Crypto markets are preparing to enter one of the most turbulent weeks of 2024. Developments in the US are particularly noteworthy. Three major economic events, namely the US elections, unemployment claims and the Federal Open Market Committee (FOMC) meeting, could affect investors. In addition, critical data will also come from countries such as the UK, China and South Korea. The most striking development in this busy calendar is the presidential race between Donald Trump and Kamala Harris.
The crypto market is in turmoil with the US elections
In the US presidential elections to be held on Tuesday, November 5, Republican Party candidate Donald Trump and Democratic Party candidate Kamala Harris are in a fierce race. According to Polymarket’s data, Trump appears to be ahead of Harris by a small margin. However, other prediction platforms such as Kalshi also show Trump ahead by 52%. This small difference signals that markets will react differently depending on the election results.
The election results may have a direct impact on the US economy and cryptocurrency policies. The winning party’s approach to regulations could cause fluctuations in cryptocurrency markets, especially Bitcoin (BTC). AlphaBTC analyst Mark Cullen said, “Tuesday will be a very busy day. If there is no clear result, we could enter a tense period for Bitcoin,” drawing attention to the effect of uncertainty on prices.
FOMC and other data are also on the agenda
Immediately after the elections in the US, all eyes will be on the unemployment application data to be announced on Thursday, November 7. Economists expect applications to rise to 220,000. While this data provides clues about the current state of the US labor market, high unemployment applications may indicate increasing economic difficulties. If unemployment applications increase, investors may move away from traditional assets such as stocks and turn to alternative investments such as cryptocurrencies.
The FOMC regulates interest rates in the US economy in order to keep inflation under control and provide full employment. At the FOMC meeting on the evening of November 7, expectations are for an interest rate cut of 0.25%. This rate becomes more possible as the consumer price index (CPI) approaches the 2% target. In addition, the increase in the unemployment rate from 3.7% to 4.1% since the beginning of the year signals a slowdown in the labor market, which increases the likelihood of a rate cut.
According to CME’s Fed Watch Tool data, markets predict a 99.9% probability of a rate cut. This decision by the FOMC in November and the statements to be made by Fed Chair Jerome Powell may support the expected volatility in cryptocurrency markets in particular. A possible rate cut to support economic growth may lead to a potential increase in Bitcoin’s value by encouraging investors to turn to cryptocurrencies.
What are the expectations for crypto projects?
Bitcoin is trading at $68,000 ahead of important events such as the US elections and the FOMC meeting. According to Spotonchain analysis, Bitcoin has a high potential to reach $100,000 by the end of 2024 after this week. Historical data shows that a bull market usually occurs after the US elections. Spotonchain says, “We think BTC will continue to rise regardless of who wins the election,” and draws attention to the fact that the volatility that may occur this week may be the beginning of a long-term rally. It is predicted that Bitcoin and other cryptocurrencies may enter a broader upward trend, especially if it is supported by a possible interest rate cut by the FOMC.
There are developments in other countries as well
Not only developments in the US, but also important events that may affect Bitcoin and altcoin markets internationally will take place. The cryptocurrency committee, which will meet for the first time in South Korea on November 7, will draw a roadmap for cryptocurrency regulations and crypto asset strategies in the country. The interest rate decision of the UK Central Bank is expected on the same day. On November 8, a $1.4 trillion monetary package will be on the agenda in China.
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