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Bitcoin appears poised for a potential record high as it approaches the U.S. presidential election in November, supported by both on-chain and technical signals.
After dipping to a six-month low of around $49,500 during a global market downturn on August 5, Bitcoin may have hit a local bottom. This aligns with historical patterns observed in U.S. election years, where Bitcoin has frequently found its local low in the third quarter, typically around July or August.
Technical analyst SuperBro noted that in previous election years—2012, 2016, and 2020—Bitcoin’s local lows in the third quarter were often followed by significant upward momentum, leading to new record highs after U.S. presidential elections. This historical trend fuels anticipation that Bitcoin might resume its upward trajectory as the November 2024 election, featuring candidates Donald Trump and Kamala Harris, approaches.
SuperBro's analysis includes the "left-translated cycle" theory, which suggests that Bitcoin (BTC) cycles are starting earlier and reaching peaks sooner than in previous cycles. Evidence supporting this theory includes Bitcoin’s recent peak occurring a month before its fourth halving event in April 2024, a shift from past cycles where peaks typically followed halving events. If this pattern continues, Bitcoin could see substantial gains before the election, potentially reaching new highs earlier than expected.
Fundamental factors also support a bullish outlook. Trump’s favorable stance on Bitcoin and potential regulatory changes under different administrations could drive speculative buying, accelerating price increases. According to crypto betting service Polymarket, Trump’s chances of winning the election have recently improved, adding to the speculative interest.
On-chain data from Glassnode reveals that long-term Bitcoin holders have been realizing approximately $138 million in profit daily amid a flat price trend. This consistent profit-taking suggests substantial capital is entering the market, maintaining Bitcoin's price stability despite market fluctuations. The realized profit/loss ratio, while elevated, is beginning to decline from its peak, historically signaling a shift before an uptrend.
Technically, Bitcoin is forming a bull flag pattern, characterized by a strong uptrend followed by a correction within a descending parallel channel. This pattern could signal a breakout, potentially pushing Bitcoin towards $80,000 as the election draws near.
