Bitcoin gradually declined over the weekend, briefly dipping below 88K this morning. A recent report from 10x Research points out that Bitcoin's price broke below the lower edge of a triangle consolidation pattern, creating a vulnerable situation amidst declining year-end liquidity. This week, the Bank of Japan (BOJ) may raise interest rates by 25 basis points again, increasing the risk of yen carry trade unwinding and potentially impacting high-risk assets like Bitcoin first. In times of poor liquidity, rather than hoping for a Christmas rally, moderately reducing leverage is absolutely the first principle for survival.
10x Research: Bitcoin breaks below triangle consolidation range
A recent report from 10x Research points out that as the cryptocurrency market enters its year-end, volatility has narrowed, and liquidity and participation have declined, creating a fragile situation beneath the surface. Positions in Bitcoin and Ethereum derivatives indicate that traders are reducing short-term exposure and maintaining defensive strategies rather than chasing upward movement. ETF flows, stablecoin issuances, and futures positions all point to the same conclusion: without new capital inflows, the rally is unlikely to be sustainable .
The report points out that the options market is increasingly converging on pricing in range-bound trading, but if support levels are breached, the risk will shift significantly to the downside. Especially after Bitcoin's price broke below the triangle consolidation range this morning, the next key support level to watch is 84K.
With the Bank of Japan raising interest rates imminent, will there be a Christmas rally?
Analyst Jeff Park also pointed out that 2025 will be a paradoxical year for many Bitcoin traders, as mainstream risk assets like the Big Seven, artificial intelligence, and even gold have performed exceptionally well amid expectations of depreciation, while Bitcoin has lagged behind. He believes one of the root causes of this discrepancy lies in the options market, particularly with native Bitcoin investors (whale or OGs), who use their Bitcoin holdings as collateral to sell call options, causing continuous selling pressure as Bitcoin falls and creating another, more severe negative impact on the entire market.
Cryptocurrency analytics firm Glassnode says multiple indicators are currently pointing to a "mild bear market phase," characterized by low inflows and continued selling by large holders. The firm notes that with prices trapped in a "weak but bounded range," time itself is becoming a negative factor as unrealized losses accumulate. Relative unrealized losses jumped to 4.4%, the highest level in nearly two years, after previously hovering below 2%, signaling a shift from market euphoria to "high tension and uncertainty."
The anticipated Christmas rally is highly uncertain, as Bitcoin is currently in a correction phase and may fluctuate between $85,000 and $95,000 in the short term. However, the Bank of Japan (BOJ) may raise interest rates again this week, increasing the risk of yen carry trade unwinding and potentially impacting high-risk assets like Bitcoin first. Therefore, in times of poor liquidity, moderately reducing leverage is absolutely the first principle for survival.
This article, "Bitcoin Breaks Below Triangle Convergence Range, Will the Christmas Rally Follow the Bank of Japan's Imminent Rate Hike?", first appeared on ABMedia .
