Bitcoin Breaks Above $80K and Ethereum Rallies Following Trump Victory and Fed Rate Cut

Bitcoin (BTC) hit a new all-time high of $80,000 and maintained bullish momentum. Donald Trump’s victory on November 5 partly drove this rally. The US Federal Reserve’s 25-basis-point rate cut further fueled this rally. The rate cut boosted investor confidence, creating additional upward pressure as the market expected more capital inflow into risky assets. On-chain data reveals significant buying interest from US-based traders on Coinbase. This has resulted in a slight premium in Bitcoin’s price on the platform compared to global exchanges like Binance.

On the other hand, Ethereum (ETH) addresses transparency concerns through the Ethereum Foundation’s (EF) 2024 annual report. The report details that the foundation’s $970 million treasury holds 81.3% in cryptocurrency assets, primarily Ether (ETH). It follows a $94 million ETH transfer to Kraken, which was clarified as part of EF’s “treasury management.” EF has also introduced a mandate requiring members to disclose conflicts of interest for investments over $500,000. This measure ensures integrity in decision-making processes involving significant asset holdings. Ethereum has formed a bottom and surged higher following Donald Trump’s victory. The price is now on track to reach record levels.

Bitcoin Dominance and US Premium Trends

The chart below shows Bitcoin’s dominance over time. Bitcoin’s dominance is around 58.83%, indicating that Bitcoin holds more than half of the total crypto market value. Furthermore, a rising dominance level suggests that Bitcoin outperforms other cryptocurrencies, as investors may focus on Bitcoin rather than altcoins. Typically, investors drive this trend during uncertain market conditions, viewing Bitcoin as more stable than other cryptos.

However, short-term trends show that the dominance level decreased in November following the US election. This decline in dominance indicates a shift in interest toward alternative coins.

Moreover, the Coinbase Premium Index for Bitcoin shows the price difference for Bitcoin on Coinbase compared to other exchanges. An increase in the premium index from a negative level to a higher value indicates increasing buying pressure from US-based traders on Coinbase.

A positive premium suggests US investors are willing to pay more for Bitcoin, signaling strong local demand and potential bullish sentiment in the US market. Donald Trump’s victory triggered this increase, indicating bullish sentiment following the US election. The increase in the premium index can drive the price of Bitcoin higher.

Bitcoin (BTC) Technical Analysis

Bitcoin Monthly Chart – Start of Parabolic Surge

The monthly chart for Bitcoin shows that the price has broken out from a long-term pivotal area, signaling the start of the next surge. The black arc, drawn from the 2013 high, represents a significant resistance level, and this was the sixth time Bitcoin touched the arc. The market has broken through this sixth touch, initiating the next upward move.

The long-term bull trend in Bitcoin shows that the market has bottomed four times, each leading to a strong upward move. Each surge begins with a breakout above a key resistance line, marked by the red line in the monthly chart below. The recent breakout above $75,000 suggests the price is heading towards the $100,000 area.

Bitcoin Weekly Chart – Breakout from Cup Pattern

The weekly chart for Bitcoin shows that prices have formed a cup formation from 2021 to 2024. Following the U.S. presidential election, Bitcoin initiated a breakout from this cup in the last quarter of 2024. Interestingly, prices formed a descending broadening wedge pattern before breaking out from this cup. This pattern suggests that prices will continue higher toward the target of $100,000. This target is determined by a trend line extended from the 2021 highs.

Bitcoin Daily Chart – Breakout from Descending Broadening Wedge

The descending broadening wedge is also observed in the daily chart, which shows that the price formed a bottom after breaking out from this wedge. The 50 SMA crosses above the 200 SMA right at the breakout of this descending broadening wedge pattern, indicating that this breakout marks the start of a new uptrend, and prices are likely to surge higher.

Ethereum (ETH) Technical Analysis

Ethereum Monthly Chart – Bullish Pennant

The monthly chart for Ethereum shows that the price is trending higher within a bullish pennant. This trend began after consolidating in support of the pennant, indicating that the next surge might be stronger. The long-term pattern displays the formation of a double bottom followed by the bullish pennant, suggesting a long-term parabolic potential in Ethereum’s price. A break above $3,759 could take Ethereum to new record levels.

Ethereum Weekly Chart – Bottom Formation

The weekly chart for Ethereum also shows a bullish formation, represented by the black arc at the bottom. Before the US election, price consolidation had formed a strong bottom, and the price is trending higher. A break above the black downward trend line will initiate the next surge in Ethereum prices.

Ethereum Daily Chart – Bullish Price Action

The daily chart for Ethereum shows consolidation, where each price drop was reversed with a strong upward move. The price also broke above the black trend line at $2,940, intersecting with the 200 SMA, indicating an upward trend. The price is now approaching the black dotted trend line, seen as the resistance line of the bullish pennant in the monthly chart. A break above this dotted trend line will initiate the next surge in Ethereum.