Bitcoin price defends $76K lows as analysts see stocks pricing in ‘political gridlock’
Bitcoin made modest gains at the start of Wall Street trading on Tuesday as markets awaited cues from the US midterm elections.
Bitcoin (BTC) headed higher at Tuesday’s Wall Street open as a tech-stock rebound under the shadow of uncertainty surrounding the US midterm elections.
Key points:
- Bitcoin price action edged 0.7% higher on Tuesday as US equities avoided succumbing to midterm election uncertainty.
- Analysis from The Kobeissi Letter suggested markets were pricing in two years of political uncertainty amid expectations of Democratic gains in the midterm elections.
- WTI crude oil dipped to $93.59 per barrel, its lowest level since Oct. 15, despite fresh US strikes targeting Iran’s Qeshm Island.
Data from TradingView showed BTC/USD circling $77,000, continuing to retain local lows near $76,300 seen on Friday.
BTC/USD one-hour chart. Source: Cointelegraph/TradingView
Stocks faced conflicting forces at the start of the US trading session. Apple shares sought to pare losses after falling 4% in premarket trading as the company forecast gross margins of 45% to 46% for the December quarter, down from 47.9% in the previous quarter, citing rising memory-chip costs.
Markets also weighed the potential impact of the US midterm elections on the balance of power in Congress. Although polls suggested significant Democratic gains, some analysts cautioned that the results could be less decisive than expected.
Apple stock one-day chart. Source: Cointelegraph/TradingView
“Investors seem to have a significant dose of skepticism about whether the final outcome is going to be quite as favorable to Democrats as the polling suggests,” Tobin Marcus, head of US policy and politics at equity research company Wolfe Research, told CNBC. Wolfe added that polls were “likely overstating Democratic strength.”
The S&P 500 and tech-heavy Nasdaq Composite Index finished Monday down 0.5% and 1.1%, respectively. Analysts at trading resource The Kobeissi Letter argued that US political uncertainty, rather than concerns over AI spending alone, was driving market weakness.
“The reality is that the market is pricing-in a major shift in the political landscape of the US,” it wrote on X.
The analysis suggested that a divided Congress could lead to frequent legislative impasses, creating conditions in which policy decisions would become less predictable.
“A change in the political landscape always comes with uncertainty; markets hate uncertainty,” it continued.
“Objectively, the market is in the process of pricing-in two years of political gridlock.”
Nasdaq Composite Index one-day chart. Source: Cointelegraph/TradingView