As the U.S. presidential election approaches, traders are expecting significant volatility in Bitcoin (BTC-USD) prices. Recent analysis suggests that the outcome could send Bitcoin soaring or tumbling by a whopping $6,000 to $8,000. According to Greg Magadini, director of derivatives at Amberdata, “I expect a +1.5-Sigma ($6,000 to $8,000 price range) as a result of the post-election price reaction,” as he told CoinDesk.
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Market Watchers Brace for Impact
With the stakes high, Bitcoin isn’t the only cryptocurrency drawing attention. Ethereum (ETH-USD), the second-largest cryptocurrency, is also on traders’ radars. Historically, Ethereum tends to be more volatile than Bitcoin, and the upcoming election is set to keep that trend alive. Traders on decentralized exchanges (DEX) are gearing up for major price movements, anticipating a potential swing of 9.35% to 10.19% in Ether prices, according to CoinDesk.
Magadini’s estimates are backed by current options trading trends. On platforms like Deribit, traders are placing their bets with call options priced significantly higher than puts, signaling a bullish sentiment. Joshua Lim from Arbelos Markets notes that “Bitcoin call options are repricing higher, even while spot price ticks lower this weekend due to surprisingly weak polls for Trump,” indicating that traders are preparing for upward movements despite recent dips, as he explained to CoinDesk.
Election Uncertainty Fuels Volatility
As election day draws near, uncertainty reigns. The tight race between Donald Trump and Kamala Harris has left traders guessing, and the unpredictability of the election outcome means that Bitcoin could experience dramatic shifts in either direction. Lim adds that a 7%-8% move is expected around key events this week, including the Fed rate decision and the election results.
At the time of writing, Bitcoin is sitting at $68,579.51. The chart below shows us the extent of Bitcoin’s daily volatility, with the price fluctuating within a range close to $69,000 before dipping and rising again to around $68,500. Such intra-day movements showcase the ongoing market sensitivity, especially as traders anticipate shifts due to the upcoming elections.
