While most investors and traders expected significant volatility during the election period, little happened. Bitcoin (BTC) price remains relatively stable and fluctuates below the critical resistance of $ 14,000.
Meanwhile, Bitcoin’s price has moved along with the equity markets over the past 24 hours.
The weekly chart is showing a very healthy setup as the price movements appear to be normal and organic, testing all previous levels of support and resistance before continuing.
As you can see from the chart, this structure was set at $ 10,000, after which the bitcoin price rose to the current price level of $ 13,800.
In this regard, a correction to the $ 11,500 area would be relatively healthy for the markets that may see a different reversal of support / resistance.
BTC / USD weekly chart. Source: TradingView
These support / resistance turns are very common as they also occurred at the start of the previous cycle in 2016.
During this year, a large number of structures are observed inside the polygon. This occurs until the price of a specific asset is included in the pricing, which leads to potential parabolic movements.
The 2016 elections also showed slight volatility in BTC.
4-hour chart for BTC / USD, 2016. Source: TradingView
Interestingly, the current growth in Bitcoin is similar to the growth in 2016. In the weeks leading up to the 2016 elections, the US dollar index declined significantly. This drop pushed the bitcoin price from $ 600 to $ 740, meaning an increase of over 20%.
But during the elections themselves, there was no instability. The volatility began after the election result was confirmed, as indicated by the red vertical line. Bitcoin price moved 6% in a few hours, while the US dollar showed weakness.
The main question will remain whether the election results will lead to volatility as the markets hold their breath.
As such, major moves for Bitcoin and the markets in general may come after the election result is confirmed, as it did four years ago.
The current campaign layout shows a lot in common with the campaign movements in 2016. A similar drop in the dollar index has pushed up real estate prices.
This means an increase in the Bitcoin price from $ 10,600 to $ 13,800, an increase of 30% within a few weeks. The big difference currently lies in the stability of the US dollar, while Bitcoin is still strong and growing.
Nevertheless, the 4 hour chart is showing potential bearish divergences in the charts. Bitcoin’s price often approached the $ 14,000 barrier simply by pushing liquidity higher.
These breakthroughs do not show full force as they continue to be rejected. In this respect, the deciding factor would be the range between $ 13,850 and $ 13,975 for any price continuation. If it crashes, a potential $ 15,000 target appears on the table.
However, if not broken, a test of the $ 13,000 to $ 13,200 range seems inevitable. As we discussed earlier, an additional correction will not be harmful to the markets, as it can ensure a very healthy build up in the bullish cycle itself.
A scenario with a higher time frame for Bitcoin price
5-day BTC / USD chart. Source: TradingView
The 5-day chart shows the likely scenario in the case of an overview of the lower timeframe. Thus, if the $ 13,900 area continues to resist resistance, a correction to $ 11,500-$ 11,800 will not be a surprise.
Such a correction will give another support / resistance reversal and more pressure before the next impulsive wave begins.
When the bitcoin price builds up and contracts, a snapshot to new full-time highs could happen faster than expected.