Why did the market suddenly crash last night! Analysis by Brother Chao as follows
The U.S. July PPI data was released, with an annual rate of 3.3% significantly exceeding expectations of 2.5%, and the previous value revised from 2.30% to 2.4%; the monthly rate of 0.9% also crushed expectations of 0.20% and the previous value of 0.00%.
This means that the optimistic expectation of the Federal Reserve that "inflation is under control" has been debunked, and the logic of the cryptocurrency market trading on "the interest rate cut cycle starting earlier" faces correction.
Expectations of tightening U.S. dollar liquidity have restarted, which will suppress the valuation of risk assets—cryptocurrency assets like BTC and ETH are facing a transmission chain of "rising interest rate expectations → increasing funding costs → increased selling pressure" in the short term.
Secondly, the market manipulators are using dual negative data to liquidate and harvest the retail investors, which is a common practice in a bull market, as most retail investors' holdings are not easily moved, only the more speculative positions are easily harvested by the market!
The reason for the back-and-forth liquidation is that there are too many contract positions, causing the bull market to rise slowly. The possibility of continuing to drop sharply this time is very small.
This sudden drop will also be accompanied by a rapid rise, presenting a good opportunity for bottom fishing!
Blindly going solo will never bring opportunities; follow Brother Chao, and I will guide you to explore tenfold potential coins! Top-tier primary resources!
