QCP Capital analysts forecast surge in near-term crypto market volatility

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The Block2024/09/04 14:42

By:Brian McGleenon

Major cryptocurrencies, like bitcoin and ether, are set for significant near-term price fluctuations, analysts said.Investors could gain by exploiting increased short-term price volatility, while also considering seasonal trends that suggest a bullish fourth quarter, analysts added.

Major cryptocurrencies, such as bitcoin and ether, are likely to see larger price movements in the near future, according to analysts.

"QCP's Volatility Momentum Indicator (VMI) has been triggered this morning for major cryptocurrencies, both bitcoin and ether, indicating that the market is entering a period of heightened volatility," QCP Capital analysts said. This signal is directionally agnostic, meaning it does not indicate spot direction, but suggests that larger price movements are likely in the near term, the analysts added.

The QCP Capital analysts said that based on the latest implied volatility signals, investors might want to shift their strategy from yield-generating investments to buying options to capitalize on potential large price movements in bitcoin .

Upcoming U.S election could drive market volatility

One analyst pointed to anticipation surrounding the upcoming U.S. presidential election as a driver of volatility in the cryptocurrency market.

"The market continues to price in elevated three-month volatility, motivated by anticipated volatility stemming from the U.S. election," said K33 Research's Ventle Lunde. He added that the options market shows that investors are cautious about short-term price movements, but remain optimistic about bitcoin’s performance in the medium term.

Although near-term price predictions are bearish, Lunde sees an opportunity to buy a dip before a recovery that could begin in October.

"Market fundamentals are solid, and several factors point towards a positive tidal change, making September a ripe opportunity to enter with aggression," the K33 Research analyst said. He also sees momentum rising in the months leading into the U.S. presidential election on Nov. 5.

"A Trump victory would likely be met with a bullish response, whereas a Harris victory would be viewed as a status quo for the industry in the U.S.," he added.

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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