Bitcoin's performance in the weeks following the US midterm election may hinge on three specific market conditions, according to analysis from XWIN Japan: continued exchange-traded fund buying, stabilization of Treasury yields, and progress on cryptocurrency regulation.
While historical data shows the S&P 500 has gained in all 19 12-month periods following US midterm elections since 1950, with an average appreciation of 15.4%, Bitcoin's track record is less consistent. The cryptocurrency rose 24.5% following the 2014 midterms, 44.9% after 2018, and 92.3% after 2022. However, Bitcoin fell 45.5% in the first month after the 2018 election, and analysts caution that only three observations exist for Bitcoin around midterms—insufficient to establish a reliable pattern.
Market Conditions Matter More Than History
XWIN Japan emphasized that while reduced political uncertainty could support risk-taking, the election itself does not guarantee higher cryptocurrency prices. The firm advised investors to monitor whether yields stabilize, ETF buying persists, and regulatory frameworks advance after the vote.
Iliya Kalchev, an analyst at Nexo Dispatch, credits recent Bitcoin gains partly to bond market developments, noting that US Treasury long-end bond buybacks expanded in August, coinciding with positive spot ETF inflows.
Near-Term Price Levels
Bitcoin was trading around $86,000 at the time of analysis, up approximately 3% over seven days and nearly 8% over one month, though down 31% from its value a year earlier and 32% below its $126,000 record high.
Lacie Zhang, a research analyst at Bitget Wallet, identifies $87,500 as a key resistance level for Bitcoin. A break above that level could trigger a short squeeze, while a drop below $82,000 to $82,500 support could open a move toward $80,000. Zhang also expects the Federal Reserve to raise rates by 25 basis points on October 28, a week before the midterm elections.
Historically, Bitcoin has ended the fourth quarter higher in nine of the past 15 years, though the median gain during that period is only about 9%.
