My Post-Election Strategy for the Crypto Market

With the U.S. elections looming, the crypto market anticipates that a Trump victory could fuel a record-breaking surge due to his pro-crypto stance. On the flip side, if he loses, many expect a severe crash. As an investor, my approach isn’t to pick sides but to prepare strategic plans for both short- and long-term outcomes.

Why I’m Bullish on Q4 2024 and Beyond

Before diving into my short-term strategies, I’ll highlight why I’m especially optimistic about Bitcoin and the broader crypto market through Q4 2024 and into 2025. I’ve covered these reasons in depth previously (read the full article here), but here’s a brief summary of the key points:

1. Historical Patterns: In the last three election years (2012, 2016, and 2020), Bitcoin has shown post-election growth, with gains between 100% and 300% by the end of Q4. There’s little reason to expect a different outcome this time.

   
   

   

   
   

2. Monetary Policy Shifts: As central banks begin lowering interest rates and quantitative easing resumes, global liquidity will increase. Expect capital inflows into markets, boosted by central bank moves like treasury securities purchases and reduced borrowing costs.

3. Institutional Adoption: Bitcoin ETFs have consistently set records. In less than a year, nearly 1 million Bitcoin have been accumulated, led by BlackRock’s landmark ETF, which holds 417,000 Bitcoin (~$30 billion) and is the most successful ETF launch in history. You can monitor Bitcoin ETF holdings, including daily inflows and outflows, here.

With this long-term outlook, here’s how I plan to navigate the short term, including preparing for a potential altcoin season.

My Three-Scenario Strategy

Given the high-stakes election environment, I’m structuring my strategy around three possible outcomes:

1. Trump Wins, and a Bull Run Follows: The market gains momentum, retail investors pour in, and altcoin season follows.

2. Trump Wins, but the Market Falls (Buy the Rumor, Sell the News): We could see a dip driven by profit-taking.

3. Kamala Wins, and Market Panic Ensues: This could lead to a major downturn with high volatility. Markets hate uncertainty.

   
   
   
   

Scenario 1: Trump Wins, and a Bull Run Follows

In this scenario, there are no surprises—the market ascends as anticipated. I currently hold a portfolio heavily weighted toward Bitcoin (80%). I’ve been stacking fiat for the past 4-5 months in preparation for an altcoin season, which typically follows strong Bitcoin performance (my altcoin peaks are published on our Telegram channel if you are interested)

Altcoin season, for newcomers, occurs when altcoins (cryptos besides Bitcoin) outperform BTC. While Bitcoin might see 2x-3x returns, some altcoins can rally 6x-10x.Over the past three years, Bitcoin has consistently outperformed altcoins. However, during a bull run, a phase often emerges when altcoins start to outpace Bitcoin’s growth. This phase, known as “altcoin season,” is both highly lucrative and high-risk. Timing altcoin season can be challenging; even more challenging is knowing when to exit, as altcoins often reach unsustainable valuations driven by heavy speculation. Many of these altcoins risk crashing dramatically—some losing up to 99% of their value once the hype subsides.

So why do investors flock to these volatile assets? Human nature plays a big role. In times of economic expansion and easing monetary policy, people often feel euphoric and increase their risk tolerance, chasing higher potential returns. This leads them to accumulate lower-market-cap altcoins, drawn by the allure of exponential gains, but often underestimating the risk of capital loss.

Altcoin season can indeed multiply a portfolio’s value for those who navigate it skillfully, but without a clear exit strategy, it can also decimate it. To maximize gains and minimize losses, having the right tools and preparation is essential (e.g Altcoins Season Index).

Scenario 2: Trump Wins, but the Market Drops

If a Trump victory triggers a market drop, we could see a classic “buy the rumor, sell the news” event. This scenario might be an attempt to shake out weak hands through Fear, Uncertainty, and Doubt (FUD). Here, I anticipate either a quick recovery (making Scenario 1 still applicable) or a possible test of Bitcoin’s bull market support band around $63K.

If this level doesn’t hold, extreme market fear could ensue. In that case, I’ll shift the capital I saved for alctoicns to Bitcoin with a Dollar-Cost Averaging (DCA) approach, targeting the $55K-$48K range. Based on my BTC bottom model ( RANSAC fit), $48K is the expected bottom. I plan to enter gradually, starting at $55K, confident that 2025 holds strong growth potential for crypto. As the altcoin season kicks in, I’ll reallocate this BTC allocation alongside profits to altcoins when I feel comfortable that the altcoins season has started.

Scenario 3: Kamala Wins, and the Market Crashes

A Kamala victory could unleash rapid downside volatility, likely testing Bitcoin’s bull market support band much faster than in Scenario 2. I am prepared to exit with 10-15% of my Bitcoin holdings, aiming to re-enter either at the bull market support band (see chart below) or near my calculated bottom price (explained in scenario 2 above), as long as Bitcoin risk remains below 45%.

Our quant risk management algorithm, tested over 14 years, guides my decisions, and you can explore its performance here. Should both conditions align, I’ll deploy my altcoin reserve capital into Bitcoin, and I will DCA between $55K-$48K (same as scenario 2).

Remaining Dynamic Amid Market Uncertainty

Unless I see clear signs that 2025 won’t deliver strong crypto growth, I’ll stay with this plan. As always, I monitor over 1,000 charts daily to refine a strategy that lets me sleep well, adapting dynamically to the market. I urge you, too, to stay informed and responsive in this ever-changing landscape. Please note that this is not financial advice—just an outline of my personal strategy based on my analysis and experience.

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