Analysts predicted a continued increase in Bitcoin following Trump's victory

The cryptocurrency community reacted positively to Donald Trump's victory in the presidential race for the United States. Amid the fierce competition between Democrats and Republicans, Bitcoin reached a new all-time high of $75,400.

New Incentives

Trump, who positions himself as an advocate for digital assets, is seen as a potential catalyst for new incentives and growth opportunities in the crypto market. His commitment to reassessing SEC actions may ease regulatory pressures on the industry and attract institutional investors, notes Gleb Kostarev, CEO of Blum.

“If the Trump administration follows through on its promises, we could witness an influx of capital into crypto assets and strengthen their role in the global economy. With greater regulatory clarity and backing from major players, cryptocurrencies may start to integrate more actively into traditional financial systems,” the expert stated.

Kostarev also emphasized that along with signals for growth, political uncertainty and possible regulatory changes could induce volatility in the market. He advised investors to be mindful of the potential risks.

More Than Just Elections

In addition to the presidential elections in the US, Bitcoin’s price is currently influenced by expectations of a further reduction in the key interest rate, according to Ryan Li, chief analyst at Bitget Research. The next FOMC meeting is scheduled for Thursday, November 7.

According to a FedWatch survey by CME Group, 97.6% of investors anticipate a 25 basis point decrease in the key rate to between 4.5% and 4.75%.

“A second consecutive reduction in the key rate indicates that the American regulator perceives a clear downward trend in inflation within the economy. This would likely boost risk appetite in both the stock market and the crypto sector and support the rise of risk assets such as stocks and cryptocurrencies,” Li believes.

He added that the fear and greed index has not shown a significant spike and remains in a neutral zone around 54 points.

Where Will Bitcoin Head?

In the next 24 hours, the crypto market is expected to experience significant volatility, according to Alexander Peresichan, CEO of Tehnobit.

“We can expect several attempts by Bitcoin to break resistance levels around $76,500 and possibly $78,000. However, following a period of growth, traders will likely begin to massively sell to secure profits, leading to a correction in value to between $72,000 and $70,000,” the expert predicts.

Fear in the crypto market dissipated early during the vote count, leading to substantial Bitcoin purchases on the spot market, said trader Vladimir Cohen. He pointed out that the decisive factor was the lead in votes from seven battleground states affecting the election outcome, along with an advantage in Florida.

“Traders moved fast, trading on expectations, and we saw a breakout at the historic high and a local peak at $75,500 ($76,170 on CME). The rise has yet to stop, but I do not anticipate a massive surge,” the expert shared.

Cohen explained his outlook by noting that until Donald Trump's inauguration on January 20, 2025, the current president Joe Biden remains in office, along with the Democratic administration and Gary Gensler as the SEC chair. Legal actions against various crypto projects are still active, and Democratic repression of the industry may continue.

According to the trader, greed and euphoria are currently driving the market upward, but this trend is likely to end after the Federal Reserve meeting on November 7. The rate is expected to be decreased by 0.25%, while the Fed hasn't yet shifted away from its tight monetary policy as its balance sheet continues to decline without the long-awaited liquidity influx, he noted.

“I expect today [November 6] to see a slight update of the historical maximum to levels of $76,000–$78,000, although most analysts are looking at $80,000 as a near target,” Cohen added.

Whales Accumulating Digital Gold

According to analysts from Lookonchain, large holders of Bitcoin are accumulating coins in their wallets in the current environment. In just one hour, 11 new wallets withdrew 1,807 BTC (approximately $132 million at the time of the transactions) from Binance.

Whales are accumulating $BTC!

11 fresh wallets withdrew 1,807 $BTC($132M) from #Binance in the past hour.

Address:
bc1qp8ahkl9g28grz4f44ljs2ukjccx6q5yxez7nt4
bc1q76yr34th8ngnxj0pjs9d9vtxrtlyu07y3lsspj
bc1q2vw84cghpyg463g8w4uz734uxl7wstvsemgcec… pic.twitter.com/ZpP2qhXiHT

— Lookonchain (@lookonchain) November 6, 2024

Another whale has gone long on Bitcoin through recursive borrowing. They borrowed $27 million from Aave to purchase 366.31 WBTC at an average price of $73,708 within two hours.

A whale is long $BTC again via recursive borrowing!

The whale borrowed $27M from #Aave to buy 366.31 $WBTC at an average price of $73,708 in the past 2 hours.

Address:
0x488b99c4A94BB0027791E8e0eEB421187EC9a487 pic.twitter.com/6eQEE6I3Y3

— Lookonchain (@lookonchain) November 6, 2024

In the last 24 hours, the liquidation volume for short positions on Bitcoin exceeded $217 million, as reported by CoinGlass.

At the time of writing, the first cryptocurrency is trading at $74,392, according to CoinGecko.

It is worth noting that in mid-October, rising chances for Trump's election victory brought back inflows into crypto funds.

Earlier, Tyr Capital and Bitget Research warned of heightened price volatility for Bitcoin following the announcement of the election results. A similar sentiment was shared by Standard Chartered.