【BTC Roller Coaster: From 116K to 111K, What Is the Market Playing At?】

Last Friday, a statement from a Federal Reserve official saying "the interest rate cut signal is dovish" ignited the entire market. U.S. stocks soared across the board, and BTC was no exception, jumping to $116,000, pushing investor sentiment to a new high. Everyone was shouting that the bull market had arrived, but just two days later, on Sunday, it crashed back down to $111,000, with hundreds of millions in long positions liquidated, resembling a roller coaster. The question arises, what logic is behind this?

First, it is essential to understand that this surge is fundamentally "expectation-driven." The market is betting on an interest rate cut in September, with liquidity set to increase, causing risk assets to take off early. BTC, being a high-risk, high-elasticity asset, is easily driven up when there is any sign of movement. However, note that this is merely "buying expectations," not "facts materializing." Short-term capital is the smartest: they raise prices to cash out and secure profits.

Secondly, the market liquidity over the weekend is relatively thin, with leveraged funds flooding in, amplifying the market's volatility. When prices turn, leveraged longs are forcibly liquidated, triggering a chain reaction, creating a typical "de-leveraging" effect. Thus, the drop you see is not a sign of a deteriorating trend but rather a compression and adjustment of positions.

Finally, don’t be frightened by short-term fluctuations. From a structural perspective, as long as the support at 110K isn’t breached, BTC remains in a strong upward channel. On a macro level, the logic of interest rate cut expectations and liquidity easing remains unchanged, and the main line of the bull market still stands. Such sharp rises and falls are actually the healthiest form of market reshuffling during a bull market.

So the question is: do you see this pullback as a risk, or do you view it as an opportunity? In my opinion, this is not the end of the bull market, but a deep breath before acceleration.

#BTC #Macro #BullMarketRhythm