Main Points:
- Bitcoin could potential ly reach its previous all-time high of $73,737.9 on the US presidential election day, according to SCB’s Jeff Kendrick.
- Bitcoin is currently trading at $68,520.
- If Trump wins, Bitcoin could experience a 4% post-election rise, followed by a 10% increase in the coming days.
- A Republican victory could push Bitcoin’s year-end target to $125,000, while a Harris victory might initially lead to a decline but recover to $75,000 by year-end.
- Recent trading activities and option markets signal strong price movements, with key option levels at $80,000.
Election Countdown: Bitcoin’s Potential Surge
With just 12 days remaining before the US presidential election, analysts are closely watching the cryptocurrency markets, especially Bitcoin. According to Jeff Kendrick, the Global Head of Digital Asset Research at Standard Chartered Bank (SCB), Bitcoin could revisit its March 2024 all-time high of $73,737.9 by November 5, the election day in the US.
Kendrick’s prediction is rooted in thorough analysis of Bitcoin’s derivatives markets and trading volume indicators. At present, Bitcoin is trading at $68,520, positioning it within striking distance of its historical high. Kendrick noted that Bitcoin’s movement around election day will largely depend on market sentiment, which is expected to accelerate as election results unfold.
Impact of a Trump Victory on Bitcoin
One of the key takeaways from Kendrick’s analysis is the potential for a sharp increase in Bitcoin’s price if former President Donald Trump secures a win. He highlighted that, should Trump win the presidency, Bitcoin could initially experience a price bump of around 4% from its breakeven point—this refers to the exercise price plus the premium in options markets. Kendrick expects this price increase to grow over the subsequent days, reaching a total rise of approximately 10%.
This is particularly tied to what Kendrick referred to as the “Trump trade,” where supporters of the former president are likely to make bullish moves on Bitcoin, potentially driving its price higher. Kendrick emphasized that Trump’s victory would bolster confidence in deregulation and a pro-business climate, factors that would favor the cryptocurrency market.
The Significance of Option Markets
Kendrick’s outlook also pays close attention to Bitcoin’s option markets, specifically call options set to expire on December 27. He noted that a large open interest exists for Bitcoin at an $80,000 strike price. This indicates that many investors are betting on a significant upward movement in Bitcoin’s price, potentially leading to a rapid climb toward that level.
Kendrick pointed out that these market dynamics suggest a strong possibility of a post-election price surge, particularly as more investors flock to Bitcoin. This behavior would be further driven by Trump’s electoral success, which could pave the way for reduced regulatory oversight and greater market freedom for cryptocurrencies.
Republican Victory: A Boost to Bitcoin’s Year-End Target
Kendrick’s analysis goes beyond just election day price predictions. He projected that if the Republican Party wins control of both houses of Congress, Bitcoin could be on track to reach a year-end price target of $125,000. This would mark a massive increase from its current price and signal widespread market optimism toward Bitcoin’s potential under a Republican-led government.
The analyst argues that Republican policies, which are typically seen as favorable to business and financial markets, would create an environment conducive to Bitcoin’s growth. Investors may view this political scenario as an opportunity to hedge against inflation and take advantage of tax-friendly policies, further driving demand for Bitcoin.
Kamala Harris Victory: A Different Scenario
On the other hand, Kendrick provided an alternative scenario in which Vice President Kamala Harris wins the presidency. In this case, Bitcoin is expected to initially drop in value, though Kendrick projects a recovery toward $75,000 by the end of the year. The decline in Bitcoin’s price following a Harris victory could stem from market uncertainty about her administration’s potential regulatory approach toward cryptocurrencies.
However, Kendrick was quick to note that any dip in Bitcoin’s price under a Harris administration would likely be short-lived. The market’s inherent volatility, combined with long-term bullish sentiment, could help the cryptocurrency rebound in the months following the election.
Recent Market Activity as a Positive Indicator
Kendrick pointed to recent trading activity as a bullish sign for Bitcoin’s near-term performance. Bitcoin has seen consistent upward movement over the past few weeks, and Kendrick attributed this to the “Trump trade” and broader market enthusiasm ahead of the election. Moreover, he highlighted that Wednesday’s brief dip to $65,200 might represent the last major price correction before a strong rally leading up to the election.
In addition to analyzing trading patterns, Kendrick underscored the importance of understanding Bitcoin’s options market, particularly as it relates to price forecasting. With significant open interest in December call options at $80,000, investors appear to be positioning themselves for a major price move in the weeks ahead.
A Crucial Moment for Bitcoin
As the US presidential election approaches, Bitcoin finds itself at a critical juncture. Market analysts like Jeff Kendrick see the potential for a historic price movement, with Bitcoin possibly reaching its all-time high on election day. Should Trump emerge victorious, Bitcoin could enjoy a swift 10% rise, followed by further gains leading into the new year. However, even in the event of a Kamala Harris win, Bitcoin is expected to remain resilient, with year-end projections still hovering around $75,000.
Investors should continue to monitor the options markets, as key strike prices could offer valuable insight into Bitcoin’s post-election trajectory. Whether it’s a Trump-fueled rally or a more measured recovery under Harris, Bitcoin is set to be a focal point in the weeks ahead as the world watches the US election unfold.
