I'll explain why. The circulating supply is diminishing after the holiday dropping them is over. For example using fictional numbers there can be 100,000 new santa hats created during that holiday period and after the event is removed and the spawn events have stopped that is the cut off point of new supply for an entire year.
Then this happens:
Players who did the event or received some of the spawned holiday items have may not be playing anymore or play casually so that supply is just sitting on their accounts in small quantities which does not affect the GE price.
Players invest and sometimes they end up quitting or going on long breaks for whatever reasons. That supply is also out of circulation. Does not impact GE price.
Players who play actively might be accumulating right after the holiday or even during the holiday season at lowball prices and they simply soak up more of the circulating supply at huge discount prices. These players basically got the cream of the crop in terms of return on investment. Much of the supply they own doesn't even have to be sold for them to make a huge return on the initial investment.
Total supply does not matter because total supply will never be the circulating supply. Circulating supply is usually a small percentage of the total supply. Say there's 1,000,000 of a holiday item in total supply, the circulating supply might be a few percent of that total supply. That small percent is distributed into multiple holders who have their own perception of the value they think it's worth. One person may have 10,000 of that item but they might be selling at a higher price at a slower rate than a person who might have 100 of the item.
However you are correct. The amount of supply does increase but the ability to profit does not cease to exist because of the nature of how these items are annually introduced into the game and the huge lapse of supply discontinuation period. Unless there was a consistent drip drip drip of supply on a daily basis we will simply always see this sort of volatility occur.