Bitcoin U-Turns on Trump Victory

The crypto-market had a interesting week, like most financial markets. The US election last Tuesday sparked a wave of volatility that was also felt in Bitcoin and Litecoin. But the initial impact was soon negated as prices took a U-turn and erased the gains.

Bitcoin U-Turns on Trump Victory

The US election brought a surprising winner last Tuesday. Despite what the polls were suggesting, Donald Trump will be the new US president. This surprise result initially led to a shock risk-off mode in markets. We saw the Yen rallying, the SP500 crashing by 5% and Gold and Bitcoin moving higher. Prices hit a high of $729 dollars on November 9th right after the election results.

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However that move quickly reversed course and few days later BTC prices were trading back to where they started. This is the scenario we outlined in our previous article, a short-term positive effect that would be quickly faded. The move lower didn’t stop here. As we can see on the chart above, during the dump last week a low of $685.07 was hit.

This week we’re seeing a slight recovery with prices trading at $697 dollars at the moment. Because the important $670 support level wasn’t broken the trend higher remains in place. We’re now looking bit higher at the $680 level as a potential trend stopper. A new downtrend requires a break below the former swing high at $657 dollars.

On the upper end, the double top near $730 dollars will be crucial. A breakout above here could intensify the gains. For bitcoin all three trends (short-term, medium-term and long-term) are still bullish.

Litecoin Breakdown Rejected

Litecoin followed a similar pattern after Trump’s victory. Prices on Fxopen rose by 15 cents to $3.88, a high that was quickly faded here as well. But unlike bitcoin, the LTC selling was so strong that prices briefly entered a bear market. A low of $3.64 was hit on November 13th. From here however a surge of buying commenced and Litecoin rallied 25 cents or almost 7 percent in the span of 2 hours.

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The speed and the strength of this rally suggests that the move lower was a false break. We’re now back into uncharted territory for LTC/USD. A new uptrend requires a breakout above the $4.08 swing high while a new downtrend should break the November lows at $3.64 dollars. More support below here can be found at the $3.50 round figure followed by the $3.22 swing low.

Petar Kotevski

Petar is a forex trader and writer with 9 years of experience in financial markets. He has been following bitcoin since 2010. A year ago, as the BTC market matured, he started getting more involved by writing articles on bitcoin and other alternative currencies.

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