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NewsBTC 2024-11-06 18:32:04

Record-Breaking Bitcoin Surge Post-Trump Election: Futures Market Hints At More To Come

The futures market is signaling that the current Bitcoin rally, spurred by Donald Trump’s recent election victory on Tuesday, might be starting. According to Vetle Lunde, head of research at K33 Research, the election’s immediate aftermath has seen a “risk-on rotation” across derivatives, indicating a surge in investor confidence. Bitcoin Options Market Targets $80,000 By Late November On the Chicago Mercantile Exchange (CME), the basis—the difference between the spot market price and futures contract prices—has risen sharply from 7% to over 15% in a single day, reflecting heightened interest from institutional investors. Additionally, perpetual futures contracts, favored by offshore investors, are now trading at their largest premiums to the spot market since March, further underscoring rising demand for leverage. Related Reading: Ethereum Volatility Soon? Derivatives Exchanges Receive 82,000 ETH In Deposits Bitcoin recently surpassed $75,000 for the first time, buoyed by expectations that a second Trump presidency will usher in more favorable policies and regulations for the cryptocurrency sector, as he has vowed to support the growth of the market, with BTC at the heart of what could be a new economic policy for the nation. Before the election, NewsBTC reported that the Bitcoin options market had already set its sights on an ambitious target of $80,000 for expiries slated for late November, showcasing the optimism surrounding the asset’s potential. Analysts Predict Strong ETF Inflows Post-Election Michael Safai, founding partner at quantitative trading firm Dexterity Capital, told Bloomberg that Trump’s administration promises decreased regulatory intervention in the US, a development many crypto investors have advocated during previous years of heightened scrutiny. While exchange-traded funds (ETFs) backed by Bitcoin experienced one of the largest outflows on Monday, Safai suggests that traders remain optimistic about a potential reversal. Lunde also indicated that the European trading session had been relatively quiet. Still, Bitcoin appears to be finding support at its former all-time highs, a positive sign for continued upward momentum. Anticipating strong ETF inflows during US trading hours on Wednesday, the analyst expects the combination of rising CME premiums and post-election clarity to bolster Bitcoin’s performance. “The backdrop of burgeoning CME premiums presents carry opportunities that should support strong performance,” Lunde explained. However, amidst the positive outlook, some traders advise caution regarding potential price corrections. Related Reading: Uniswap Surges Toward $8.74 – Can UNI Push Through To New Heights? Previous bullish runs, such as the one witnessed in March following the introduction of Bitcoin exchange-traded funds, led to significant liquidations across both directions of the market, with the cryptocurrency recording drops of over 20% following the record peak. Nathanaël Cohen, co-founder at INDIGO Fund, cautioned that profit-taking could trigger corrections at current levels. However, he remains optimistic about the overall trend moving higher in the coming months. At the time of writing, BTC was trading at $74,430, up 6.2% on a 24-hour basis and nearly 4% every week. Featured image from DALL-E, chart from TradingView.com

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