The United States’ next presidential announcement is merely hours away, and investors expect Bitcoin to react.
Analysts foresee a 10% swing in the cryptocurrency's price in either direction, depending on who emerges as president.
Bitcoin, in the meantime, is gaining ground when it comes to dominance.
Benjamin Cowen believes that this might cause one last reckoning—or crash for the Altcoin market before recovery in January 2025
The United States’ presidential election winner is hours away.
As a result, several financial sectors, including the stock and crypto markets, are preparing for increased market volatility.
This time around, analysts predict that Bitcoin could see a price swing of at least 10% this week, depending on who emerges as the next president of the United States.
Bitcoin is now swinging wildly up and down and is on the verge of breaking below the $68,000 mark.
This pivotal moment could be the start of a significant turning point for the crypto industry as a whole.
Let’s see some of the possible developments set to happen this week.
It is worth mentioning Bitcoin’s volatility index recently hit a three-month high.
This means that BTC is now one of its most uncertain times.
In the days leading up to the election, the cryptocurrency soared to a high of $74,649 on 29 October.
Soon after this, it retreated to below $70,000 as the FUD around the election increased.
According to a recent post from analyst and investor Daan Crypto Trades, Bitcoin's close from last week looks “unclean.”
He further stated that the asset's next move (to the upside or otherwise) will depend mainly on who wins the election.
In essence, a victory from either candidate could trigger a 10% price shift—and investors have no way of telling which will happen.
Bitcoin's close wasn't the cleanest.
Tony Sycamore of IG Markets echoed this sentiment, noting in a separate tweet that a decisive move above $74,000 could push Bitcoin toward the $80,000 mark.
On the other hand, a retreat below the $65,000 could push Bitcoin lower.
With all of this in mind, investors are currently on edge and are watching Bitcoin’s price movement around this $65,000 price level.
When it comes to Bitcoin's future, one more thing to consider is the Federal Reserve’s recent interest rate cuts.
In September, the US Federal Reserve cut its interest rates by another 50 basis points, and more cuts are expected.
When interest rates are lower, investors are encouraged to consider high-risk assets like crypto.
They might also lose significant interest in traditional assets like gold or oil while doing so.
If this trend continues, the crypto market (Bitcoin especially) might not be so affected if the market declines.
Instead, it might benefit from renewed investor interest and more capital inflows.
Amid this trend, Bitcoin's market dominance is also on the rise and currently sits at around 60.7% at the time of writing.
Bitcoin is leading the altcoin market.
This means that the flagship cryptocurrency has been strongest since March of 2021.
Simply put, Bitcoin is leading the altcoin market by a wide margin.
Analysts are generally more optimistic about Bitcoin than they are about the Altcoin market.
Benjamin Cowen, for example, the founder of ITC Crypto, believes that Altcoins could be set for one last nuke before recovery.
Cowen believes that this price drop might be similar to that of the 2019 bear market, when crypto prices dropped significantly before rebounding towards 2021.
Cowen also believes that the Altcoin market could drop now and continue downward until January 2025,
When this happens, the market might stabilize again and recover.
Despite the current slump in Altcoin values, some traders remain optimistic.
The altcoin season index
The altcoin season index shows that the market is currently far from being in a bitcoin season.
However, historical patterns show that “altseasons” tend to follow Bitcoin’s post-halving rallies.
This trend was observed in 2017 and again in 2021, and crypto analysts are divided.
While some expect an altcoin boom, others argue that Bitcoin holds too much dominance for a sustained altcoin season to occur.
Keep in mind that the last weekend was especially brutal for the Altcoin market.
The sector’s market cap dropped to a value of around $2.4 trillion, with Altcoins bleeding red between Friday and Sunday.
Investors should pay special attention to the coming days and weeks for Bitcoin, as they are expected to be crucial for the cryptocurrency.
The US election outcome is bound to drive the market’s volatility to a large degree.
All of this combined with the continued interest rate cuts and high volatility has contributed to a tense ennvironment for crypto.
Investors who are risk-averse might want to approach the market with caution between now and the rest of the week.
Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information but will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.