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- Crypto Saving Expert Newsletter - Issue 119
Crypto Saving Expert Newsletter - Issue 119
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Good morning! With the U.S. Presidential election on Tuesday and a Federal Reserve interest rate announcement on Thursday, this week promises to be action-packed for the markets. Let's dive in for a closer look at what is going on behind the scenes with bitcoin and the overall Web3 market. 👇
This week's issue will feature technical analysis of bitcoin, election history, and the S&P 500, as well as important dates and key news stories.
Table of Contents
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A Busy Week For Bitcoin
With the US Presidential election occurring on Tuesday and a Federal Reserve interest rate decision on Thursday, it is set to be a busy week for the markets.
Bitcoin Outlook
Bitcoin suffered six red days in a row after Monday’s candle close. This followed the failure to break the all-time high.
However, it could also be depicted as a sign of de-risking by market participants heading into the US election today.
From here, bitcoin could flip the low time frame S/R level and open the door to a potential rally. Still, with volatility expected over the next few days, a further drop is possible.
Election History
Bitcoin has a history of rallying after the US election. In 2012, 2016, and 2020, bitcoin witnessed a large upside move in the months after the event.
With bitcoin positioned very close to resistance, it could break out and begin a phase of upside expansion, mirroring the past price action.
S&P 500
Over in the S&P 500, the stock market has also historically pushed higher following US elections.
The S&P 500 also rallied beforehand, much like it has done this time. Bitcoin will rely on the stock market to continue its current trajectory and enter a leg higher towards $100,000.
This could take the S&P 500 towards $6,000 if the trend remains unchanged.
Stonksy
The above image shows an example of Stonksy indications. This particular chart was the 30-minute bitcoin chart.
As seen, Stonksy turned to the green background around $67,000 and caught the pump up towards $73,000. Afterwards, Stonksy closed the green period and switched to red.
Stonksy caught the drop back down after entering the red, providing back-to-back sizable moves on the 30-minute chart over the last week.
Stonksy can be applied to any time frame, we recommend backtesting on new time frames to ensure accuracy.
Fear & Greed Index
The Fear and Greed Index remains within Greed at 70 despite bitcoin’s retrace from $73,000.
The Index suggests that investors remain positive in a week primed with external events. If bitcoin moves back towards the highs, the Index could push higher and potentially into Extreme Greed.
However, a drop towards $64,000 could see a blanket of fear cover the market after another failed attempt at breaking resistance.
Important Dates
Tuesday 5 November, All Day - US Presidential Election
The U.S. Presidential Election is the appointment of the next President and Vice President. The election result could determine the next route for bitcoin and the crypto market. Voters will elect all 435 members to the US House of Representatives and 33 members to the Senate.
Tuesday 5 November, 15:00 UTC - ISM Services PMI
The Institute for Supply Management (ISM) releases this data, with it providing a measure of the US non-manufacturing sector. It is considered positive if the figure is above the 50 mark.
The consensus is set at 53.8, with the previous data at 54.9.
Thursday 7 November, 19:00 UTC - Fed Interest Rate Decision
The Federal Open Markets Committee meeting occurs eight times a year. The Fed meets to discuss recent economic data and the strength of the US economy before deciding whether it should increase, decrease, or leave rates unchanged.
The Federal Reserve is composed of a Board of Governors that assists its Chair, Jerome Powell, in making interest rate decisions and steering the US economy.
At 18:00 UTC, the Fed will announce its interest rate decision. Afterwards, a press conference will begin at 18:30, where Powell will conduct a 30-minute speech before taking questions from the press.
The consensus is that the Fed will cut rates by 0.25%.
Friday 8 November, 15:00 UTC - Michigan Consumer Sentiment Index
The University of Michigan releases the index, a survey depicting consumer confidence in the economy. The survey provides insight into consumers’ confidence to spend money within the US economy.
The Index’s score is set to come in at 71, with the previous data coming in at 70.5.
