In the early hours, Ukraine agreed to the U.S. proposal for a 30-day ceasefire and is also preparing to sign a mineral agreement. Both Canada and the U.S. have taken steps back on tariffs. These good news stimulated both the U.S. stock market and Bitcoin, which even temporarily returned to the $83,700 level. However, the upward momentum ultimately faltered, and it is now hovering around $82,000.
Moreover, the market sentiment is still in a state of panic, and funds are generally flowing out, keeping the market sluggish. Attention should be paid to tonight's U.S. CPI data, as this may be a rare opportunity to break free from losses. As for whether it meets market expectations, just be patient and keep an eye on the trends of the U.S. stock market in the coming days to see if it can stop falling.
Should we 'exit to avoid risks' or 'enter at a low point'?
In the cryptocurrency market, short-term fluctuations are severe, and information noise is rampant, making it easy for investors to lose their direction. Especially during a pullback phase, it is crucial to think calmly and shift focus from the immediate price fluctuations to the larger 'trends' and 'cycles.'
The long-term trend of Bitcoin is shaped by macro factors such as technological innovation, global adoption, institutional entry, and policy evolution. Once this trend is established, it flows like an endless river; even if the road ahead is winding, it is difficult to change its ultimate direction toward the sea.
The short-term cycle is influenced by factors such as market sentiment, macroeconomics, sudden events, and capital flow, much like the waves in a river. Although it appears grand, it is merely a transient phenomenon in the long river of trends. The alternation of bull and bear markets in Bitcoin, as well as the rise and fall of prices, all belong to the realm of cycles.
Therefore, in the face of the current market volatility, investors need to distinguish between 'trends' and 'cycles' to make informed choices between 'avoiding risks' and 'buying the dip.'
Tonight, the U.S. will release CPI price data. If it is lower than last time, market sentiment will be more enthusiastic, and prices may continue to rise. However, it's essential to keep an eye on news from the U.S., especially regarding tariffs and the Russia-Ukraine situation, as well as whether Trump will make any sudden moves. As long as these do not cause chaos, prices should remain stable.
Currently, based on the FOMC rate probabilities, a rate cut in March is definitely not expected. The probability of a rate cut in May is 45%, and in June, it is 93%. If this week's CPI data is favorable, and U.S. government funding can be extended on March 15, then the probability of a rate cut in May will continue to rise. Personally, I hope for a 2.9, which would allow the market to rebound a few thousand points, as it has fallen too sharply recently and needs a rebound to ease the downward market sentiment.
Additionally, focus on tomorrow's PPI and the Federal Reserve meeting on March 20. There will be no interest rate cuts in March; the key will be Powell's speech.
1. How many times are rate cuts planned for this year?
2. Will there be a slowdown or even a halt in the reduction of the balance sheet?
3. What is your view on Trump's tariff policy?
If he says at least two rate cuts this year and talks about slowing down the reduction of the balance sheet, Bitcoin could rise. However, we must avoid any discouraging statements like 'we need to cut rates more because of a potential economic recession.' In short, the more moderate the Fed's stance, the more favorable it is for the market, but we must still keep a close watch on Trump's actions regarding tariffs!
As for how to operate at the moment, many cryptocurrencies are currently showing a predominantly volatile trend. They rise slightly and then immediately pull back, possibly waiting for tonight's CPI data. Those who are more cautious can wait for the data to be released before making any moves.