Bitcoin’s so-called Santa Claus rally is off to a rocky start this December, as the leading cryptocurrency dropped 7.6% in the past 24 hours. Dogecoin (DOGE-USD) stole the spotlight—but for all the wrong reasons—plunging by 19% in the same period, extending its 5-day losses to a staggering 27%.
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Hawkish Fed and Overbought Markets Hit Hard
The downturn follows a hawkish tone from Federal Reserve Chair Jerome Powell, who indicated only two rate cuts in 2025, disappointing market expectations of three. Traders at Singapore-based QCP Capital believe Bitcoin’s slump stems from “overly bullish positioning” in recent weeks. “The market was left extremely vulnerable to shocks after a one-sided run,” they noted in a Telegram broadcast, according to CoinDesk.
Dogecoin’s Oversold Status Sparks Debate
Meanwhile, Dogecoin, despite its massive losses, might be entering oversold territory. According to U.Today, the popular Bollinger Bands indicator suggests the meme coin could soon rebound. However, its current price of $0.34 remains precariously below its lower Bollinger Band.
Historically December Has Been Strong for Crypto
Historically, December has been a strong month for Bitcoin, with six green finishes since 2015. Yet, this year’s selloff might put a damper on the festive rally. While short-term volatility reigns, some analysts still believe seasonality could offer a late-year boost.
At the time of writing, Bitcoin and Dogecoin are sitting at $94,601.57 and $0.29, respectively.
