Bitcoin prices eased Tuesday but remained strong near critical support levels in the $ 30,000 to $ 31,000 range as traders awaited the outcome of the Georgia runoff.
The flagship cryptocurrency slid 0.75 percent ahead of the New York opening bell, fluctuating between two extreme levels, where it was $ 32,890 during the day and $ 29,891 during the day. Most recently it was trading for around $ 31,900, suggesting traders remain in a short-term bias conflict.
Bitcoin trades between gains and losses ahead of the Georgia elections. Source: BTCUSD on TradingView.com Bitcoin trades between gains and losses ahead of the Georgia elections. Source: BTCUSD on TradingView.com
So it seems that investors are closely watching the two Georgia election campaigns. If the Democrats win both seats, it will be easier for President-elect Joe Biden to provide additional fiscal stimulus without political opposition from Republicans.
More fiat liquidity is likely to depress the US dollar against strong and emerging currencies. In the meantime, this could also add to Bitcoin’s appeal as a safe haven asset, as the cryptocurrency has seen a 300 percent bull run in similar circumstances over the past 12 months.
More optimistic outlook could emerge if Mr. Biden raises corporate taxes and increases regulations. That would offer investors corrective stocks and limited hedging alternatives – thanks to already depreciating bond yields and the value of the US dollar. Bitcoin expects to benefit from this uncertainty as well.
A Republican victory, however, would lead to a stalemate on additional stimulus proposals. At best, this would slow Bitcoin’s uptrend growth, especially as it prepares to surge to $ 35,000 due to increased institutional interest.
Bitcoin 4H chart
The technical outlook on the Bitcoin four-hour chart (4H) favors bulls. While the cryptocurrency includes $ 30,000 as the primary level of support, it also trades within what appears to be a bull flag pattern. It serves as a bullish continuation indicator.
Bitcoin is consolidating lower in preparation for another leg up. Source: BTCUSD on TradingView.comBitcoin is consolidating lower in preparation for another leg up. Source: BTCUSD on TradingView.com
Based on the technical indicator, the BTC / USD exchange rate could break out of the range. The height of the eruption would be as great as the height of the flagpole that was formed in front of the consolidation canal. It’s around $ 5,000 long.
With that, BTC / USD is on the way to USD 35,000 to 36,000 in the short term.
Conversely, if extreme corrective sentiment invalidates the bull flag, the pair risks falling to its final support area of $ 26,500-27,500. The reluctant FOMC minutes released on Wednesday should nevertheless avoid this scenario.