Bitcoin (BTC) held above its 100-day moving average on Monday ahead of US midterm elections, jobs data and earnings from Apple and Palantir.
Key points:
- Kalshi traders put Democrats’ chances of winning control of the House at 93.6% ahead of Tuesday’s US midterm elections.
- US nonfarm payrolls are forecast to rise by 65,000 in October as markets favor a December Fed rate hike.
- Bitcoin holds its 100-day moving average as trader Rekt Capital compares its price chart with the 2023 recovery.
Midterms follow Bitcoin’s weakest October since 2014
Tuesday’s US midterm elections will determine control of Congress, with prediction market traders heavily favoring a Democratic victory in the House of Representatives.
Kalshi put the probability of Democrats winning the House at 93.6% as of Monday.
President Donald Trump said he would use his veto power if Democrats took control of Congress.
“I guess I’ll become Mr Veto. They’ll be sending stuff up. You veto it,” he said, according to the New York Post.
US midterm elections odds (screenshot). Source: Kalshi
Bitcoin ended the fourth quarter lower in each of the past three US midterm election years, falling 17.3% in 2014, 43.5% in 2018 and 14.8% in 2022. All three periods coincided with Bitcoin bear markets.
Benjamin Cowen, founder and CEO of crypto analytics platform IntoTheCryptoverse, suggested that the midterms can function as a cue to increase BTC exposure due to their short-term bearish impact on price.
“Usually the Q4 dump of midterm years just provide opportunities to buy for those who sold long ago,” he said Friday on X.
In July, Cowen referenced Bitcoin bear-market bottoms coinciding with the second half of midterm years.
BTC/USD was down 6.4% for the quarter as of Monday, after its weakest October since 2014, according to CoinGlass.
BTC/USD liquidation heatmap. Source: CoinGlass
Jobs data and tech earnings test market expectations
September US job openings data are due Tuesday, followed by October’s nonfarm payrolls report on Friday.
Payrolls are expected to rise by 65,000, after the economy added 29,000 jobs in September, below forecasts for 84,000. Such an outcome notionally increases the odds of dovish policy signals from the Federal Reserve, which is in turn bullish for crypto and risk-asset liquidity.
Cleveland Fed President Beth Hammack and Fed Governor Michelle Bowman are among the officials due to speak this week.
Data from CME Group’s FedWatch Tool currently shows that markets expect the Fed to raise interest rates by 0.25 percentage points at the December meeting of the Federal Open Market Committee (FOMC). The odds of such an outcome have sat between 67% and 75% for the past month.
Fed target rate probability comparison for December FOMC meeting (screenshot). Source: CME Group
The University of Michigan will also release its preliminary November consumer sentiment survey on Friday, including consumers’ inflation expectations.
Alongside the macro data prints, 20% of S&P 500 companies are due to report earnings in the coming days. Chief among these are tech giants Apple and Palantir, both due to report after the market close on Monday.
The reports follow last week’s tech sell-off, when disappointing guidance renewed concerns about AI spending and profitability.
Economist Mohamed El-Erian described markets as now “acutely sensitive” to tech-sector news headlines in weekend analysis.
“The market is particularly focused on justification for the massive capital expenditures being deployed across the sector, ROI’s, and revenue growth,” he wrote.
Bitcoin chart draws comparisons with 2023 recovery
After closing October down 7.3%, Bitcoin is holding above a moving average that has provided support since mid-August.
Related: Here’s what happened in crypto today
TradingView data showed BTC/USD staying above last week’s low near $76,300, without retesting it around the monthly close.
That low was close to the 100-day simple moving average (SMA) for BTC/USD, which has since risen to $76,548.
Bitcoin also reclaimed its 100-week exponential moving average (EMA) in time for the monthly close, with this standing at $77,759.
BTC/USD daily chart with 100 SMA, 100 EMA. Source: Cointelegraph/TradingView
Trader and analyst Rekt Capital compared the weekly chart with Bitcoin’s rebound from its 2022 bear market low. During the recovery, BTC/USD produced an inverse head-and-shoulders pattern, retested support at the right shoulder, briefly fell below it and then rallied.
Last week’s drop to $76,300 brought Bitcoin back to what Rekt Capital identified as right-shoulder support on the current chart. He is watching for a brief move below that level as a possible next step in the comparison.
“The question now is whether Bitcoin can produce some sort of downside deviation below here over the next few weeks,” Rekt Capital said.
BTC/USD one-week chart. Source: Rekt Capital on X.com
