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Bitcoin volatility rises as traders target $80K amid election

Bitcoin volatility rises as traders target $80K amid election

GrafaGrafa2024/10/29 17:00
By:Mahathir Bayena

As the U.S. presidential election approaches on November 5, Bitcoin (CRYPTO:BTC) traders are preparing for increased volatility, with some estimates predicting price swings as high as 20%. 

According to data from the DeFi derivatives platform Derive, a high concentration of bets is clustered around an $80,000 strike price, with traders showing a strong preference for short-term call sales.

Derive founder Nick Forster shared insights, stating, “The latest trading analysis reveals some compelling insights into market dynamics as we approach significant financial events.” 

He added, “The overwhelming dominance of calls being sold suggests a strategic premium collection by traders, while the focus around the $80,000 strike highlights a potential pivotal point for Bitcoin.”

Bitcoin recently surpassed $70,000, a level it last reached in early June, and continued to climb to $71,200, marking a daily increase of over 5%, according to CoinGecko data. 

Meanwhile, new Bitcoin exchange-traded funds (ETFs) have attracted nearly $1 billion in cash inflows over the past week, signaling growing investor interest ahead of the election. 

European asset manager CoinShares attributes this inflow to the heightened anticipation around the presidential race.

Volatility patterns across different expiration dates indicate that traders are gearing up for price fluctuations ahead of the election, although there is uncertainty regarding the exact direction of these movements. 

In the past 24 hours, over 47% of options sold were calls, reflecting a strategy to capitalize on increased premiums tied to election-related volatility.

Forster noted, “Short-term volatility, reflecting expected price movements, is now outpacing long-term volatility, with a noticeable spike expected around election week.” 

He explained that traders are positioning themselves for potential sharp swings in Bitcoin’s price as the election results unfold.

The closely contested race between Vice President Kamala Harris and former President Donald Trump has fueled speculation, particularly as Trump promises clearer policies targeting the cryptocurrency market. 

At the time of reporting, the Bitcoin price was $71,153.13.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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