Technical Advantages and Election Tailwinds Fuel Crypto Rally

Technical Advantages and Election Tailwinds Fuel Crypto RallyCryptocurrencies have surged across the board, driven by a confluence of technical advantages, US election optimism, and institutional bullishness. Overnight, Bitcoin price jumped over 3%, breaching the $70,000 mark and reaching a high of $70,107 per coin, while its trading volume soared 140% to over $36 billion

Technical Advantages and Election Tailwinds Fuel Crypto Rally

Cryptocurrencies have surged across the board, driven by a confluence of technical advantages, US election optimism, and institutional bullishness. Overnight, Bitcoin price jumped over 3%, breaching the $70,000 mark and reaching a high of $70,107 per coin, while its trading volume soared 140% to over $36 billion. Other cryptocurrencies followed suit, with Ethereum and Dogecoin rising by 2.4% and 11.7%, respectively.

With the US election day approaching on November 5th, the market widely believes that a win for either candidate will be positive for crypto assets. Wall Street analysts point out that incumbent President Trump has explicitly supported cryptocurrency, making it a "Trump trade." Meanwhile, Democratic candidate Harris has pledged to support a regulatory framework for the industry, a stark contrast to the Biden administration's crackdown on cryptocurrencies.

Geoff Kendrick, Global Head of Digital Asset Research at Standard Chartered, predicts that if Trump wins, Bitcoin will break through $75,000 on election day and potentially reach $125,000 by the end of the year if Republicans control Congress. Conversely, if Harris leads the Democrats to victory, Bitcoin may experience a short-term dip but could still hit a record high of $75,000 by year-end.

As election day draws closer, volatility in the crypto secondary market continues to climb. While Bitcoin's implied volatility has been declining, recent surges in short-term option trading activity suggest investors are preparing for potential market turbulence in November.

Apart from the US election, the crypto rally has been propelled by several other factors:

• Fed's rate cut cycle boosts risk appetite: The Federal Reserve's rate cut cycle has lowered the cost of capital, providing more liquidity for risky assets and boosting market sentiment towards cryptocurrencies.

• Bitcoin DMA indicator crosses above the golden cross, signaling upside: The Bitcoin Momentum Average (DMA) crossing above the golden cross is viewed as a bullish signal, indicating that Bitcoin prices may continue to strengthen.

• Microsoft reportedly to buy Bitcoin, institutional funds flood Bitcoin spot ETFs: Reports suggest that Microsoft plans to purchase Bitcoin, signifying growing institutional recognition of cryptocurrencies. Meanwhile, institutional funds are pouring into Bitcoin spot ETFs, providing further support for Bitcoin's price rise.

• Elon Musk touts Dogecoin on X platform: Elon Musk's public endorsement of Dogecoin on X platform has driven the price of the meme coin upwards and attracted more investor interest.

Fueled by multiple positive factors, the cryptocurrency market is exhibiting robust growth. Looking ahead, the market is poised for broader development, driven by technological advancements, regulatory maturity, and continued institutional interest in crypto assets.