The global crypto market rose sharply over the weekend, as Bitcoin and major altcoins gained on better economic news and large short liquidations.
Market data showed that Bitcoin rose 3.4% on Sunday to a two-week high of $115,400, before stabilizing around $115,226. Despite the rebound, Bitcoin remains approximately 8.6% below its all-time high of $126,080, registered on October 6, 2025.
Ethereum also joined the surge, rising 7% to trade near $4,216. XRP, BNB, and Solana followed with modest but notable gains of 2% to 5.5%.
Macroeconomic Factors Drive Bitcoin Momentum
Analysts attribute the rally to a mix of supportive economic signals and geopolitical developments.
According to Rachael Lucas, a crypto analyst at BTC Markets, current price dynamics reflect an enduring structural trend sustained by favorable economic fundamentals, diminishing on-chain supply, and corroborative technical signals.
Moreover, investor sentiment improved following reports indicating progress in US-China trade talks. The two largest global economies have reportedly reached an initial understanding outlining a possible trade accord.
Additional negotiations are anticipated during discussions between Donald Trump and Xi Jinping in South Korea later this week. Lucas noted that signs of better U.S.-China relations are “encouraging for global markets.”
She added that such improvements could also ease supply chain pressures and boost appetite for risk assets, including cryptocurrencies.
Rate Cut Expectations Add Fuel to the Rally
Additionally, markets are preparing for the FOMC meeting on for Tuesday and Wednesday. Traders widely expect another interest rate cut, which could further support speculative assets.
The CME Group’s FedWatch Tool indicates a 96.7% probability of a 25-basis-point rate cut. Should this occur, the Fed’s target range would be 3.75%-4.00%. Lower borrowing costs generally improve liquidity, often benefiting high-risk investments such as digital assets.
Massive Short Liquidations Amplify Rally
The weekend’s rally gained momentum as traders betting against the market were forced to close their positions.
According to CoinGlass data, traders holding short positions worth approximately $373.07 million faced liquidation within 24 hours. Of this total, a significant $231.23 million happened within just 12 hours.
Lucas described the move as a “classic short squeeze,” where modest price increases trigger rapid buybacks by short sellers, accelerating upward momentum.
Analysts Eye Possible ‘Santa Claus Rally’
Looking ahead, analysts expect the bullish tone to persist as the year draws to a close. Historically, the crypto market often experiences a late-year upswing, commonly known as the “Santa Claus Rally.”
Nick Ruck, Research Director at LVRG Research, said the market may continue to strengthen into the year-end, supported by post-halving optimism and seasonal liquidity flows.
BTC Markets’ Lucas projected that Bitcoin could rise between 15% and 25% from current levels, potentially reaching $130,000 to $150,000 by the end of 2025.
Vincent Liu, Chief Investment Officer at Kronos Research, added that portfolio rebalancing, strong macro signals, and expected rate cuts could further fuel upward momentum. However, he warned that volatility will likely persist as markets adjust to shifting economic data.
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