Many crypto industry experts have predicted that Donald Trump’s victory in the US election on November 5 could trigger a major rally in the crypto market. However, some analysts have warned that crypto investors should be cautious in the days and weeks surrounding the election, as there could be many other factors at play.
“A Trump victory will likely bring a sense of euphoria,” Swyftx chief analyst Pav Hundal told Cointelegraph, but also warned that markets will be more volatile in the days surrounding the election.
What Should Traders Expect After the Election? Analysts Say It's Still Open-Ended
Derive founder Nick Forster believes “traders should approach with caution” as the market is currently pricing in significant volatility. He warns that “while there may be upside, the risks are equally significant.”
Referring to Derive options data, Forster stated that traders are preparing for significant price movements around election day.
“The increased options buying suggests some traders are actually betting on a bullish outcome, likely expecting a ‘buy the rumor’ scenario, but in reality could quickly turn to a bearish ‘sell the news’ depending on the actual election outcome.”
Since October 23, Bitcoin (BTC) has gained 7.62%, reaching $72,432 at the time of publication — just 2% shy of its all-time high of $73,679 reached in March.
However, Hundal does not see the election results as “the deciding factor in Bitcoin reaching $100,000.”
He shares a similar view with 10T Holdings founder Dan Tapiero, who said the asset would be worth six figures regardless of which candidate wins.
“Barring some exogenous shock, we should see Bitcoin prices hit six figures before the end of the year. Regardless of who controls the White House.”
'Diversification Strategy' May Be Best, Analyst Says
Whether traders should expect a “buy the news, sell the rumor” post-election sell-off or whether the crypto market will surge if Trump wins remains uncertain, according to Forster.
Forster believes that traders who are able to implement a "diversification strategy" that includes hedging options will benefit more than "going long," especially given the market's "high sensitivity" to domestic and global news.
Meanwhile, Hundal is not too worried about traders timing their trades unless they are very experienced, as he remains confident in growth heading into 2025.
“I’m not sure timing really matters in this environment unless you’re a sophisticated investor looking for short-term arbitrage opportunities based on the US election outcome,” Hundal said.
“There is a real possibility that the market will be volatile based on the outcome of the US election. But the fundamentals of the market are pointing to growth,” he added.
Hundal's comments are in line with the view of David Lawant, head of research at FalconX, in an October 21 market report, that Bitcoin "is likely to do well regardless of the election outcome."
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