Ripple Swell has started: Event-Driven Trading Strategy 101
The Ripple Swell Conference will begin in next few hours with President Bill Clinton’s Keynote Speech. All of us want to use this event to make a profit, which is practically not possible. Since the markets are zero-sum, so most of us will lose, and some will make a profit.
Traders are using all sort of strategies like Technical analysis of XRP based on order books and Level II quotes. Others are waiting for signals from the Swell conference, which can be the form of an announcement to launch XRapid or other partnerships of Ripple.
In this article, we’ll take a look at trading strategies especially for this event, i.e., Ripple Swell Conference, and how they can be used for day traders to improve their chances of profit-making.
This article is not financial advice and should not be confused with full-proof signals. This article will only cover some strategies that you may want to use and are solely the writer’s opinion.
Scenario 1: President Bill Clinton’s Speech Starts: Market breaks either upside or downside
There is a considerable possibility that the market will have a breakout due to Bill Clinton’s speech.
The signal can be confirmed if the market breaks a substantial resistance level. If XRP price can break through $0.606 level, it can break upside to the next historical level of $0.692, further to $0.758 and $0.926 levels.
The market can break the downside if no strong signal is provided during the speech by Bill Clinton. And traders can react with negative sentiment.
This can be confirmed if the market can break a substantial support level. If XRP comes below $0.502 level, a breakdown can happen to the next historical level of $0.436, to $0.326 and further to $0.270
Scenario 2: Ripple announces the launch of xRapid during the event
Ripple recently announced the launch of its next-generation payment system, xRapid, but no date of commencement was given out.
The chances are that xRapid is launched during the Swell Conference and this can result in very positive sentiment, and a breakout happens upwards
Scenario 3: Ripple announces a significant partnership/partnerships
If Ripple announces an essential collaboration during the event, the chances of which are scarce, the market can break upside with a positive sentiment.
Scenario 4: No positive announcement happens
There are chances that the event has nothing to announce at all. It can be just a regular yearly meeting of Ripple’s partners.
If this happens, the price of XRP can break down to the level of $0.326 and even to $0.270 from which it rose a few days back.
Risks & Limitations
Event-driven trading represents an excellent way to benefit from expanding unpredictability, yet the strategy isn’t with no threats. Given the extended volatility, there’s a hazard that XRP could recoup similarly as fast as it fell or the other way around.
Some essential dangers and constraints to consider include:
Volatility – Volatility is a twofold edged sword in that any potential increment in upside is joined by a possible increase in drawback hazard, which makes it essential for a broker to comprehend the occasion and set up tight hazard controls completely.
Whipsaw – Some trading occasions may cause whipsaw price action that can trigger stop-loss focuses before an exchanging postulation can emerge, which implies that merchants should keep free stop-misfortune focuses on allowing some unpredictability to happen.
Knowledge – Many market-moving events are very involved, which makes it hard to decipher and process the data completely. For example, preliminary clinical outcomes might be difficult to interpret right away as tremendous or terrible before the value moves generously.
The Bottom Line
With a tremendous amount of hype for the Ripple’s Swell Conference, there is an excellent opportunity for you to capitalize on increasing price action of XRP, but there are many risks and limitations to consider. When developing your strategy for trading during this 2-day event, it’s essential for traders to set up tight risk controls for themselves.
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