hold on at higher timeframes."
Glassnode's cost base distribution heatmap further emphasizes the importance of this position. The recent support zone is in the $84,000-$85,600 range, where investors collectively bought approximately 976,000 Bitcoins.
Holding above this range is a key prerequisite for the market to regain upward momentum and challenge $100,000 or higher.
As Cointelegraph previously reported, short sellers are planning to break through the $84,000 support level and target the next level – $80,000.
