Cryptocurrency analytics firm QCP Capital has released its latest market assessment, highlighting the significant impact of the upcoming US elections on financial markets.
With just two weeks until the election, the firm noted that former President Donald Trump has gained momentum over Vice President Kamala Harris in prediction markets, with key states now leaning Republican. That shift is prompting markets to price in the possibility of a Trump presidency.
QCP Capital noted that the discussions around increased tariffs and potential tax cuts under the Trump administration have fueled a rally in the US dollar and US bond yields have risen. The benchmark 2-year US Treasury yield has once again breached the 4% mark. In this context, Bitcoin (BTC) has gained upward momentum, benefiting from Trump’s relatively crypto-friendly stance.
“Given Trump’s more crypto-friendly stance, it’s no surprise that BTC is also trading higher,” QCP Capital said. The firm noted that Bitcoin’s recent push toward $69,000 was supported by a record $40.5 billion in open interest on exchanges with futures contracts.
In broader markets, the S&P 500 continues to edge toward all-time highs on optimism surrounding economic growth. QCP Capital said the market expects a 1.5-centimeter rate cut in 2024, reflecting continued growth hopes amid a stronger-than-expected U.S. labor market.
All eyes are on next Friday’s Nonfarm Payrolls (NFP) report, which QCP Capital describes as a key event in shaping market expectations. As the final NFP report before the next Fed meeting, it is expected to play a critical role in determining the Fed’s stance on interest rates.
QCP Capital noted that the cryptocurrency market is closely monitoring these important events, adding, “BTC and ETH remain well supported by the employment data release and potential upside ahead of the elections.”
*This is not investment advice.
