“The rear view mirror is always more clearer than the windshield.”
No one can predict the future with 100% certainty, but we can learn from the past. Looking back at how the markets have performed during previous months and years can give you an idea of what may be in store for the future.
The month of July brought Bitcoin from $30,000 USD to $40,000 USD, August brought it from $40,000 USD to above $50,000 USD, and September gave Bitcoin that much needed rest before October brought it to a new all time high of $67,000 USD. November brought new all time highs at $69,000 USD before dropping $15,000 USD to $54,000 USD for a huge discount to traders and investors. December is here, what can we expect this month?
In the stock market, December has been shown to be a good time to buy stocks. Many investors start to sell stocks during this time, especially those that have declined in value, in order to claim capital losses on their tax returns. Historically, a sell-off comes in December—and with it a potential drop in investment value for new investors. December is the market's third best month and boasts an average price change of +1.3%.
What about the cryptocurrency market? Historically, how has Bitcoin performed during the month of December? Will December be a red month? Or will it be taking Bitcoin to higher highs?
The statistics are looking very good for Bitcoin in December. Looking back at the Bitcoin charts it’s easy to see that Bitcoin tends to see positive returns in the month of December.
As a crypto investor/trader, should you be excited? Is it time to go all in?
Over the last decade, six out of ten December months were green. On average, when Bitcoin saw positive returns, Bitcoin had an increase in +29%! During last years green December Bitcoin saw a monthly return of +47%! When December has been red, the average returns were about -15%.
While December seems to be an exciting and promising month for Bitcoin, traders should still be cautious. The months of April, May, and November have historically been green months. 2021 decided that they all would be red this year.
The Greed and Fear Index has been ranging between “Extreme Fear” and “Fear.” It is currently at “Fear.”
The first week of December did not play out as I anticipated. Technical indicators, specifically the RSI and MACD were very looking strong on the weekly timeframe. Lower timeframes showed that the Bitcoin bulls and bears were struggling... Bitcoin was oversold on the RSI and a breakout to the upside was likely. Unexpectedly, during the first few days of December the Bitcoin bears took full control and dropped the value of Bitcoin to as low as $41,000 USD! Bitcoin did make a come back and closed the week around $49,000 USD. This marks the third consecutive weekly red candle Bitcoin has experienced since June 2020.
The second week of December started off with the bulls gaining some momentum. The bulls took the price to as high as $52,000 before the bears brought it back down to $46,000. The weekend bulls however stepped in and Bitcoin is nearing the weekly close around $50,500. This was a much needed win for the bulls.
I had predicted that the third week of December was going to be a green week and that Bitcoin would resume its upward trend. I was wrong. With renewed strength the bears erased the gains from the two previous green days and brought the price down to $46,000. Throughout the week the bulls could only print a lower high and the trend seems to be continuing towards the downside. $45,000 has been holding as support for now… but further downwards movement is possible…
This last Christmas week Santa brought a green bullish engulfing weekly candle! The bulls were in control the entire time and started an uprising channel- higher highs and higher lows were made. Bitcoin price nearly hit $52,000, which is a big resistance that the bulls need to overcome.
Is this week the beginning of higher highs for Bitcoin? Looking at the charts… Im expecting Bitcoin to reach $54,000-55,000… but I am being cautious of the possible “head and shoulders” pattern that is forming.
If the pattern comes to play then could this be the end of the bull market? Or will Bitcoin invalidate it and climb back into the macro upwards channel? We’ll have to wait and see…
Anything can happen. Always expect the unexpected. Stick to your plan. Take profits. Set your stop losses. Don’t get greedy.
Thank you for your time! If you found this article interesting or helpful in any way please let me know in the comments below. Feel free to follow me for more articles on how I invest or how I earn other free rewards such as crypto, stocks, or gift cards.
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*Disclaimer- I am not a certified financial planner/advisor, certified financial analyst, economist, CPA, accountant, or lawyer, or anything important for that matter. The contents of this article are for informational, educational, and entertainment purposes only and do not constitute financial, accounting, or legal advice. Always do your own research.*
