How to prepare your crypto trading for the new US midterm elections?

In 2014 and 2018, the US midterm elections were followed by steep falls in the crypto market. Will the same situation happen this year as well? It is not certain.

In 2014 as in 2018, crypto prices crashed right after the US midterm elections. However, several signs suggest that this time will be different.

These signals are mainly related to the total capitalization of the crypto market. Additionally, prices could turn bullish if Republicans were to win a majority in the House and/or Senate. In fact, these are generally considered crypto-friendly. The same can be said about Donald Trump’s possible presidential candidacy in 2024.

Either way, the crypto market has fallen over the past 24 hours. Knowing that today is election day, it is interesting to examine the price movements and determine the reasons for this phenomenon.

Bitcoin price is holding above its support

Bitcoin (BTC) has held above the $19,000 horizontal support zone since June 2022, which it has validated on numerous occasions. Throughout this period, the weekly RSI generated a bullish divergence (green line). Despite the current price drop, the weekly RSI trend remains intact.

Thus, the trend can still be considered bullish as the BTC price is trading above the major support zone and the RSI divergence is intact. A drop in the RSI and a weekly close below the $19,000 area would be necessary for the trend to turn bearish.

BTC/USDT – TradingView

The key areas for a decline or an increase in price

Technical analysis of the daily chart shows that the Bitcoin price is moving inside an ascending parallel channel. After failing to break above this channel on November 5, it returned to its support line.

Additionally, the daily RSI is just holding its bullish divergence trendline that has been in place since September 5th. A passage below these levels could accelerate the downward movement.

Thus, the direction of the future trend will likely be determined by whether the BTC price falls below its channel, dragging the RSI with it, or whether, on the contrary, it reverses and regains the $21,470 area (green line).

BTC/USDT – TradingView

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