On August 24, the cryptocurrency market saw a sharp rise driven by expectations of a rate cut.
This Friday, the Federal Reserve announced that it would start cutting interest rates in September. As soon as the news came out, the market's expectations for rate cuts were instantly released on a large scale. While the U.S. dollar index plummeted, commodities and the cryptocurrency market experienced a surge in prices.
The current market has broken the rhythm of the previous large cycle of sideways trading! Nearly 70% of market participants are bullish on the market.
But in this seemingly hot situation, there are several key details that deserve everyone's attention.
First, the current market is mainly in the stage of anticipating a rate cut, and the focus of subsequent attention is on whether the rate cut will be 25 basis points or 50 basis points. However, the market has digested some of the sentiment, and the subsequent impact is relatively limited. The key is that the Fed gave a time signal for a rate cut in September, which triggered a strong reaction from the market.
Second, there may be three trends in the future. The first is that the interest rate is really cut in September, but the expectation has been released at this time, the currency price may not continue to rise, and the US dollar may not fall; the second is that the Federal Reserve unexpectedly does not cut interest rates, which will undoubtedly bring a huge impact to the market; the third is a continuous trend, that is, after the interest rate cut in September, the US dollar continues to fall and the currency price continues to rise. Which trend will be presented depends on the market trend space in the transition period from now to September, and this space will determine how the interest rate cut in September is handled in detail.
In general, the Fed's announcement of a rate cut last night has caused market expectations to explode, which is undoubtedly a cruel test for those who trade unilaterally in the market. In this special period, everyone must not be overly confident. The risk of betting on one side is very high at this time. We should look at market changes rationally and avoid blindly pursuing emotional market effects.
From a technical perspective, Bitcoin broke through the top range support band overnight, but fell back quickly this morning, and the short-term long and short competition is fierce. For this emotional market unilateral trend stimulated by news, investors need to pay close attention to the gains and losses of the 10-day moving average. Once the big negative line loses the 10-day moving average, the unilateral upward trend may end, and there is a risk of a rapid decline. The current upper resistance level is around 65,700, the high point of the previous trend channel's counter-pressure decline, which is basically approaching. The next stage will be a fierce competition between long and short sides. For the operation of Bitcoin and Ethereum next week, investors should remain highly vigilant and make decisions prudently based on market trends and key indicators.
The current market can be analyzed according to today's strategy:
64300-64500 short position, first look at 63000
