Yesterday, U.S. retail sales for May were weaker than expected, but consumer spending remains supported by robust wage growth. The dollar index weakened after the data release, but as the market digested the mixed signals from the data, the dollar quickly reversed its decline and ultimately closed higher.
The tensions between Iran and Israel have boosted demand for safe-haven assets, leading to declines in all three major U.S. stock indices.
Bitcoin's white plate dropped sharply until the early morning turning point, falling by 2%, a decline of over 5000 points, while Ethereum fell in sync with a decline of 4.85%, dropping over 200 points. The market clearly favored short positions, completely engulfing Monday's upward trend.
Yumi's white plate was scattered by shorts during the pullback, and after adjusting direction in the evening, short positions continued to reap benefits. This is how the cryptocurrency market works; while most people believe that the market will continue to surge after Monday's sharp rise, and bullish sentiment is rising, the dealer intervened and initiated a large-scale liquidation. After a brief morning pullback, it began to decline continuously from noon, leading to long positions being harvested.
At 8:30 PM, unemployment claims data will be released. The market is unlikely to see significant movements, mainly depending on the FOMC interest rate decision, with all eyes focused on this.
At 2:00 AM, the Federal Reserve is about to announce its interest rate decision, and then Chairman Powell will speak.
This meeting coincides with the initial effects of the 'Trump tariffs', as the market is deeply affected by geopolitical conflicts in the Middle East. The world is standing at a dual crossroads of monetary policy and geopolitical risks.
Most views suggest that the dot plot will indicate only one rate cut this year.
Multiple institutions expect the Federal Reserve to show a more hawkish stance in the latest dot plot and economic forecast, by reducing the number of rate cuts this year (most believe there will be only one cut or 25 basis points), raising the median interest rate forecast, and delaying the rate cut process. Additionally, short-term inflation risks and other factors have become key drivers for policy adjustments.
Other viewpoints:
Some institutions and experts point out that current U.S. economic forecasts carry adjustment risks for indicators such as GDP growth, unemployment rate, inflation, and long-term interest rates. The Federal Reserve maintains a cautious stance on rate cut decisions, with its policy actions strictly relying on data support.
Despite changes in the U.S. policy environment, the Federal Reserve still tends to adopt a wait-and-see approach. Different institutions have varying expectations for the number of rate cuts this year, and the dot plot may not see significant changes.
The market is focused on the Federal Reserve's policy statement, economic outlook, and how the dot plot will be adjusted. Be alert for sharp market fluctuations and manage positions carefully.
The market today is generally correcting the dual wash of long and short positions from the previous two days, experiencing a phase of oscillation and adjustment. Currently, the market fluctuations are not large, and it is estimated that everyone is waiting to see the latest news from the Federal Reserve in the evening. If the rate cuts are reduced to once, a sharp drop in the market is expected, at which point we will need to see the support strength at 100,000. If it rises, the resistance level above 107,800 is a recent barrier, and if it breaks through, there is another strong resistance point around 109,500. Currently, the market leans more towards the left side, making upward movement increasingly difficult.
In the short term, a rebound is possible, with shorts looking towards the 104,000/2480 area. Be cautious not to chase blindly; take profits directly if there are gains, and manage positions well.
For the medium to long term, it is advisable to first observe the evening market dynamics before making plans, to avoid counterproductive outcomes.
