As a seasoned analyst with over two decades of experience in the financial markets under my belt, I have seen my fair share of market uncertainties and volatilities. The current state of Bitcoin (BTC) is no exception, as it dances around a tight trading range ahead of the US Presidential Election.
For about two weeks now, Bitcoin (BTC) has been moving within a narrow trading band, mainly due to traders keeping a close eye on the upcoming U.S. Presidential Election scheduled for November 5th.
Tight US presidential race keeps Bitcoin flat
In simpler terms, the value of Bitcoin has found it difficult to consistently stay above $69,000 throughout October. Each time it tries to surge past this level, there’s a subsequent drop back toward an increasing support area that ranges between $64,000 and $67,000.
Over the course of the coming week before the U.S. presidential election, the fluctuations in the value of this digital currency are becoming more limited.
The main reason for this is the conflicting feedback from surveys involving Donald Trump, who appears supportive of cryptocurrencies, and Kamala Harris, whose views on digital assets are not clearly defined.
As an analyst, I find myself grappling with intriguing contrasts between two distinct perspectives on the upcoming race. The CBS News/YouGov poll indicates a close contest, with Vice President Harris narrowly leading President Trump by 1% among likely voters (50% to 49%). Yet, the betting data from Polymarket presents a striking contrast, suggesting a significant advantage for Trump, with approximately two out of three chances (66.5%) of winning, while Vice President Harris’s odds are at 33.5%. These disparities underscore the complexity and unpredictability inherent in predicting election outcomes based on different data sources.
An administration supportive of cryptocurrency may result in beneficial regulations, whereas a more conservative or uncertain approach could bring about tighter supervision. This uncertainty leaves traders hesitant, as they wait for the election outcome to clarify the direction, before making significant decisions.
Bitcoin ETF demand absorbs selloff pressure
The price of Bitcoin remains stagnant as a result of differing perspectives among U.S. individual investors and large financial institutions.
On October 25th, the Coinbase Premium Index, a gauge tracking the Bitcoin price gap between Coinbase (a U.S.-based exchange) and platforms such as Binance, reached its lowest point for the year at -0.20. This suggests that there is increasing selling pressure from American retail investors.
Instead, it’s worth noting that Bitcoin Spot ETFs, typically preferred by US institutional investors, saw a record weekly influx of approximately $402 million on that particular day.
Furthermore, significant investments such as Emory University putting $15 million into a Spot Bitcoin Exchange-Traded Fund demonstrate that these institutions continue to have faith in Bitcoin’s future potential.
Bitcoin is confirming a bull flag breakout
Currently, Bitcoin is examining the upper boundary of its bull flag formation as potential support, following its surge past this line on October 15th. This indicates that Bitcoin doesn’t currently possess enough continuous power to unequivocally validate a clear breakout.
The price action has led to a stabilization phase near the $68,000 mark. Additionally, the activity during breakout attempts has been relatively average.
In an ideal scenario, confirming a breakout from a bull flag usually involves a significant increase in trading activity (volume), which signifies robust buying enthusiasm.
In the Bitcoin market, traders tend to wait for a strong indication before taking on substantial investments, resulting in little fluctuation or movement in prices.
Furthermore, the Relative Strength Index (RSI) currently hovers near 60, implying that Bitcoin is in a relatively strong and bullish period, but not yet showing signs of being excessively bought or overbought. This leaves potential for further growth if trading activity increases.
Should Bitcoin successfully confirm its breakout, you can estimate the potential technical target based on the bull flag pattern by taking the height of the flagpole and adding it to the breakout point’s position. This method indicates a possible price goal near $101,608.
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2024-10-28 15:53