A classic Wall Street seasonal trend could offer a boost to Bitcoin bulls as the year comes to a close.
Bitcoin (BTC $87,972.47) has endured its toughest fourth quarter since 2022, but the Santa Claus rally — a historical upswing in the S&P 500 during the last five trading days of December and first two of January — may improve sentiment for BTC and the broader crypto market.
Since 2005, the S&P 500 has gained 15 times during this period and fallen only five, averaging 0.58% returns, according to The Market Stats. Extending back to the 1950s, the index has risen 77% of the time and has never declined three years in a row during the Santa period. Although the past two rallies saw dips, history suggests a year-end upswing is likely.
For bitcoin, the increasing link to equities through institutional adoption and ETFs makes the Santa rally particularly relevant. BTC’s own Santa Claus history is mixed: strong gains of 33% in 2011 and 46% in 2016 contrast with declines of 14% in 2014 and 10% in 2021, averaging 7.9% since 2011.
Gold shines
Gold has consistently led during Santa periods, delivering a cumulative 95% return since 2005, with only 2023 posting a slight negative. The metal recently reached record highs above $4,400 an ounce, suggesting another potentially strong holiday season.
Overall, while gold trades at all-time highs and the S&P 500 is just 1.5% below its peak, bitcoin remains roughly 30% below its all-time high, leaving room for upside if seasonal trends in equities and gold translate into renewed crypto momentum.
