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- The crypto market has started to recover from recent declines last week.
- Recent price action indicates a buying bias among active holiday traders anticipating a crypto ‘Santa Gathering’.
- Investors may turn their attention to altcoins this holiday season following increased inflows into Ethereum ETFs and the outperformance of altcoins.
Bitcoin (BTC) and the overall cryptocurrency market rose 5% on Tuesday as the major asset tries to recover from the significant decline experienced last week. Altcoins have become the main focus of this market uptrend, suggesting that investor optimism could fuel a ‘Santa Clause rally’.
Altcoins are leading the market recovery as investors encourage Santa’s gathering
The general crypto market is experiencing an uptick on Christmas Eve, recovering from the recent market decline last week. Major assets including Bitcoin, Ethereum, Solana, XRP and Dogecoin saw a recovery fueled by increased buy-side pressure among holiday traders.
This shows that the market could witness a ‘Santa rally’, an event where cryptocurrencies rise during the last five trading sessions of the year until the first two Januarys. Recent price action on Tuesday suggests holiday traders are buying into the narrative.
Another reason for the price recovery could be the expectation that the crypto market will continue its upward trend after the end of the holiday season.
This expectation may be related to the inauguration of Donald Trump as the President of the USA on January 20, which crypto market participants predict will lead to a massive increase.
In addition, Ethereum exchange-traded funds (ETFs) saw inflows of $130.8 million on Monday despite Bitcoin ETFs posting $226.5 million in outflows, according to data from Coinglass. The huge contrast between these products shows that investors are turning their attention to altcoins this season.
This is evidenced in the double-digit gains seen in several altcoins, including Pudgy Penguins (PENGU), Hedera (HBAR), JasmyCoin (JASMY), Stellar (XLM), etc.
Altcoin 24 hour performance. Source: Coinmarketcap
A similar trend is visible in the general stock market, which is posting gains, indicating that traditional investors are also buying the story of a Santa reunion.
