The US presidential election is once again in the spotlight.
Author: 1912212.eth, Foresight News
The major market correction in early October has left some investors with lingering doubts, worried that October, which has historically maintained an upward trend, may "be different" this time. However, history seems to have once again proven that "this time is no different".
After soaring to a peak of $66,000 at the end of September, BTC did not stay put, but instead experienced a heart-pounding pullback, plunging to a depth of $59,000. But it is precisely this volatility that has given birth to an even more surging rebound! Starting from October 11th, the market situation changed abruptly, with a sharp single-day increase of 3.67%, announcing the return of the upward trend. The price surged back to the $63,000 high ground, and then even more decisively, reaching $66,500.
At the same time, Ethereum also broke free from its shackles, surging from $2,300 to $2,650, with a single-day gain of over 6.52%, marking the largest single-day increase since August.
In the market rally ignited by passion and hope, multiple sectors such as public chain SUI, SEI, APT, stablecoin ENA, AI ARKM, WLD, and meme coins all experienced significant rallies.
In terms of contract data, short positions suffered heavy losses. $246 million was liquidated across the network in 24 hours, with $210 million in short positions being liquidated. The open interest in BTC contracts also soared to over $37 billion.
The altcoin market is in a state of chaos, has the second half of the bull market really begun?
BTC Spot ETF Sees Massive Single-Day Net Inflows
Since early October, while there have been some net outflows, they have largely been balanced by net inflows. Starting from October 8th, there were 3 consecutive days of net outflows, totaling nearly $180 million.
On October 11th, the data saw a major reversal, with the Bitcoin spot ETF recording a single-day net inflow of $253.54 million, setting a new high for net inflows in October. After the large influx of off-exchange capital, BTC prices also saw a sharp rise on the same day.
Off-exchange capital confidence remains relatively firm.
The Fed Will Continue to Cut Interest Rates, Market Expectations Stabilize
This week, the US released September CPI and PPI, the two major inflation data points. Overall CPI and core CPI year-over-year and month-over-month growth both exceeded expectations, but the 2.4% year-over-year CPI increase still marked the lowest level since February 2021. PPI was flat month-over-month, indicating that inflation is cooling further.
Goldman Sachs economists analyzed that while the September CPI and PPI inflation data was mixed, the final readings were still close to expectations, indicating that US inflation is progressing towards the Fed's 2% target, and the Fed is nearing its inflation goal.
After the release of this week's two major inflation data points, traders are almost certain that the Fed will cut interest rates by a quarter percentage point at its meetings in November and December.
US Presidential Election
Historically, the crypto market has often seen an upward trend around the time of the US presidential election results. On November 5th, the results of the US presidential election will be announced, with only 20 days remaining.
Furthermore, Bloomberg reported that even Harris, a presidential candidate who has not had much close connection with the crypto market, is also making efforts to win votes.
On Monday, Harris proposed a new plan to provide loans to Black entrepreneurs and others facing financing barriers. According to Harris' campaign platform to attract Black male voters, the plan will provide 1 million loans, with up to $20,000 in potential forgiveness. Harris also promised to support a regulatory framework for cryptocurrencies, providing more investment certainty for the 20% of Black Americans who own or have owned digital assets.
The DeFi lending project World Liberty Financial of the Trump family has also been active recently, introducing several experienced executives in addition to planning to publicly issue the WLFI token.
Data from Polymarket shows that as of now, Trump's odds of winning are significantly higher than Harris'.
The market currently leans more towards the view that a Trump presidency would be positive for the crypto industry, but given that both US presidential candidates have expressed crypto-friendly sentiments and positions, the negative impact would be negligible regardless of who takes office.
During the bull market from 2016 to 2020, the crypto market, led by BTC, experienced strong upward trends under the Republican Trump administration. From 2020 to 2024, the market will be under the Democratic Biden administration. The crypto market has seen powerful bull markets under both their respective tenures.
Looking at the market's historical performance over the past two cycles, neither a Republican nor a Democratic presidential candidate taking office has impacted the upward trend of the crypto market.
After the election results are officially announced, some of the capital that has been waiting and observing may abandon its hesitant and cautious approach and choose to boldly bet on the crypto market.
Future Market Outlook
Coinbase Analyst: Macroeconomic Factors Affecting Crypto Performance Shifting from Monetary Policy to US Election Results
Coinbase analysts David Duong and David Han stated that although Bitcoin's price performance has been lackluster this week, "market sentiment has remained largely unchanged, with the past week's perpetual contract funding rates and open interest remaining stable, indicating this." The Coinbase analysts pointed out that the macroeconomic factors affecting crypto performance are shifting from monetary policy to the US election results, despite the recent rise in CPI and core PPI, the market's expectations for rate cuts remain largely stable.
They also mentioned that China's fiscal policy briefing this Saturday may indirectly impact the crypto market, especially during the time when many markets will be closed. The crypto market may be used to express a proxy view on the scale and intensity of any fiscal policy announcements.
Bitfinex: BTC Short-Term Holder's Realized Price a Key Resistance
The latest Bitfinex Alpha analysis report emphasizes that the short-term holder's realized price (around $63,000) has become a key resistance level. Breaking through this level could trigger further upside, while failure could lead to a retest of the $59,000 or even $55,000 support levels.
Bitfinex Alpha believes the market is still in a passive state, and the future trend will depend on whether Bitcoin can break through the short-term holder's realized price. It advises traders to be wary of potential pullbacks, while also preparing for the possibility of a strong rebound.
