On Its 16th Birthday, Bitcoin Is Enjoying All-Time Highs: The Uptober Of The Trump Trade
October proved once again a positive time for crypto markets despite much uncertainty and volatility.
Confirming the October narrative, Bitcoin is finishing the month at an arm's length of its all-time high of $73,800.
As the asset is increasingly considered the ultimate "Trump Trade," analysts expect the next Bitcoin chapter will be marked by high volatility.
"Driven by a potent mix of geopolitical uncertainty, macroeconomic factors, and the intensifying 'Trump trade' narrative, BTC volatility has intensified," notes a report from Bitfinex.
October Wrap-Up
The escalation of the geopolitical conflict in the Middle East and caution regarding macroeconomic factors led to a cold start to October for Bitcoin, which remained stuck below $65,000 during the first two weeks of the month.
The confidence in the Uptober narrative was restored following the news of a Chinese stimulus package, the announcement of MicroStrategy's plans for a Bitcoin bank, and the increasing speculation surrounding the U.S. elections.
After Bitcoin's price broke the resistance level on October 15, it has only gone up, and now that the month draws to a close, it is again approaching its all-time high.
On Tuesday, October 30, U.S. listed spot Bitcoin ETFs registered over $870 million in inflows - the highest volume in six months - with Blackrock's IBIT leading at $629 million.
Usually, ETF volume is higher when the price of the underlying asset is down, but, according to Bloomberg analyst Erich Balchunas, the "volume can spike if there is a FOMO-ing frenzy."
Retail interest is keeping up with institutional and Bitcoin's dominance over the crypto market broke the 60% level on Tuesday, as per data from Trading View.
The Trump Trade
"The general consensus across risk assets is that a Republican victory would be bullish for the markets, while it is less certain that a Democrat win is immediately positive for markets," a Bitfinex report reads.
Adding to the longstanding views of how U.S. politics affects financial markets, the former U.S. president's promises of policy change regarding cryptocurrencies have further contributed to the perception that, more than any other risky asset, Bitcoin will be impacted by the U.S. elections on November 5.
The "Trump Trade" narrative has gained a lot of ground in the last couple of weeks, which has been chiefly reflected in an increase in options contracts that terminate around November 6 to November 8—the days after Election Day.
An anonymous investor, The Giver, explained in a post on X, "The direction of the election does not drive a price-dependent outcome; rather, Bitcoin is currently being used as a liquid proxy to hedge a Trump win."
The price of the number one cryptocurrency is now more responsive to geopolitical events and macroeconomic factors than in any bull market before, and with all the speculation surrounding the U.S. election, this period is set to be one of the most unexpected in Bitcoin's history.
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