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In a research paper dated October 24, Geoff Kendrick, global head of digital asset research at Standard Chartered Bank, predicts that bitcoin could rise to $125,000 by the end of the year if former President Donald Trump is victorious in the upcoming election. United States presidential elections.
When bitcoin could reach $125,000
Kendrick's x.com/BecauseBitcoin/status/1849567818913661373″ target=”_blank” rel=”nofollow”>analysis It depends on the interaction between bitcoin price movements and the US political landscape. “We use daily btc volume levels and popular exercise levels to estimate post-election price movements,” he states in the report titled bitcoin – Post-US Election Playbook. According to Kendrick, bitcoin prices have risen in recent weeks, aligning with other trades favored by Trump supporters.
The report forecasts that bitcoin is likely to reach approximately $73,000 by Election Day on November 5, approaching its all-time high of $73,800 recorded in March. “Our base case is that bitcoin rises to around $73,000 by Election Day, matching the betting market's odds of a Trump victory,” Kendrick notes.
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Betting markets reflect growing confidence in a Trump victory. “Average betting odds on a Trump victory are now 59%, according to RealClearPolitics. Furthermore, conditional probabilities on specific betting markets (Polymarket) suggest a 75% chance of a Republican victory if Trump wins the presidency,” the report highlights.
Should Trump win, Kendrick anticipates immediate bullish momentum for bitcoin. “Assuming a Trump victory, the equilibrium point of the options implies a new price increase of around 4% when the presidential result is known, and around 10% in total in a few more days,” he explains.
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The possibility of Republicans sweeping Congress amplifies this perspective. “If Republicans sweep Congress, our year-end target level of $125,000 should appear,” Kendrick says. This scenario is supported by significant open interest in bitcoin call options expiring on December 27 at the strike price of $80,000, suggesting a rapid move towards that level.
What happens if Harris wins?
Conversely, if Vice President Kamala Harris emerges victorious, the report suggests a temporary setback for bitcoin prices. “If Harris wins, we will see btc initially trade lower, but still end 2024 at new highs around $75,000,” Kendrick projects. This implies a resilient long-term outlook for bitcoin regardless of the election outcome, although the magnitude of the gains would differ.
Kendrick emphasizes the role of options market data in gauging potential price movements. “Options information helps estimate initial post-election price movements,” he says. Large trading volumes and popular strike levels serve as indicators of investor expectations and market positioning ahead of the election.
The recent drop in bitcoin price to a local low of $65,200 was also addressed. Kendrick believes it will “probably be the last one before the US presidential election,” suggesting any short-term correction may be overshadowed by looming political events.
At the time of publication, btc was trading at $67,520.
Featured image created with DALL.E, chart from TradingView.com
