Looking back at the past U.S. election years, the S&P 500 and Bitcoin both have a high probability of ending higher in November and December following the election results. Is this also a good opportunity for investors to position themselves?
(Background:
Key timelines of the U.S. elections, economic policies of both parties, and subsequent market impacts at a glance)
(Additional Context:
Will Bitcoin reach new highs after the U.S. election? How to maximize profits in a highly volatile market)
Table of Contents
– S&P 500 Index
– Bitcoin
– Bitcoin’s market share reaches a two-year high
The highly anticipated U.S. presidential election is set to officially begin counting on November 6, Taiwan time. However, due to the different economic and military policies that may be brought by the Republican and Democratic parties, the outcome of the election also affects the hearts of global investors. People are speculating on what impact this U.S. election will have on stocks, Bitcoin, and other assets.
Against this backdrop, this article will organize the performance of the S&P 500 index and Bitcoin after the results of past U.S. elections to provide investors with some reference data.
S&P 500 Index
As one of the four major stock indices in the U.S., the S&P 500 index has been recording the performance of the U.S. stock market since 1957, covering the total market value of approximately 80% of listed companies in the U.S. According to statistics, the performance of the S&P 500 index in November and December after the results of the past ten U.S. presidential elections is as follows:
– 1984: November up 3.5%, December up 2%
– 1988: November up 2%, December up 1.5%
– 1992: November up 1%, December up 1.2%
– 1996: November up 2.5%, December up 1.8%
– 2000: November down 8%, December up 0.4%
– 2004: November up 3.5%, December up 3.2%
– 2008: November down 7.5%, December up 1%
– 2012: November up 0.3%, December up 0.7%
– 2016: November up 3.4%, December up 1.8%
– 2020: November up 10.8%, December up 3.7%
It can be seen that the S&P 500 index only experienced declines in November of 2000 and 2008 after the results of the past 10 U.S. elections, with an 80% chance of rising in November; and in December, the probability of rising in election years reached 100%.
The declines in 2000 and 2008 were due to specific economic events leading to abnormal fluctuations, as the dot-com bubble and the global financial crisis occurred in those years, respectively. Although the U.S. has repeatedly stated that it will achieve a soft landing this time, whether it can smoothly sail through in the long term remains unknown.
Bitcoin
According to Coinank data, Bitcoin’s performance in November and December of the two election years in the past decade is as follows:
– 2020: November up 42.95%, December up 46.92%
– 2016: November up 5.42%, December up 30.8%
It can be seen that Bitcoin had a 100% chance of rising in November and December after the results of the recent two elections, almost marking the highest monthly increase of the year.
Combining the above data, it can be seen that Bitcoin and U.S. stocks tend to rise following the U.S. election results. However, it is worth noting that history does not simply repeat itself, and investors should remain cautious and not overly rely on historical data to increase leverage.
Bitcoin’s Market Share Reaches a New High in Nearly Two Years
Worth mentioning, according to TradingView data, Bitcoin’s market share (BTC.D) has now reached 60%, marking a new historical high since 2021.
Looking back at history, when Bitcoin’s market share exceeds 50%, it means that Bitcoin’s dominant position in the overall cryptocurrency market is stronger, possibly indicating the early stages of a bull market or increased market risk aversion; whereas when Bitcoin’s market share gradually decreases from a high level and the price corrects, it may mean that funds are flowing out of Bitcoin, triggering an altcoin explosion.
Bitcoin Market Share
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