The Federal Reserve's balance sheet reduction operation is like an endlessly pumping water machine—drawing away 95 billion US dollars every month. Now their balance sheet has shrunk by 1.3 trillion from its peak, what does that mean? It's equivalent to withdrawing 3.1 billion cash from the market every day.

Last week's ten-year US Treasury auction was brutal, with the "tail discrepancy" soaring to 0.3 basis points. This number sounds small, but in the bond world, it's as embarrassing as failing an exam. Now even the most conservative grandma investment groups have pulled out, while tech stocks are still clinging to a 32 times price-to-earnings ratio.

The interest rate cut is even more absurd; the Federal Reserve plays the "wolf is coming" trick every day. The market is now like a startled bird, with the probability of a rate cut in September dropping from 85% to 55%, and the probability of a rate cut before December is fluctuating like a roller coaster. Gold has been confused, dropping 12% from its peak of 3500, while the US dollar index is doing well, rising to 100—it’s faster than a Sichuan opera face change.

If you want to talk about the surreal, just look at the situation in the Middle East. The Houthis just gave a cargo ship the green light last week, Israeli warplanes bombed airports at midnight like it was fireworks, and Iran's nuclear facilities have been "setting off fireworks" every few days. So what’s the result? WTI crude oil has been drawing a complete ECG in the 78-82 dollar range for 17 days, with trading volume shrinking to an average of 620,000 contracts a day, which is half of what it was at the beginning of the year. OPEC+ claims that global crude oil inventories are increasing by 1.8 million barrels daily, while the IEA has cut next year's demand growth forecast to 990,000 barrels—this number is even lower than the turnover rate of the Sha County snacks downstairs in my building.

Now friends engaged in contract trading are going crazy, with Bitcoin futures open interest surpassing 18 billion US dollars, but the actual volatility has dropped to 22%. The funding rate for perpetual contracts is dancing between ±0.01%, and even the most aggressive grid trading strategies are kneeling.

So what strategy is the most reliable now? Turn off the trading software and invite your buddies to KTV to shout a few songs. When the market draws a mirage in the dark desert, don’t be in a hurry to reach for your wallet; first, check if your compass in your pocket is still there—after all, when the dealer reshuffles, they never tell you which side to bet on.