As the U.S. election nears, some crypto experts suggest a Trump victory could give the market a “dopamine hit,” driving up prices temporarily. However, analysts urge caution as the crypto market’s inherent volatility means unexpected swings are likely.

Why a Trump Win Might Fuel a Crypto Rally

Industry experts, like Swyftx lead analyst Pav Hundal, believe that a Trump win on November 5 may spark a crypto market rally. This outcome could encourage some investors, hopeful for Trump’s previous pro-business stance, to drive up prices. However, Hundal warns that this enthusiasm could lead to more volatility in the days surrounding the election.

Nick Forster, founder of Derive, points out that traders are already preparing for potential market swings. According to Derive options data, many are buying calls, anticipating a bullish scenario, which could lead to a “buy the rumor, sell the news” pattern post-election. However, Forster cautions that price reactions can be unpredictable, and any positive momentum could quickly turn if expectations aren’t met.

Bitcoin Nearing All-Time Highs, but Election Isn’t the Only Factor

Bitcoin has seen a 7.62% climb since October 23, nearing an all-time high. However, Hundal and 10T Holdings founder Dan Tapiero argue that while the election may impact prices, it isn’t a decisive factor in Bitcoin’s trajectory toward a potential six-figure value. Hundal sees other market fundamentals driving Bitcoin’s value growth through the end of 2024 and into 2025.

Given the volatility of crypto markets, Forster suggests a “diversified strategy” for traders looking to navigate the election outcome. By including options and hedging tactics, traders may better manage risks instead of relying solely on outright buys. Hundal echoes this, advising most traders not to worry about timing trades unless they are highly experienced or actively seeking short-term gains.

Despite potential short-term election effects, both Hundal and David Lawant of FalconX remain optimistic about the long-term growth of Bitcoin. They argue that Bitcoin and crypto markets are likely to perform well regardless of who wins the White House.