On August 1, global financial markets experienced a severe turmoil, and the cryptocurrency market was no exception. BTC fell to 112,751 USDT in the early morning, erasing nearly three weeks of gains, hitting a new low since July 10, and at the time of writing, BTC is priced at 113,639 USDT. ETH also fell to a recent low of 3,431 USDT in the early morning.

According to Coinglass data, $726 million in liquidations occurred across the network in the past 24 hours, with $640 million from long positions and $86.85 million from short positions. Additionally, the liquidation for ETH in the last 24 hours was $270 million, surpassing BTC's $165 million.

Crypto-related stocks in the U.S. market performed poorly, with Coinbase closing down 16.7% yesterday, Riot Platforms down 17.75%, and Circle down 8.4%. This indicates that investors' risk appetite for crypto assets is decreasing.

The weak U.S. employment data, Trump's intense political reaction, and rising geopolitical risks have collectively triggered significant market volatility.

Macroeconomic environment: The collapse of U.S. employment data triggers market shocks.

On the evening of August 1, Beijing time, the U.S. Bureau of Labor Statistics released the July non-farm employment report, which indicated that U.S. non-farm employment increased by only 73,000 in July, significantly below the expected 104,000, marking the smallest increase since October of last year. Even more shocking to the market, the Bureau of Labor Statistics also significantly revised down previous data, lowering the combined employment figures for the previous two months by 258,000.

Trump's strong response: Immediately fire the Director of the Bureau of Labor Statistics.

U.S. President Trump reacted strongly to the weak employment data, posting on social media to accuse the Bureau of Labor Statistics Director Erika McEntarfer, appointed by Biden, of falsifying employment data before the election, stating, "Non-farm employment data has been manipulated to embarrass me." He ordered the immediate firing of Erika McEntarfer just hours after the non-farm employment report was released. William Wiatrowski will take over as Acting Director of the U.S. Bureau of Labor Statistics.

Trump stated, "We need accurate employment data. Such important data must be fair and accurate; it cannot be manipulated for political purposes." He also criticized the Federal Reserve for "playing tricks" by significantly lowering interest rates twice before the presidential election, implying that Powell should also "retire."

In addition, Federal Reserve Governor Kuger announced his resignation effective next week, providing an opportunity for Trump to appoint his favored candidate, which could have significant implications for future Federal Reserve monetary policy.

Rising geopolitical risks.

In addition to economic data, geopolitical risks are also escalating. Trump announced on social media that based on the "provocative remarks" of former Russian President Medvedev, he has ordered the deployment of two nuclear submarines to the vicinity of Russia.

This series of events directly triggered a sharp decline in all three major U.S. stock indices. On August 1, U.S. stock markets evaporated over $1 trillion in market value in a single day. Meanwhile, risk aversion surged, with gold prices skyrocketing, breaking through the $3350 per ounce mark, and reaching $3362 per ounce at the time of writing.

August BTC enters the "Devil's Down Month."

Historically, the crypto market has performed poorly in August. According to statistics from Lookonchain, August and September have historically been the worst months for Bitcoin (BTC). Data shows that in the past 12 years, Bitcoin prices fell in August and September in 8 of those years, with a decline probability of 67%.

The market faces a critical turning point: Short-term correction or long-term consolidation?

Currently, the market is facing a critical question: Is this pullback a healthy short-term correction, or are we about to enter another long-term consolidation phase?

Following this data event, market expectations for a Federal Reserve rate cut in September continued to rise. CME's "FedWatch" data shows that the probability of a 25 basis point rate cut in September has risen to 89.8%, while the probability of maintaining the current rate has dropped to 10.2%. The cumulative probability of a 50 basis point cut in October has reached 51.8%. From a macro perspective, weak U.S. employment data may accelerate the Federal Reserve's rate-cutting pace, which theoretically should benefit risk assets, including cryptocurrencies.

ARK Invest increased holdings against the trend.

Notably, against the backdrop of increasing downward pressure on the market, investment firm ARK Invest increased its holdings on August 1, with multiple ARK funds simultaneously adding shares of Coinbase (COIN). The three funds ARKK, ARKW, and ARKF collectively purchased 94,678 shares of Coinbase stock, valued at approximately $33 million. Additionally, Ark Invest bought about $18.7 million of BMNR stock (a listed company using ETH as a financial strategy).

Whale games: Liquidation vs. Bottom fishing.

Regarding whale movements, some sold quickly while others bottom-fished: Arthur Hayes sold 2,373 ETH (worth about $8.32 million), 7.76 million ENA (worth about $4.62 million), and 38.86 billion PEPE (worth about $414,700) in the past 6 hours. At the same time, according to @ai_9684xtpa's monitoring, an address suspected to belong to Anchorage Digital appears to be buying 14,933 ETH through Galaxy Digital OTC, worth about $52.07 million. This address received these tokens 4 hours ago (almost at the rebound point for ETH) at an average price of $3,487.

Traders' perspective: Divergent opinions on technical analysis.

Investment firm DragonFly analyzed that a key accumulation liquidation area for Bitcoin has been marked, suggesting that the market might first test the liquidity above before exploring the liquidity area below. Notably, due to the flag technical formation of Bitcoin, there is a possibility of moving upward without touching the bottom liquidity. Although the current trend is unclear, it emphasizes that closely monitoring the BTC liquidity distribution map is crucial for grasping future market movements.

Bitcoin trader Crypto Bully pointed out that BTC ultimately broke below the lower range and fell below the volume-weighted average price bands (VWAP bands). He stated that he would maintain a short-term trading mode during the period when Bitcoin price rebounds to $115,000 or falls to $110,000, trying to seize short-term bullish opportunities before the Asian trading session.

Another analyst, Crypto Fella, presented a more cautious view, stating that "Bitcoin breaking below the support level of $114,700 could further test the support area of approximately $112,000 on the 4-hour chart."

Data analyst and quantitative trader Crypto Painter stated that the descending wedge for BTC has broken, and the price can only be treated as a descending channel until it returns to the wedge.

Meanwhile, crypto investor Sensei maintained an optimistic view, stating that the Bear Trap has ended, and preparations for an upward move can begin. Foresight News noted that a Bear Trap is an important phase in the market psychology cycle, referring to a situation where the market briefly declines and then quickly reverses upward, putting short-sellers in a losing position.