Trump's election victory sent Bitcoin soaring, briefly reaching $76,000
As the results of the 2024 U.S. election vote count are announced, barring any surprises, Trump will become the new president of the United States, driving Bitcoin to briefly surge to $76,000. However, some analysts warn of the risk of overexcitement and a Sell The News phenomenon for Bitcoin.
According to (Cointelegraph) reports, during the counting of the U.S. election votes on November 6, Bitcoin surged past $75,000, followed by a period of volatility, and briefly reached a high of $76,400 early this morning (7th).
Checkmate, founder of the blockchain data analysis platform Checkonchain, stated that multiple bullish trend lines for Bitcoin are still valid. Over the past few weeks, Bitcoin has reclaimed all key support levels.
However, he also reminded investors to be cautious, as if the market experiences selling pressure, bulls must work hard to defend these support levels.
Trading analysis platform warns of the risk of overexcitement
However, amidst the market optimism, Keith Alan, co-founder of the trading analysis platform Material Indicators, adopts a cautious stance. Upon reviewing order book data, he pointed out that the market is currently filled with speculative behavior.
CoinGlass's order book data shows that as Bitcoin surpassed its historical high, a large number of sell orders concentrated around $75,500, while buy orders were primarily concentrated around $73,000, gradually extending to the $70,000 mark.
Source: CoinGlass Bitcoin liquidation heatmap
Material Indicators further pointed out:
This week we have seen volatility extending in both directions, indicating that election-related bullish news is being fully digested by the market.
Nick Forster, founder of the on-chain options project Derive, also stated that 'volatility driven by the election' may have peaked, predicting that in the short term, volatility will remain above normal levels, but as the election results settle, it may ultimately fall to 4% to 5%.
Bitcoin may first fall back to 'this level'?
If Bitcoin pulls back, what support levels are worth watching? (Cointelegraph) Analysts mentioned the following points:
200 Day SMA and STH-CB
The 200-day Simple Moving Average (SMA), also known as the bull market support line, stood at $63,546 as of November 6; meanwhile, the Short-Term Holder Cost Basis (STH-CB) currently sits at $64,337. These two indicators are typical bull market support levels that investors need to closely monitor.
Medium-term support levels look towards between $60,000 and $65,000
Cryptocurrency analyst Lucky Chart Ape stated that Bitcoin may face a 'drop then rise' scenario in the future, predicting a possible pullback to the mid-range of $60,000 to $65,000, followed by a rebound to around $70,000.
Source: X Bitcoin perpetual contract price trend
Lucky Chart Ape believes that after the election results settle, there may be significant market volatility. However, even if a pullback occurs, as long as Bitcoin can hold key support levels, there remains a chance for a resurgence.
Although news of Trump's potential election victory propelled Bitcoin to new highs, some analysts believe investors should not be overly optimistic. Following a strong upward trend, there may be profit-taking selling pressure, and investors should closely monitor the performance of various key support levels and manage risks appropriately.
[Disclaimer] The market carries risks, and investments should be made cautiously. This article does not constitute investment advice; users should consider whether any opinions, views, or conclusions in this article align with their specific circumstances. Investing based on this is at one's own risk.
