The United States released non-farm data last night. The expectation was 175,000, but the actual number was 114,000. This is definitely good news for the cryptocurrency world. A rate cut in September is almost certain. So why did the market take a sharp turn for the worse? Let me share my humble opinion.
This is mainly because this round of US dollar interest rate cuts has been delayed for too long. The market actually expected the first interest rate cut to be in 2023. Later in June, it was postponed to September. Expectations have been used time and time again to provoke the nerves of the global market. To put it in an analogy, it is like hanging a carrot in front of a donkey, which you can see but cannot reach.
The expectation of interest rate cut has already entered the market, and everyone has been chasing this elusive carrot. Now the carrot is right in front of us and can be eaten soon. The good news is about to be realized, and the capital market has begun to rush forward, including the U.S. stock market, which has seen a gradually obvious correction in the long bull market. U.S. stock holdings have also shrunk significantly in recent days.
But! Here comes the point!
The decline due to the realization of good news does not mean that there will be no fun in the future. The U.S. stock market will collapse, and Bitcoin will return to zero again. From the perspective of economic laws, this correction is also inevitable. Even if there is no decline before the interest rate cut, there will be a decline after the interest rate cut, and the decline should be far more than the current level.
Looking back, the US dollar interest rate cut has brought real benefits to the liquidity easing in the capital market. With less money in banks, hot money has to find somewhere to go, and the places it can go to are nothing more than the stock market, currency market, gold and other places.
Just treat it as a large technical correction, keep enough funds, and wait for the opportunity to slowly move out. Even if your cost is 72,000 for BTC spot, you cannot get it. If you really want to play with the contract, just play with a small position.
This is just my humble opinion. Whether it is right or wrong, I will leave it to time to verify. Have a nice weekend!
