The most important week of the year has arrived, with the American presidential elections as the absolute headline. Tomorrow the United States goes to the polls and then the counting can begin. For the first time ever, there actually seems to be a lot at stake for the crypto country, and so there is a lot of tension among investors.
And that is reflected in the market. The Bitcoin (BTC) price is fluctuating in all directions and that seems to be just a harbinger of what we will experience the rest of the week.
BTC volatility increases due to elections
Crypto options platform Deribit’s Bitcoin implied volatility index (DVOL), which predicts price movements over 30 days, has risen to 63.24% year-on-year. This is the highest level since the end of July.
In addition, Bitcoin’s 7-day implied volatility, which takes into account the US central bank’s new interest rate decision on Thursday and the possible election results on Friday, has risen to 74.4% year-over-year. This is a lot higher than the 7-day realized or historical volatility of 41.4%.
With a simple look at the Bitcoin price you will quickly come to the conclusion that volatility is currently a lot higher than normal. Yesterday the currency experienced heavy swings, while the weekend almost always guarantees dull price action.
Bitcoin crashed to a low of roughly $67,600 in the afternoon, but late in the evening investors paid more than $69,000 again for the world’s largest crypto. Bitcoin has been hovering around this level for many hours now, but this seems to be the calm before the storm.
Neck-and-neck race: Trump vs. Harris
Most of the crypto market hopes that presidential candidate Donald Trump will walk away with victory. The ‘crypto president’ has announced big plans to advance the industry in the coming years, such as creating a national Bitcoin reserve and pro-crypto regulations.
Never before has Bitcoin or crypto been such an important topic in elections, and that is clearly palpable in the market. In the event of a decline, Bitcoin could find support around $66,000. As long as the price remains above $65,000, Bitcoin will maintain its upward trend of recent months. On the way up, the main resistance to watch is around $70,000.
An interesting fact is that in the past, Bitcoin always started its parabolic bull market after the US presidential elections. In fact, Bitcoin has never fallen to a lower price than on Election Day.
But if Kamala Harris wins, there seems to be a good chance that the Bitcoin price will take a hit. However, it could still go either way: it may be the most exciting election battle ever.
Source: https://newsbit.nl/bitcoin-volatiliteit-schiet-omhoog-in-aanloop-naar-amerikaanse-verkiezingen/
