What is the Triple Witching Event?
What does this triple witching event mean? Well, it’s the expiration of stock options, stock index futures, and stock index options all hitting at the same time. This happens four times a year, and it’s typically a recipe for market chaos. As $4.5 trillion worth of contracts are set to expire, traders are preparing for a rocky ride.
Cryptos like Bitcoin, Ethereum, and Ripple often mirror the stock market, making them particularly vulnerable to this kind of volatility. So, it’s no surprise that the anticipation of this event is sending a shiver down the spines of many investors.
Crypto Prices Ahead of the Event
Up until now, Bitcoin has dropped from a weekly high of $87,158 to around $83,580. Ethereum has dipped below $2,000, and Ripple has sunk from $2.59 to $2.35. These price shifts suggest that traders are getting jittery ahead of the triple witching event.
The trends are showing that major cryptocurrencies are forming bearish patterns, hinting at more drops to come. It’s the kind of environment where investors need to keep their eyes peeled for any shifts.
Technical Patterns in Major Cryptos
Bitcoin's Rising Wedge Pattern
Bitcoin is showcasing a rising wedge pattern, with upward and converging trendlines. The double-top formation at $108,150 further suggests a fall is on the horizon, with a projected immediate target of around $76,890.
Ethereum's Triple-Top Pattern
Ethereum is forming a triple-top pattern at $4,005, with a neckline at $2,140. This generally indicates a bearish breakout. With its price currently below the neckline and both the 50-week and 200-week moving averages, further drops could lead it to the psychological level of $1,500.
Ripple's Head and Shoulders Pattern
Ripple has formed a head and shoulders pattern, with the neckline at $1.93. Recent positive news about the SEC lawsuit hasn’t helped it break above the shoulders level, indicating further declines could be on the way. Below the neckline, it could target $1.
How to Manage the Upcoming Volatility
With the impending uncertainty of the triple witching event, here are some strategies to keep in mind:
First, diversification across different cryptocurrencies can soften the blow of price fluctuations. It wouldn’t hurt to dip into stablecoins as well.
Second, risk management techniques like stop-loss orders and position sizing are essential during these volatile times. Make sure to reassess your risks regularly.
Third, stablecoins can be your saving grace when things get hairy. They maintain a steady value compared to fiat currencies.
Fourth, using a dollar-cost averaging strategy to buy crypto regularly can soften the impact of price changes.
Finally, stay informed and be ready to adjust your strategies based on what’s happening in the market.
Strategies for Fintech Startups in Crypto
For fintech startups in the crypto game, adapting your investment strategies is crucial:
Start with risk management. Diversifying and using hedging strategies can help protect against market swings.
Next, watch the market patterns of cryptocurrencies closely. This will help you adapt your strategies as needed.
Embrace technology. AI and automated trading platforms can get you through choppy waters.
Regulatory compliance should be top of mind. Knowing the rules can enhance confidence in your company.
Lastly, think long-term. While short-term gains are attractive, stable growth is what you want to focus on.
By paying attention to the potential impacts and adapting your strategies to the event, investors and fintech startups alike can survive the volatility.