Gainers
Losers
Crypto Market Liquidations Near $230m as Bitcoin Dips Below $69,000 Before US Election
Crypto liquidations surge to $230m as Bitcoin briefly dips below $69,000 ahead of the U.S. presidential election. Discover how election volatility and political uncertainty impact Bitcoin's price and market sentiment.
As Bitcoin dropped below $69,000, crypto market liquidations surged to nearly $350m, highlighting increased trader anxiety just days before the US presidential election on 5 November.
According to CoinGlass, $229.10m was liquidated on 3 November, including $142.99m in long and $86.11m in short positions. This marks the most significant daily liquidation since 25 October, when Bitcoin failed to hold above the $70,000 threshold.
Bitcoin Price Volatility Intensifies as Election Nears
Over the past week, Bitcoin has experienced significant price fluctuations, starting around $67,700 on 28 October, reaching a high of nearly $73,300 on 29 October, then dropping to a low of $67,719 on 3 November. The price quickly rebounded, currently trading at $68,886 according the data from CryptoSavingExpert.
US Election Influences Bitcoin Market Sentiment
Bitcoin’s recent price swings coincide with a tightening odds gap between US presidential candidates Donald Trump and Kamala Harris on the crypto-focused betting platform Polymarket.
Trump’s odds peaked at 67% on 30 October but dropped to 53.8% on 3 November as the election nears. The odds of a Trump victory on 5 November have since increased to their current level of 57.1%.
These odds have decoupled from traditional polls as the election has closed in. Traditional pollsters have the race as being far closer, with many slightly favouring Kamala Harris to win, but few polls have clear daylight between the two candidates.
The crypto community generally views Trump as a more favourable candidate for digital assets, given his pledges to fire SEC Chair Gary Gensler and position the US as a leader in crypto. Conversely, Harris has proposed a cautious regulatory framework for the industry, aimed at promoting responsible crypto use.
Bitcoin Price Predictions Following the Election Outcome
As Election Day draws near, traditional polling data shows Trump and Harris are nearly tied, with Harris holding a narrow 0.9-point lead as of 3 November, according to FiveThirtyEight polling.
Some traders speculate that a Trump victory could drive Bitcoin’s price to $100,000, while Bernstein analysts predict a possible price drop if Harris wins. Crypto trader Daan Crypto Trades expects a potential 10% price swing for Bitcoin, depending on the election results.
The increased market sensitivity ahead of the US presidential election illustrates how political events and macroeconomic factors continue to have a significant impact on Bitcoin price trends and crypto market dynamics.
Florida's Secret Crypto Fortune: $800m and Counting
Florida’s CFO says the state aims to be an economic leader and innovator and is for Trump’s idea of creating a national Bitcoin and crypto “stockpile.”
The US State of Florida is leading the charge in embracing crypto as an investment.
During an interview with CNBC, Jimmy Patronis, the state’s Chief Financial Officer (CFO), disclosed that Florida held a crypto stash worth $800m.
“We have about 800 million dollars in crypto-related investments in our state portfolio. But I would not be shocked to be able to see that growing under a Trump administration in the near future,” he stated.
Mr Patronis added that he was looking to convince the state’s board of administration to allow pension funds for teachers, firefighters and police officers to invest in Bitcoin and cryptocurrencies to guarantee the best returns for their investments.
He explained, “Crypto is not going anywhere. It is not going to contract. It is going to continue to be expanding, and I think we’d be a fool if we are not prepared to do everything we can to harness the opportunities there…We need to be prepared for what crypto can bring to our investment portfolio.”
Florida’s CFO had also addressed the same issue in a letter on Tuesday addressed to the Executive Director of the Florida State Board of Administration.
In it, he praised the state for being a global economic leader and innovator. He also supported former President Trump’s idea of establishing a crypto presidential advisor council and a national Bitcoin “stockpile” using seized BTC held by the US government.
A CBDC is Government Overreach by the Federal Government
Concerning Florida Governor Ron DeSantis' recent signing into law of a bill protecting Floridians from the government looking into their personal finances through a Central Bank Digital Currency (CBDC), Mr Patronis told CNBC that such protections were necessary to fight against “government overreach and woke corporate monitoring.”
