Main Points:
- Bitcoin’s historical performance in late October shows a doubling in returns compared to the first half of the month.
- The options market suggests bullish sentiment, with significant call options for November and December expirations.
- The U.S. election has a particularly strong impact on Dogecoin (DOGE) and Cardano (ADA).
- Bitcoin could surpass its previous all-time high of $73,697 if current trends hold.
- Post-election, Bitcoin remains poised for further growth, with option traders anticipating a possible surge toward $100,000 by December.
Introduction: Crypto Bull Market Gains Momentum Ahead of U.S. Election
As the U.S. presidential election draws near, cryptocurrency markets are seeing increasing momentum, supported by several factors including economic policies in major economies like China and recent trends in central bank interest rates in the West. Historically, October has been a bullish month for financial assets, and the current upward trend in cryptocurrencies may not be an anomaly. Looking at Bitcoin’s performance over the past decade, the latter half of October has been particularly strong, with returns doubling compared to the first half of the month.
Historical Patterns Suggest Late October Strength for Bitcoin
Data from Coinglass highlights that Bitcoin’s returns in late October (16th-31st) have consistently outperformed the first half of the month from 2013 to 2023. This trend coincides with growing interest in cryptocurrencies as a popular asset class, especially in the wake of the 2020 U.S. presidential election, when digital assets gained widespread attention. This year appears no different, with traders closely monitoring both the election’s outcome and its potential influence on the crypto market.
U.S. Election’s Impact on Cryptocurrencies
A report from the ETC Group, part of Bitwise Asset Management, indicates that Bitcoin prices could experience volatility of up to 10% in either direction based on the election outcome. With Bitcoin’s current spot price hovering around $68,000, a 10% gain would push the price beyond its all-time high of $73,697. Furthermore, Cardano (ADA) and Dogecoin (DOGE) are expected to see the most significant impact, with potential price movements of up to 18% and 20%, respectively, based on election results.
This analysis is backed by historical data from Ycharts, which shows that U.S. equity markets typically bottom out in September or October of an election year and rise in November. A similar trend is currently unfolding in the S&P 500 and Nasdaq, which have both rallied since early September.
The Post-Election Outlook for Bitcoin
Looking beyond the election, Bitcoin continues to exhibit bullish sentiment in the options market. Significant call options for strike prices of $70,000 and $80,000 are set to expire on November 29th, with a notional value of $141 million and $120 million, respectively. The strong bias continues into December, where the most popular strike price is $100,000 for options expiring on December 27th, representing over $620 million in notional value.
Jeff Kendrick, Global Head of Digital Asset Research at Standard Chartered, noted in a recent memo that the digital asset ecosystem could become mainstream regardless of the U.S. election outcome, with both Trump and Harris perceived as favorable for digital assets. This suggests a potential pre-election surge in Bitcoin, possibly pushing it toward its previous all-time high of $73,000.
Conclusion: Bullish Trends to Persist Beyond Election
As the U.S. election approaches, cryptocurrency markets, led by Bitcoin, are poised for continued bullish momentum. With historical patterns pointing to strong returns in late October and the options market reflecting optimism for a price surge in November and December, Bitcoin and other major cryptocurrencies could experience significant gains. Dogecoin and Cardano, in particular, stand to be heavily influenced by the election outcome, but the overall sentiment remains positive for the broader crypto ecosystem. Whether or not Bitcoin reaches new all-time highs by year-end, the growing integration of digital assets into mainstream financial systems suggests that their role in global markets will continue to expand.
