On Friday (October 4), Bitcoin held onto $61,000, but it still fell below it in the short term. Billionaire Elon Musk warned that the United States is heading for bankruptcy, with the country's debt increasing by $204 billion in one day. Former US President and Republican presidential candidate Trump said that if he won the election, he would save Silk Road founder Ross Ulbricht, which stimulated the US November election victory rate to flash a "golden cross".

Musk previously disclosed details of his secret meeting with pro-Bitcoin El Salvador President Nayib Bukele after warning that the United States is heading for bankruptcy as the country’s debt increased by $204 billion in a single day.

“The United States is heading for bankruptcy,” he wrote Thursday, again attaching an Oct. 1 report on a surge in U.S. debt.

EJ Antoni, an economist at the conservative Heritage Foundation, wrote: "The federal debt exploded on the first day of the new fiscal year, jumping $204 billion to a new high of $35.669 trillion, but the situation is even worse. The Treasury also had to use $72 billion in cash balances, which means that the deficit in just one day exceeded $275 billion."

In September, Musk met with Bukele, who made history by making Bitcoin legal tender in El Salvador in 2021. Bukele predicted that America’s days may be numbered.

According to an analysis by the Congressional Budget Office earlier this year, U.S. debt interest payments are expected to reach $870 billion this year as runaway inflation forces the Federal Reserve to raise interest rates at an unprecedented pace after massive spending and money printing during the COVID-19 pandemic.

The U.S. national debt has soared in recent years, breaking the $34 trillion mark in early 2024, largely due to the COVID-19 pandemic and lockdown stimulus measures.

“Since neither the Republicans nor the Democrats have properly addressed the growing debt and deficit issues in the U.S. in this election, this will be very positive for Bitcoin, especially after the U.S. election,” said CK Zheng, chief investment officer at crypto hedge fund ZX Squared Capital.

Earlier this year, Bank of America analysts warned that the U.S. debt burden will increase by $1 trillion every 100 days — which could drive up Bitcoin prices — and could reach $36 trillion by the end of 2024.

Last month, the Fed kicked off a rate-cutting cycle with a 50 basis point cut that somewhat surprised markets and fueled expectations of a similarly sized cut in November — something BlackRock’s CEO called “crazy.”

Bitcoin prices have swung this week as tensions in the Middle East escalate between Israel and its neighbors, raising concerns that the regional conflict could spiral into a wider war — highlighting Bitcoin’s role as a hedge against the dollar and debt.

“Watchers of the bitcoin price this week will note once again that it is not a safe haven against geopolitical concerns,” Geoff Kendrick, head of cryptocurrency research at Standard Chartered, wrote in an email. “I think this is normal, gold is a geopolitical hedge. Bitcoin is a hedge against (traditional finance) problems, such as bank failures or de-dollarization/US Treasury sustainability issues.”

In a Truth Social post on Wednesday, Trump promised to "save Ulbricht" in response to Ulbricht discussing the start of his 12th year in prison.

According to data from Polymarket, a large cryptocurrency betting platform, the U.S. election victory rate in November flashed a "golden cross", with Trump surpassing Vice President and Democratic presidential candidate Kamala Harris to 50%. As of press time, both of them tied at 49%.

Bitcoin Technical Analysis

Cryptocurrency analyst Mikybull Crypto has given a bullish outlook for Bitcoin prices, predicting that the cryptocurrency will breakout after experiencing its fifth impulsive wave of gains before the end of October. His prediction comes against the backdrop of several external factors that could cause Bitcoin to fall below $60,000 as the negative start of “Uptober” continues.

Mikybull Crypto predicted in a Twitter post that a Bitcoin price breakout will occur this month. Specifically, he said that the breakout into the 5th wave of expansion should occur on "expected October 22nd." He added that for now, market participants must weather the inconvenience of the 4th wave of extended correction. He also advised investors not to panic because the breakout is just around the corner.

The accompanying chart he shared shows that when the fifth wave of expansion occurs, the price of Bitcoin could reach between $95,000 and $120,000. This means that the flagship cryptocurrency could hit a new all-time high (ATH) this month. However, the analyst did not say whether this would mark a cyclical top for the price of Bitcoin.

His prediction is in line with that of 10x Research founder Markus Thielen, who predicted that Bitcoin will hit a new high by the end of October. However, Thielen gave a more conservative prediction, highlighting that $75,000 is a possible price target for Bitcoin by the end of October. This is still higher than Bitcoin's current high of $73,000.

The fourth wave of extended price correction mentioned by Mikybull Crypto could lead to a drop in the price of Bitcoin. In the event of an impending attack in Israel, the price of Bitcoin is already at risk of falling to $57,000. Therefore, Bitcoin is likely to lose its critical support level of $60,000 soon.

Cryptocurrency analyst Ali Martinez also provided insights on how Bitcoin could fall to $57,000. The analyst said that $60,365 is a key level to watch. He added that if $60,365 falls below, the cryptocurrency could fall to $57,420. However, if Bitcoin stays above this level, he said a rally to $63,300 is possible.