Bitcoin finds limited support from US Dollar weakness as Democrats gain ground in US midterms

• With selling pressure building on Wednesday, Bitcoin slips below $76,000 and tests its 200-day EMA near $76,501.
• At 101.3 early on Wednesday, the US Dollar Index is lower amid uncertainty surrounding the US midterm elections.
• Early results put Democrats on course for a sweeping win in both houses.

A decline of nearly 2% on Wednesday leaves Bitcoin (BTC) below $76,000 as it tests the 200-day Exponential Moving Average (EMA) baseline near $76,501. The retreat comes alongside a weaker US Dollar (DXY), a development that would normally favour risk-sensitive assets. Selling pressure coincides with the US midterm elections, with early results showing Democrats making gains in both houses. 

Democrats move towards a US midterm sweep

Democrats are leading gains in both the US Senate and the House of Representatives, according to early midterm election results. An outright majority requires Democrats to secure 218 seats in the House of Representatives and 51 seats in the Senate.

A Democratic sweep also has the backing of social sentiment in these midterm elections. Kalshi’s forecast puts the probability of Trump losing control of both houses at 100%.

Bitcoin fails to benefit from a weaker US Dollar

A fall to 101.3 takes the US Dollar Index to a fresh 30-day low on Wednesday as selling pressure emerges. Lower US Treasury yields are also weighing on the US Dollar: the 2-year bond yield has dropped 5 basis points (bps) to 4.566%, while the benchmark 10-year yield has declined 6 bps to 4.90%, according to earlier reporting by FXStreet. Uncertainty over the US midterms accompanies this weakness, as Republicans lose control and President Trump's fiscal and economic agenda faces gridlock.

Although a softer US Dollar would normally favour risk-sensitive assets such as Bitcoin, BTC is also under selling pressure, falling 2% on Wednesday to trade below $76,000. The failure to benefit from dollar weakness suggests that midterm election risks are outweighing the currency’s decline.

A close below the 200-day EMA at $76,500 remains a risk for BTC and could reinforce bearish control. The horizontal level near $75,545 provides immediate downside support. A break beneath it would bring the next bearish targets of $70,505 and $67,292 into view.

Conversely, the first indication that selling pressure is easing would be a daily close above the 200-day EMA at $76,500. The 50-day EMA at $79,965 would, however, present stronger resistance.

(The technical analysis of this story was written with the help of an AI tool. Know more.)