Triple Witching Day Brings Volatility to Crypto Markets
After the recent events like the FOMC minutes and the digital asset summit, the crypto market is now bracing for the impact of Triple Witching Day. This phenomenon, which refers to the simultaneous expiration of options and future contracts, has the potential to shake up the volatility of the market, especially if it has been stagnant for a while.
Currently, there are over $2 billion worth of Bitcoin and Ethereum options set to expire, leading investors to closely monitor for any potential shifts in the market. This time around, the presence of “crypto degens” has added an extra layer of intensity to the situation. These are traders who engage in high-risk and speculative trading strategies, further fueling the anticipation of potential market movements.
According to data from Coinglass, around $50 million in leveraged liquidations are set between the $85,815 and $82,950 levels for Bitcoin. This suggests that significant price action is expected once the options expire and potentially influence the price movement of BTC. With equal bullish and bearish pressure currently in play and low volume, Bitcoin appears to be in an extreme price squeeze, hinting at a looming major price movement.
Despite a recent pullback, Bitcoin is still trading within a rising parallel channel in the short term but has dropped below the average. The stochastic RSI indicator is approaching the lower threshold, indicating a potential bullish rebound on the horizon. The 50-day moving average is acting as a strong support level, helping to stabilize the price amidst bearish pressure.
As the liquidation levels remain distinct, Bitcoin will need to see a 3% to 5% upswing or pullback to trigger any significant price movements in either direction.