Such an outcome could complicate President Donald Trump’s legislative agenda over the next two years, Thompson said, although he cautioned that midterm polling has historically been unreliable.
Hilbert said its “desk is running relatively light on risk” as it monitors three major uncertainties involving the elections, the aftermath of the Binance hack and a US military buildup in the Middle East.
Thompson also warned that tensions in the Middle East could escalate within the next two weeks, suggesting Trump may refocus on the region once the elections conclude.
Bitcoin tests critical support as options traders turn defensive
Bitcoin is testing technical support near $78,000 after the Binance hack triggered an approximately $4,000 price move and broke its initial trend line support, according to Thompson.
He identified a support zone between $76,000 and $78,000, followed by additional levels at $74,000 and $72,000. Short term momentum indicators have remained negative since October 9, when Bitcoin traded near $85,000.
Options markets also indicate growing demand for downside protection, with five delta puts trading at a 13 point premium to at the money volatility, compared with roughly two points for equivalent calls.
The options market’s maximum pain level stands near $75,000, while Thompson identified $77,000 as immediate support and $79,000 to $79,500 as resistance over the next 48 hours.
The defensive positioning comes as the Federal Reserve faces renewed expectations of further monetary tightening. Thompson cited strong economic data and hawkish comments from Fed Chair Kevin Warsh, with futures markets pricing approximately a 72% to 73% probability of another rate hike in December.
Meanwhile, Thompson said the Binance breach increasingly appears linked to North Korea, although that attribution remains unconfirmed.
The exchange experienced approximately $3.5 billion in withdrawals after reopening over the weekend, compared with more than $170 billion in assets held on its platform, according to Hilbert.
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