Three weeks after the 2020 US presidential election, it has become certain that Democrat Joe Biden will step up to be the 46th president of the United States. For the crypto-industry, this raises the question of whether the stance of the world’s largest country by GDP towards Bitcoin will change for better or worse.
The US under Trump’s administration never publicly addressed any policy regarding digital currency. Despite there being news here and there signaling interests in the digital dollars initiative, a constructive conclusion was never reached.
A Biden administration, on the other hand, is generally more internationally-focused and tends to uphold good relations between the US and the world. With the rising trend of many countries competing in the CBDCs race, the de facto world leader may be more tempted to participate under Biden’s lead.
The shifting seats in both the House of Representatives and the Senate will play a major role in pushing new legislation to either aid or hurdle cryptocurrency, especially Bitcoin’s growth.
However, one certain thing is the price of stocks and cryptocurrency will no longer be affected and fluctuated by Trump’s “Twitter Effect” as Biden will bring normality back to mass public communication and diplomatic protocols.
The most important thing to keep an eye on from now on is the US Dollar Index, which will act as a compass for capital to flow into the risk-on or risk-off assets.
Bitcoin Technical Analysis
After the rejection from the multi-year high at $16,520, Bitcoin (BTC) is showing weakness as it lost $16K during the weekend. The overextended RSI on the daily timeframe now retrace back down while creating a lower low signalling small bearish divergence.
If a bigger correction should come, the first line of support would be the rising Speed Line in yellow which BTC has been riding above for the past few weeks. Breaking down from the line, however, could send Bitcoin back to the previous breakout point before at around $13,850 level.
Looking back when Bitcoin’s RSI reached the similarly high RSI back in late July, we can see that it was followed by a correction and then a consolidation period. We can assume that if the fractal is repeated, BTC will be moving in the sideways range between $13,850 to $16,250 until the next breakout comes.
Ethereum Technical Analysis
Ethereum (ETH) failed to break above the major resistance at $489 which is the current yearly-high thus making it fail to complete the Cup and Handle price pattern.
This rejection could lead to another pull-back where support should lie at $361 which is both a Fibonacci’s level and rising bottom channel in yellow.
Able to break above, however, will result in the completion of the Cup and Handle pattern which is extremely bullish and will send ETH to the first resistance at $532 and another at $800 level.
Disclaimer: This analysis is the view of the author’s alone, and does not in any way represent trading advice. all traders should trade at their own risk.
You may also want to read: Top DeFi Tokens YFI – AAVE – SNX Technical Analysis