Bitcoin returned to the $80,000 mark at the opening of Wall Street on Wednesday, following the Democratic Party's progress in the U.S. mid-term elections, which drove a significant rise in U.S. stocks.
Bitcoin ( BTC ) briefly soared above $80,500 at the start of trading on Wall Street on Wednesday, while risk assets generally strengthened after the release of the results of the U.S. mid-term elections.
Key points:
- After the results of the U.S. mid-term elections were announced, risk assets rose, and Bitcoin briefly broke through $80,500 at the start of trading on Wall Street on Wednesday.
- S&P 500 index futures rebounded from a three-month low of 7,490 points, and The Kobeissi Letter described this wave of stock market movement as a “textbook bear market trap.”
- The market's expectation of a potential end to the war between the United States and Iran pushed WTI crude oil prices below $93 per barrel.
TradingView data shows that BTC / USD has risen by more than 4% and rebounded from its lowest level over the past seven weeks.
U.S. stock index futures briefly fell in the early trading on Wednesday before quickly rebounding. S&P 500 index futures once dropped to 7,490 points, hitting their lowest level since July 31, before rising back to 7,690 points, near the month's high.
The Kobeissi Letter indicates that this marks one of the greatest changes in political power in the United States in nearly two decades, noting that the Democratic Party has flipped 7 seats in the Senate and 25 seats in the House of Representatives.
The institution also stated: "For Bitcoin, the actual yield, US dollar liquidity, and ETP capital flows are still more important than elections." Here, ETP refers to the trading products of Bitcoin exchanges.
"We see a significant drop in oil prices, which has alleviated some inflationary pressures, and the subsequent expectations of interest rate hikes may also tend to be more modest."
Optimistic sentiment regarding the Iran war drives WTI crude oil to a three-week low
Iran's reaction to the Democratic Party's victory helped drive US WTI crude oil prices down to their lowest level since mid-October.
The Speaker of the Iranian Parliament, Mohammad Bagher Ghalibaf, stated on X that voters "have spoken against war, and we support this message."
WTI once fell below $93 per barrel, with the largest decline of 11.9% within the week; Brent crude oil approached below $100 per barrel for the first time since October 7th.
WTI Crude Oil CFD Daily Chart. Source: Cointelegraph / TradingView
Earlier on Wednesday, U.S. President Donald Trump admitted that the conflict with Iran contributed to the Republican Party's defeat in the elections to some extent.
Economist Robin Brooks stated that the risk premium factored into the oil market before the mid-term elections is “too high.”
In a blog post, he wrote: "The key question now is whether this will lead the president to back off on the issue of war with Iran, or whether it will further escalate."
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