Bitcoin Retakes 200-Day Average as \'Trump Trades\' Back In Vogue After Weekend Attack

The weekend attack on pro-crypto presidential candidate Trump should galvanize bids for cryptocurrencies, one observer said.

pro-crypto presidential candidate Donald Trump was the subject of an assassination attempt on Saturday. This event has sparked a renewed surge in activity for assets linked to Trump's probability of winning the Nov. 4 elections.

CoinDesk data show that bitcoin (BTC) has rallied by 7% to reach $62,500 since the weekend attack, which has boosted the pro-crypto candidate's probability of winning the elections to 70% on Polymarket.

The leading cryptocurrency by market value has also crossed the crucial 200-day simple moving average (SMA), which serves as a key technical indicator for momentum traders, as well as the trendline that marked the downtrend from early June highs.

Trump-themed Polifi tokens, which are at the intersection of politics and finance, also saw a surge.

In recent months, Trump has shifted his stance and embraced crypto in an attempt to outflank his rival, Joe Biden, and gain favor with the crypto community, which is seeking a friendlier regulatory environment for the industry. As a result, bitcoin and the broader crypto market have become bets on Trump's victory.

The former president is set to speak at the Bitcoin 2024 conference in Nashville, Tennessee, on July 27.

“The biggest fundamental news over the weekend was the Trump assassination attempt. Absolutely insane. This has improved the odds of a Trump presidency. Trump being the pro-crypto president should help galvanize the cryptocurrency bids,” Greg Magadini, director of derivatives at Amberdata, stated in an email.

In other markets, the Chinese yuan (CNY) declined against the U.S. dollar amid speculation that a Trump victory could lead to higher trade tariffs.

Earlier this year, Trump suggested revoking China's "most favored nation" status for U.S. trade and imposing tariffs of over 60% on Chinese goods.

The Mexican peso (MXN) also slipped due to Trump's strained relations with the Latin American nation during his previous presidential term.

Prices for futures tied to the 10-year Treasury note decreased, indicating higher yields as Trump's return to the White House would likely result in increased spending, tax cuts and higher budget deficits. Several investment banks are betting that a potential Trump victory would steepen the presently inverted yield curve in the coming months. Historically, sharp steepening has led to broad-based risk aversion in financial markets.

Futures tied to the S&P 500 were trading up 0.18% at last check, signaling a positive open on Monday as Asian stocks dipped on the back of disappointing economic growth figures in China.

The dollar index, which tracks the greenback's value against major fiat currencies, was up 0.10% to 104.19, according to TradingView.

Omkar Godbole is a Co-Managing Editor on CoinDesk's Markets team.

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