“We need to be able to have a hedge against this massive overreach by the federal government with a centralised currency,” he said.
“I don’t want the federal government knowing that my son went to the grocery store to buy a bag of Doritos at 2:15 in the afternoon. So we need to have some protections in place,” he added.
Trump’s 2024 Election Lead on Crypto Prediction Markets Surpasses Traditional Polls
Crypto prediction markets like Polymarket show Trump’s 2024 election odds climbing well above traditional polls. Is crypto-based betting giving a more accurate forecast for November?
An emerging trend in crypto-backed prediction markets is reshaping the 2024 U.S. presidential election narrative. Over the past month, platforms like Polymarket and Kalshi, where users place crypto-based bets, have consistently shown Donald Trump holding a decisive lead over Kamala Harris.
This starkly contrasts traditional polling data, which reflects a closer race or, in some instances, favours Harris.
To explore this disparity, you can compare the election odds from prediction markets such as Polymarket and Kalshi and traditional bookies with those from mainstream polling sources, including the New York Times (NYT).
This growing gap raises critical questions about the reliability and influence of crypto-driven prediction markets on US election forecasts.
Crypto Markets Show Strong Trump Odds vs. Tight Race in Traditional Polls
Crypto-friendly platforms Polymarket and Kalshi currently give Trump winning odds of 61.9% and 57%, respectively. On Polymarket, this figure has been as high as 66.9% before its recent dip as the election looms. Interestingly, the traditional betting markets appear to also favour Donald Trump, with his shortest odds standing at 4/7, compared to Kamala Harris, who stands at 11/8. Translated into a percentage value, Trump has around a 60% chance compared to Harris’s 40%, which aligns these markets with the prediction markets.
In contrast, traditional polling averages show a much closer race: Nate Silver’s poll lists Trump at 47.4%, and the NYT shows 48%. This divergence between gambling markets and polls has sparked a debate: are predictions and betting markets delivering more accurate predictions, or are they influenced by gamblers and traders?
Over this year, prediction markets, though newer and without a proven track record, have garnered significant media attention, with frequent citations of crypto-fueled odds as evidence of Trump’s momentum. Despite their relative novelty, these platforms are drawing more interest than ever in the US election.
Trump’s Pro-Crypto Stance Drives Favorable Odds on Prediction Markets
Trump’s connection to the crypto community is evident.
From speaking at recent bitcoin conferences and hosting NFT events to advocating policies like renaming seized digital assets the “strategic national bitcoin stockpile,” he has made efforts to align with pro-crypto voters. Additionally, he has vowed to protect the industry from restrictive regulations championed by figures like Senator Elizabeth Warren. Harris, conversely, has taken a more cautious approach to crypto, promoting innovation broadly but offering fewer specific policies.
These actions have likely contributed to Trump’s favourable odds on crypto platforms, where pro-crypto traders are increasingly betting on his success. Polymarket and Kalshi have thus shown Trump with a significant lead over Harris, a sharp contrast to traditional polling averages, which still reflect a close race.
This same effect could be visible in the gambling markets, too. As the more well-known candidate, Trump will generate more individual bets than Kamala Harris, thus reducing his odds of winning as the bookies make the odds reflect the betting market as odds given by bookies are fluid and highly data-driven.
This effect may mirror sports betting, where the favourite to win is not always the most likely winner. Consider England's perennial candidacy as the most likely winner of the European Championships or World Cups. This effect is typically ‘baked in’ to the odds due to the sheer number of bets placed on England to win these tournaments.
Prediction Market Influence vs. Traditional Polling Systems?
The media attention surrounding prediction and gambling markets raises the question: are these markets offering a more accurate election forecast, or are they driven by niche sentiment?
While traditional polls show a tight race, these prediction markets could be swayed by the unique dynamics and sentiments of the community using these platforms.
As Election Day approaches, only the actual results on 5 November will determine whether the predictions are more reliable than traditional polling averages.
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