Bitcoin hits $80.5K as US stocks rally on midterm election results

Bitcoin (BTC) returned to $80,000 at Wednesday’s Wall Street open as US stocks surged following a Democratic sweep in the midterm elections.

Key points:

• Bitcoin jumped past $80,500 at the start of Wednesday’s Wall Street trading session as risk assets gained following the US midterm election results.
• S&P 500 futures rebounded from a three-month low of 7,490 points as The Kobeissi Letter described the equities move as a “textbook bear trap.”
• Hopes for an end to the US-Iran war sent WTI crude oil below $93 per barrel.

Data from TradingView showed BTC/USD up by over 4%, having rebounded from its lowest levels in seven weeks.

BTC/USD four-hour chart. Source: Cointelegraph/TradingView

US stock futures made swift gains on Wednesday after initially dipping overnight. S&P 500 futures fell as low as 7,490 points, their lowest level since July 31, before reaching 7,690 points, approaching new month-to-date highs.

S&P 500 futures one-hour chart. Source: Cointelegraph/TradingView

In its latest analysis on X, trading resource The Kobeissi Letter called the initial equities weakness that accompanied news of the Democratic gains a “textbook bear trap.”

“This marks one of the largest shifts in US political power in nearly two decades,” it added, noting that the Democrats had flipped seven seats in the Senate and 25 in the House of Representatives.

In comments sent to Cointelegraph, James Butterfill, head of research at crypto asset manager CoinShares, saw the potential for a wider Bitcoin “relief rally” as election uncertainty faded.

“For Bitcoin, real yields, dollar liquidity and ETP flows still carry more weight than the elections,” he wrote, referring to Bitcoin exchange-traded products.

“We are seeing oil prices plummet, relieving some inflationary pressure and consequent rate hike expectations could moderate.”

Iran’s reaction to Democratic gains helped push US WTI crude oil prices to their lowest levels since mid-October.