Bitcoin investors are increasingly concerned about the US election.
Historical data show that BTC could be unaffected by the results.
Even though the technical data predict a possible correction, prices are on a rigid support.
Bitcoin is experiencing high volatility during the US presidential election. While it remains to be seen whether the Democratic or Republican party will win, historical data shows that the flagship of the crypto currency could resume its upward trend after the Americans have finished voting.
Bitcoin is resilient ahead of the US elections
While most crypto currencies on the market suffered substantial losses in the last days, Bitcoin continues its upward trend. The lead currency Kryptowährung could reach a new yearly high on 31 October with 14.140 $. Although the prices came recently under pressure due to fears in connection with the US elections, BTC recovered partially.
It remains uncertain how a Democratic or Republican Party victory will affect the crypto-currency market. However, historical data shows that Bitcoin was able to weather the storm during the last two U.S. presidential elections.
For example, the pioneer crypto currency fell by more than 20% about two weeks before the 2012 election. After it was confirmed that Barack Obama was re-elected for his second term as U.S. President, confidence returned to the market and Bitcoin marched towards higher highs.
A similar price action took place after Donald Trump was elected the 45th President of the United States in 2016. The BTC had nosedived 12% five days before the ballots were counted and resumed its historic uptrend immediately thereafter.
Now that investors seem uncertain about Bitcoin’s future in light of the election results, history could repeat itself.
Technical analysis: Short-lived correction before higher highs
The Tom Demark (TD) Sequential indicator is about to give a sell signal on the BTC daily chart. The bearish formation is likely to take the form of a green nine-candlestick. Such a technical pattern indicates that a peak in selling pressure could trace the prices of one to four candlesticks on the daily chart before the upward trend resumes.
In the event of a correction, IntoTheBlock’s “In/Out of the Money Around Price” model (IOMAP) shows two important support areas below Bitcoin.
Based on this on-chain metric, more than 1.1 million addresses had previously purchased more than 600,000 BTC between $13,300 and $13,700. This demand freeze could absorb some of the downward pressure and keep falling prices in check. However, if the number of sell orders is significant enough to push Bitcoin below this limit, the next critical area of interest will be between $11,600 and $12,000, the next signal for buyers of Bitcoin.
Here about 820,000 addresses bought nearly 540,000 BTC.
On the other hand, the IOMAP cohorts show that there are no significant barriers to resistance before Bitcoin. The only significant barrier is between $13,740 and $14,140, with 560,000 addresses containing about 200,000 BTC.
Important price levels to observe
The current U.S. presidential election could prove to be a non-event for Bitcoin if history repeats itself. Regardless, investors must pay close attention to the $13,300 support and $14,140 resistance level. A candle close above or below this price range will determine where the crypto-currency’s flagship will go next.
The BTC could rise to $16,000 or higher if it cuts through the overhead resistance, while moving past the support will trigger a rebound towards $12,000.