Crypto market retreats, Donald Trump claims victory

  • Bitcoin price has the potential to rally whether Donald Trump or Joe Biden wins the US election.
  • Ethereum assumes some stability to give buyers ample time to plan another recovery mission.
  • Selling pressure is rising as Ripple declines target $0.23 crucial support area.

The cryptocurrency market is mainly in the red when the United States is conducting its 2020 presidential elections. Donald Trump claimed victory but the votes are still being counted in several swing states and the final results could be pending for hours, if not days or weeks.

Volatility heightened from the beginning of the week, with Bitcoin climbing to new yearly highs. Retracements have also become frequent, but crypto assets across the board are struggling to regain stability. At the moment, all the energy is focused on finding strength before the uptrend resumes.

How will the US presidential elections affect Bitcoin?

In the run-up to the elections in which Donald Trump is going head to head with Joe Biden, Bitcoin rallied by a colossal 30%. The impressive price action has been attributed to a series of positive news that has hinted at an exponential rise to new all-time highs.

On the other hand, the stock market remained unstable towards the election. Dow Jones Industrial Average closed its worst and month since the pandemic-triggered crash in March. According to the Executive Director at Exante, a brokerage firm, Anatoliy Knyazev, Bitcoin might benefit in any case, either Trump or Biden win the election, for different reasons:

A Trump win will probably be welcomed by the stock market players and bitcoin will continue growing along with other assets.

However, a Biden win, which may lead to a stock market fall, could also work in bitcoin’s favor based on the expectation of the depreciation of the dollar.

Bitcoin seeks support before another breakout

Bitcoin resumed the uptrend on Tuesday after finding support at $13,200. An ascending parallel channel’s lower boundary assisted in mitigating the losses discussed earlier. Recovery above the 50 Simple Moving Average (SMA) boosted the flagship cryptocurrency slightly past $14,000.

Intense seller congestion at the yearly high rejected the price, culminating in an ongoing correction. For now, BTC is seeking stability at $13,800 amid an increase in selling pressure. Support is anticipated at the 50 SMA from where bulls can strategize on another angle of attack to sustain gains above $14,000.

BTC/USD 4-hour chart

The Relative Strength Index (RSI) shows that the bellwether cryptocurrency might overshoot the 50 SMA and the ascending trendline support, hence destabilizing the market. In this case, a bearish outlook will come into the picture. Declines are likely to retest the 100 SMA, marginally above $13,000. A massive selloff could also grip the market because investors will rush to take profits, which will intensify the selling pressure below $13,000.

Ethereum downtrend temporarily hits pause

Ether recovered from support established at $370 on Tuesday. Nonetheless, the bullish momentum was not strong enough to overcome the 50 SMA hurdle in the 4-hour timeframe. A correction occurred, sending the smart contract token towards $380.

According to the Moving Average Convergence Divergence (MACD), Ethereum could steady above $380 in the near term. This will give bulls ample time to organize another attack on the hurdles at $390 and $400, respectively.

ETH/USD price chart

ETH/USD 4-hour chart

The expected stability will be jeopardized if the breakdown progresses under $380. Selling orders are likely to increase, risking declines below the critical support at $370 and the descending parallel channel. More formidable support would be the range between $360 and $365.

Ripple retracement eyes $0.23

The cross-border cryptocurrency has been trading below a descending trendline from October’s recovery stalled at $0.26. RSI’s gradual movement has emphasized the magnitude of the downward momentum beneath the midline. Selling pressure below the moving averages adds credence to the bearish outlook. Besides, the ongoing breakdown is likely to revisit the critical support at $0.23 before a significant recovery comes into play.

XRP/USD price chart

XRP/USD 4-hour chart

Declines to $0.23 will be invalidated in the event XRP resumed the uptrend and climbed above $0.24. A spike past the 50 SMA and the descending trendline might call the buyers who have retreated to the sidelines. The journey to $0.26 will depend on the bulls’ ability to gain ground beyond the 100 SMA and the 200 SMA.