QCP: The election will once again be a "good news is out" market, and traders are increasing downside protection positions

BlockBeats news, on November 2, QCP released a weekend summary saying that Thursday's core PCE data was slightly higher than expected (actual year-on-year growth of 2.7%, expected to be 2.6%). In contrast, Friday's non-farm payrolls (NFP) data was unexpectedly lower than expected (actual 12,000, expected to be 110,000), causing the US dollar index (DXY) to rebound and return to the 104 level.

Bitcoin hit an all-time high on Tuesday night, trading as high as 73.6k, driven by market expectations for election week. Although Bitcoin performed well this week, Ethereum was relatively flat and failed to break through the 2.7k mark. Against the backdrop of strong ETF inflows, Bitcoin had a net inflow of more than $2.1 billion this week.

Despite Bitcoin’s fall below $69,000 on Friday, market interest remains strong, with total Bitcoin futures and Bitcoin options open interest remaining at $40.65 billion and $25.3 billion, respectively. With short-term implied volatility still above 72 ticks heading into the upcoming election week, bearish bias has increased for Bitcoin and Ethereum, with traders adding downside protection positions.

Despite Trump being considered the favorite to be the next U.S. President, Trump’s odds on Polymarket have fallen from a high of 66% to 57%, while Harris’s odds are at 43%. Regardless of the outcome, we believe the election will see a repeat of the “all-out” scenario, similar to what happened after the Nashville Bitcoin Conference.