Many experts in the cryptocurrency industry have predicted that Donald Trump's victory in the U.S. election on November 5 could trigger a strong rally in the cryptocurrency market.
However, some analysts warn that cryptocurrency investors should be cautious in the days and weeks surrounding the election date, as other factors may be at play.
'Trump's victory could provide a dopamine rush,' chief analyst Pav Hundal of Swyftx told TinTucBitcoin but warned that the market will be more volatile in the days surrounding the election.
What should Traders expect after the election? This remains uncertain, according to analysts
Derive founder Nick Forster believes that 'Traders should approach with caution' as the market is currently pricing in significant volatility. He warns that 'while there is potential for growth, the risks are equally serious.'
Based on Derive's options data, Forster stated that traders are preparing for significant price fluctuations around the election date.
'Buying into bullish calls indicates that some traders are betting on a bright outcome, possibly expecting a 'buy the rumor' scenario, but the reality could quickly turn bearish 'sell the news' depending on the actual election results.'
Since October 23, the price of Bitcoin (BTC) has risen 7.62%, reaching $72,432 at the time of publication — just 2% away from its all-time high of $73,679 achieved in March.
Bitcoin is trading at $72,432 at the time of publication. Source: TradingView
However, Hundal does not view the election results as a 'deciding factor for Bitcoin to reach $100K.'
He agrees with the opinion of 10T Holdings founder Dan Tapiero, who said the asset will reach six figures regardless of which candidate wins.
'Unless there is an external shock, we are seeing Bitcoin prices reach six figures before the year ends. It does not depend on who is controlling the White House.'
'Diversification strategy' may be the best, according to the analyst
Whether Traders should expect a 'buy the news, sell the rumor' dip after the election or a cryptocurrency market boom if Trump wins is still uncertain, according to Forster.
Forster believes that Traders who are likely to implement a 'diversification strategy' including hedging options will benefit more than 'fully buying in', especially since the market has a 'high sensitivity' to domestic and global news.
Meanwhile, Hundal is not too concerned about Traders timing their trades unless they are very skilled investors, as he remains confident in upward growth heading into early 2025.
'I'm not sure how important timing your trades is in this environment unless you are a sophisticated investor looking for short-term arbitrage opportunities from the U.S. election results,' Hundal stated.
It is likely that the entire market will experience significant fluctuations based on the U.S. election results. But the fundamental factors of the market still indicate growth,” he added.
Hundal's remarks align with the views of FalconX's head of research, David Lawant, who stated that Bitcoin 'is likely to perform well regardless of the election outcome,' in a market report on October 21.
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