Bitcoin prices fell lower on Tuesday but held a strong position near critical support levels in the $ 30,000-31,000 range as traders awaited the outcome of Georgia’s second election.
The flagship cryptocurrency slid 0.75 percent ahead of the opening bubble in New York, wobbling between two extreme levels where $ 32,890 was intraday high and $ 29,891 intraday low. Most recently, it traded at around $ 31,900, suggesting traders are in short-term conflict.
Bitcoin is trading between gains and losses ahead of the Georgia elections. Source: BTCUSD on TradingView.com
So it seems investors are watching closely the two electoral races in Georgia. If the Democrats win both seats, it will be easier for President-elect Joe Biden to implement additional fiscal stimulus without political opposition from the Republicans.
More fiat liquidity expected push the US dollar lower against strong and emerging currencies. Meanwhile, it could also increase Bitcoin’s appeal as a safe haven, given the cryptocurrency’s 300 percent bull run over the past 12 months – under similar circumstances.
More optimistic outlook could surface if Mr. Biden raises corporate taxes and increases regulation. That would leave investors with corrective stocks and limited hedging alternatives – thanks to already declining bond yields and US dollar values. Bitcoin also expects to take advantage of such uncertainty.
A Republican victory, however, would create a deadlock additional incentive proposals. That would, at best, slow Bitcoin’s upward growth, especially as it prepares for a run-up to $ 35,000 on increasing institutional interest.
Bitcoin 4H chart
The technical outlook on the Bitcoin four-hour (4H) chart is in favor of bulls. While the cryptocurrency has $ 30,000 as its primary support level, it is also trading in what appears to be a Bull Flag pattern. It serves as a bullish continuation indicator.
Bitcoin consolidates lower to prepare for another leg upward. Source: BTCUSD on TradingView.com
Based on the technical indicator, the BTC / USD exchange rate could break out upwards. The height of the escape would be as much as the height of the flagpole formed before the consolidation channel. It’s about $ 5,000 long.
That puts BTC / USD on the way to $ 35,000-36,000 in the near term.
Conversely, if an extremely corrective sentiment invalidates the Bull Flag, the pair risks falling to its latest support range of $ 26,500-27,500. The mild FOMC minutes coming out on Wednesday should avoid that scenario.