Bitcoin Faces Increased Volatility Amid US Elections and Near $90K Mark
Bitcoin is expected to face increased volatility amid the upcoming US elections and as its price approaches $90,000. Trading firm QCP Capital anticipates a ’sell-the-news’ effect post-election, similar to past events, suggesting a potential price drop. Market makers, currently short gamma near this price level, may inject volatility through hedging, selling during price drops and buying during rises to keep a neutral market position. This activity could lead to fluctuations before the settlement of quarterly options this Friday, which might influence price movements. Despite the expected volatility, some traders show optimism, taking long positions on Bitcoin. Analysis suggests a potential upward movement post-settlement, parallel to PAXG’s behavior, which finds support after declines and encounters resistance after significant rises.
Neutral
The cryptocurrency market appears poised for volatility due to significant events like the US elections and the nearing $90,000 price level for Bitcoin. While QCP Capital anticipates a bearish ’sell-the-news’ effect post-election, the presence of bullish sentiments, shown by increased long positions, indicates potential optimism. The influence of market makers hedging against short gamma could lead to sharp price swings, although the upcoming settlement of quarterly options might stabilize the situation temporarily. Given these mixed signals, the overall market view remains neutral, cognizant of the potential for both upward and downward movements.