Bitcoin Faces Test from U.S. Midterm Elections: Congressional Landscape Shapes Year-End Expectations, Democratic Sweep Could Be Most Detrimental to Crypto Industry

November 3 - According to a Bloomberg Market Pulse survey, if Republicans retain control of both chambers of Congress, the median year-end Bitcoin price forecast by respondents is $90,800; if Democrats win both chambers, the median forecast is $76,450. If the two parties split control of the Senate and House, the median year-end Bitcoin price forecast is $84,100. On the policy front, TD Cowen analyst Jaret Seiberg believes that Democratic control of both chambers is the most unfavorable scenario for Bitcoin and the crypto industry, potentially making it difficult for the CLARITY Act to pass in the next two years; Republicans holding both chambers would be most conducive to advancing crypto policy, but if the Senate majority advantage is limited, the bill could still face deadlock. Prediction market data shows a 77% probability of a "Democratic sweep of both chambers," which is the outcome the market considers most likely.

On short-term price action, QCP noted that with midterm elections and non-farm payrolls data concentrated in the same period, Bitcoin's support range is $76,000 to $76,600, with resistance at $79,500 to $80,500. If support is broken, the market will focus on the 50-week moving average at approximately $75,700 and the 200-day moving average at approximately $73,100. Renowned trader Doctor Profit posted that this week's US midterm elections and multiple corporate earnings reports could bring significant volatility. He still views $76,000 as the key level for maintaining the bull market structure, citing reasons including the price being near the previous breakout zone, an important weekly support level, and the 50-week moving average. He stated that at least 2 to 3 daily closes below this level would be needed to confirm a breakdown; if breached, there is risk of a decline to $67,000 to $69,000.

Risk Dimensions Chief Investment Officer Mark Connors believes that for year-end positioning, closely watching prediction markets and early exit polls is a waste of time. Even if Democrats control both chambers, crypto asset adoption still has the support of regulators and major financial companies. He maintains his 2027 Bitcoin target of $180,000. Analyst Benjamin Cowen believes that the Q4 sell-offs in midterm election years typically provide buying opportunities for investors who have already sold. In Q4 of 2014, 2018, and 2022, BTC fell 17.3%, 43.5%, and 14.8% respectively, all three occurring during bear markets. Longer-cycle data presents different results: CoinDesk statistics show that excluding 2010 when the market size was extremely small, BTC rose an average of 53.7% in the 12 months following the past three midterm elections. However, the sample size is limited, and the rebound may also stem from the halving cycle rather than the elections themselves.

In a report dated November 2, Bitwise's Head of European Research André Dragosch and researcher Luke Deans emphasized that no statistically significant impact of midterm election odds on the performance of major crypto assets has been found so far. Compared with elections, tightening financial conditions, inflation, and AI trading risks are more important; before the global growth expectation repricing is completed, Bitcoin's short-term downside risk may still be relatively high.