Bitcoin entered the final stretch of the year with an unusual calm, trading close to 88,000 and showing little sign of urgency ahead of the yearly candle close. While some analysts see technical signals hinting at a rebound, the broader picture remains uncertain. A yearly close in the red would mark a first for Bitcoin in the post halving era and could challenge long held beliefs about the four year market cycle.
Weekend Calm Masks Underlying Tension
Bitcoin spent the weekend moving sideways, with TradingView data showing barely any volatility after Friday’s sharp but short lived price swings. Those moves were linked to a record 24 billion dollars worth of options expiring, an event many traders believe temporarily suppressed price action.
Since then, the market has settled into a narrow range. Despite the quiet trading, analysts argue that the lack of volatility itself may be meaningful. Bitcoin is currently hovering just below a key psychological level, leaving traders focused on what the yearly close could signal for the months ahead.
Bullish Divergence Offers a Ray of Hope
Technical analysts have pointed to a developing bullish divergence on the three day relative strength index chart. Trader Jelle highlighted that Bitcoin has locked in a similar divergence at major support levels in the past, with previous instances leading to notable price recoveries.
According to this view, the current setup resembles earlier cycle lows, suggesting that history could repeat itself. However, confirmation would likely require a decisive move higher, something that has so far remained elusive as the year draws to a close.
Seasonality and Institutional Flows in Focus
Other traders are leaning on seasonal trends to support a more optimistic outlook. Trader BitBull suggested that early January often brings renewed capital allocation, particularly from institutions looking to rebalance portfolios and rotate into assets that have underperformed.
If that pattern holds, Bitcoin could see a breakout from its current trendline, opening the door for a push toward the 100,000 level in the new year. This thesis depends largely on fresh inflows rather than short term technical moves, placing emphasis on broader market behavior once the calendar flips.
Low Volatility Reflects a Cooling Phase
Veteran analyst Aksel Kibar said Bitcoin’s current range bound behavior should not come as a surprise. After strong gains during the third quarter, a cooling off period was inevitable.
BTC/USD one-day chart. Source: Aksel Kibar/X
Kibar noted that volatility tends to move in cycles, with periods of sharp price action followed by extended consolidation. In his view, the market is waiting for a clean chart pattern before making its next meaningful move, rather than reacting to short term noise.
Yearly Candle Puts Four Year Cycle to the Test
With only days left before the yearly close, Bitcoin is down roughly 6 percent for the year. If the price fails to recover, 2025 would become the first red year following a halving event, a statistic that has sparked debate about whether the traditional four year cycle model still applies.
Keith Alan, cofounder of trading resource Material Indicators, stressed that closing prices matter more than temporary wicks beyond key levels. He said the color of the yearly candle could offer important macro insights when markets reopen in January.
Alan also pointed out that Bitcoin could still attempt a last minute retest of the yearly open near 93,500. Such a move would not only shift sentiment but also help preserve the historical pattern that many long term investors continue to watch closely.
As Bitcoin sits near 88,000, the market remains caught between technical optimism and historical uncertainty. Whether the year ends with a recovery or a red candle, the outcome is likely to shape expectations for the next phase of Bitcoin’s market cycle.
