The Next Quadruple Witching: How Will Bitcoin React?
On 15 September, brace yourself for the next quadruple witching event, a time when major contract expiries happen simultaneously. This event triggers a surge in trading volume as traders rebalance their portfolios, and it can potentially signal a change in the direction of Bitcoin.
Quadruple Witching - An Arcane Event?
Contrary to its mystical name, the quadruple witching event has nothing to do with the occult. It simply refers to the simultaneous expiry of four different contracts that occur four times a year. These contracts include index futures, stock futures, index options, and stock options. Although U.S. single-stock futures are no longer counted, the event is still referred to as the quadruple witching.
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Previous Quadruple Witchings and Bitcoin’s Trend
In the last quadruple witching event on 16 June, Bitcoin experienced a significant surge, reaching a new local high of nearly $32,000. However, previous events, such as the one on 16 December 2022, resulted in a dump followed by a sideways trend. It’s important to note that the trend of Bitcoin can go in any direction, including up, down, or sideways. Recently, Bitcoin has mostly traded sideways with occasional spikes.
The Significance of the U.S. Dollar Index (DXY)
The U.S. Dollar Index (DXY) plays a crucial role in the Bitcoin market. The DXY has been steadily climbing since mid-July, currently residing at 104.7. If the dollar surpasses the resistance level at 105.6, it could have a negative impact on Bitcoin and the overall crypto market. There is a possibility that the dollar could rise to challenge the high last seen in September 2022 at 114.8.
Watching for the Bitcoin Stochastic RSI
Another important indicator to keep an eye on is the Bitcoin stochastic RSI on the higher weekly time frame. It is nearing a reset, and if it crosses to the upside, it could align with the quadruple witching event. Stay tuned to Crypto Daily for the latest updates on these unfolding events.
Hot Take:
The upcoming quadruple witching event presents an intriguing opportunity for Bitcoin. As traders rebalance their portfolios, the surge in trading volume may indicate a shift in Bitcoin’s direction. However, it’s important to consider external factors, such as the U.S. Dollar Index, which could potentially impact Bitcoin’s performance. Stay informed and watch for potential indicators like the Bitcoin stochastic RSI.
