Brief Overview
- As the November 5 US election approaches, Bitcoin is expected to see a potential price increase; however, analysts warn of a potential sell-off.
- Currently, the market capitalization of this largest digital asset is just below $69,000, with the US presidential election just over a week away.
The price of Bitcoin may rise before the US election on November 5, but analysts warn that there could be a sell-off in the days after the election, regardless of the outcome.
"'In the days following the result announcement, profit-taking could put pressure on the Bitcoin price, but at levels below $60,000, buyers should still provide strong support,' Edouard Hindi, Chief Investment Officer of Tyr Capital, told The Block." He added that regardless of the election outcome, Bitcoin could regain momentum in the medium term and set new highs by 2024.
Ryan Lee, Chief Analyst at Bitget Research, reiterated this view, emphasizing that Bitcoin is expected to see significant growth in the coming week as Americans prepare to vote next Tuesday.
"Multiple factors support the potential upside for Bitcoin, particularly the expected interest rate cut by the US Federal Reserve. The market generally expects a 25-basis-point rate cut on November 7, which would bring the rate to the 4.5% to 4.75% range, reflecting an adjustment in the demand for stable economic growth," Lee said.
Lee emphasized that the two-day gap between the US election and the Federal Reserve's interest rate decision could have a significant impact on Bitcoin's price.
"The direction of this impact will depend on whether a candidate supportive of Bitcoin wins," he said.
Potential Bitcoin Sell-Off Pressure Factors
Lee also highlighted that upcoming events, such as an upcoming vote by Microsoft's board of directors on investing in Bitcoin, could affect post-election market dynamics. Microsoft has included "an assessment of investing in Bitcoin" on the agenda for its annual shareholder meeting, scheduled for early December 2024.
"If the board votes against investing in Bitcoin, this could dampen market enthusiasm and hinder Bitcoin's growth," Lee said. Conversely, he noted that if Microsoft decides to invest, it could trigger a significant market rally.
Lee forecasts that within a 70% confidence interval, Bitcoin could fluctuate between approximately $66,000 and $75,000 over the next week, while Ethereum's range could be between $2,350 and $3,200. He also said that improved liquidity could lead to increased Altcoin trading activity.
In the midst of these discussions, Donald Trump's recent interview on The Joe Rogan Experience podcast has garnered over 32 million views, boosting his Polymarket odds to over 66%. However, while cryptocurrencies are associated with the "Trump trade," QCP Capital's analysts suggest that the correlation between Bitcoin and Trump's odds appears to be weakening.
"In October this year, Bitcoin only rose 8%, compared to an average of 21%. If Bitcoin remains at current levels, this would mark the fourth-worst October performance in the past decade," the analysts added.
According to The Block's price page, Bitcoin is currently trading at $68,500. According to data from Coinglass, the global cryptocurrency market capitalization is $2.42 trillion, down 0.9% in the past 24 hours.
