Bitcoin bulls find hope as stock markets lean on Santa-season gains

A familiar Wall Street seasonal trend could bring a lift to battered Bitcoin bulls as the year winds down.

Bitcoin (BTC $87,972.47) has faced its harshest fourth quarter since 2022, but investors may find encouragement from the Santa Claus rally — a historical upswing in the S&P 500 during the final five trading days of December and the first two of January. If the pattern repeats, it could bolster sentiment in bitcoin and the wider crypto market.

Since 2005, the S&P 500 has gained during the Santa Claus rally 15 times and lost only five, averaging a 0.58% return, according to The Market Stats. Looking further back to the 1950s, the index has risen 77% of the time during this period and has never declined three years in a row. Despite dips in the past two Santa periods, historical trends suggest a likely year-end rally in equities.

The link between equities and bitcoin has strengthened with growing institutional adoption, particularly via ETFs. A seasonal boost in stocks could therefore spill over into bitcoin. BTC’s own Santa Claus performance has been uneven: the cryptocurrency gained 33% in 2011 and 46% in 2016, but fell 14% in 2014 and 10% in 2021. On average, BTC has posted a 7.9% return over this period since 2011, when the market was smaller and dominated by early adopters.

Gold leads the way

Gold has consistently outperformed during Santa periods. TheMarketStats reports that the precious metal has delivered a cumulative 95% return since 2005, with only 2023 showing a slight negative result. Gold recently hit record highs above $4,400 per ounce, signaling another potentially strong Santa season.

In comparison, the S&P 500 is just 1.5% below its record levels, while bitcoin remains roughly 30% below its all-time high, suggesting room for upside if historical equity and gold trends translate into renewed crypto momentum.