November 1, 2024
Brace for Election Day Volatility as Bitcoin Soars
Dear Subscriber,
 |
| By Juan Villaverde |
Have you been paying attention to Bitcoin (BTC, “A”) this week?
Because I have!
In fact, my eyes have been glued to the original crypto since it smashed past $70,000 on Tuesday to $72,700 on the Bitcoin Liquidity Index (BLX), which compiles data from various exchanges.
That marks the second-highest close in Bitcoin’s history!
Now, Bitcoin is just a stone’s throw away from its all-time high near $73,700, established back in March.
It seems inevitable that the record will soon be broken … and Bitcoin will enter price-seeking mode.
According to my Crypto Timing Model, Bitcoin is indeed on the cusp of setting a new all-time high, gearing up for the next major leap in this bull market that began in November 2022.
That means we’re at the beginning of Crypto’s Golden Window. To learn more about how my Crypto Timing Model sees this window playing out …
And what coins I believe will outperform in it …
I suggest you watch my latest briefing now.
Because when it comes to investing in crypto, timing is everything. And something funny is happening right now.
Just last week Bitcoin struggled to break through the $70,000 ceiling. At the time, the consensus was that any real breakout wouldn’t happen until after U.S. Election Day on Nov. 5.
And in fact, my Crypto Timing Model is still showing a key low is expected for that day.
But here we are, with Bitcoin’s momentum spiking ahead of schedule.
So, what’s causing this unexpected surge? And when can we expect the rest of the market to follow?
While the general expansion in global liquidity plays a big part — as I’ve mentioned before — that may not have been the immediate catalyst for this bullish push.
Instead, Bitcoin’s momentum seems tied to the U.S. election.
This shift first made waves in the bond market:
The blue line above charts the yield from the 10-year U.S. Treasury note.
The yellow line marks sentiment among Polymarket betters as to the likelihood of a Donald Trump victory.
My colleagues Marija Matic and Dr. Bruce Ng have covered Polymarket before. It’s a crypto-based betting platform where you can gamble on everything from sports and pop culture events to election outcomes.
Polymarket isn’t an official poll — you don’t have to be eligible to vote in a U.S. election to bet on its outcome on the platform. The U.S. presidential election is still anyone’s game.
That said, it does give insight into sentiment. And, as I’ve made clear before, sentiment and headlines have been consistent market drivers this cycle.
As you can see above, as confidence in a Trump victory increased, bond yields followed suit.
The market is not just pricing in a probable Trump victory. It’s also anticipating his fiscal and monetary policies, which may bring a renewed bout of inflation.
At least, that seems to be the bond market’s view. And now, we’re seeing the same thing in crypto prices.
How can I tell this is election driven, rather than liquidity driven?
Because Bitcoin’s rally picked up speed this week … even as global liquidity growth slowed over the past ten days.
Here’s the takeaway: As we inch closer to Election Day, the crypto markets are increasingly dialed into the race’s outcome.
News and surprises from the campaign trail could easily trigger added volatility. This sensitivity will likely continue until the next president is decided.
Yet, the breakout we’ve seen in Bitcoin this week isn’t just campaign fluff.
Its path forward is clear: Having passed the $70,000 barrier, Bitcoin is set for new all-time highs.
That means long-term investors can ignore election-induced jitters. In fact, any corrections in Bitcoin over the coming weeks can be considered buying opportunities, not reasons to hit the panic button.
When it comes to the altcoins, we’ll likely have to wait to see how individual projects perform once the volatility has passed.
For more details on which coins I believe will come out on the other side ready to run, you can watch my latest video.
Best,
Juan
Tidak ada komentar:
Posting Komentar