Click to join the internal chat room of Little Pony

US fiscal stimulus and easing expectations triggered a strong market reaction, Bitcoin hits a new high!

Recently, the US Congress passed a massive fiscal stimulus plan, accompanied by an increase in the US debt ceiling and a gradual rise in interest rate cut expectations, resulting in significantly looser market liquidity. Meanwhile, there was a large-scale injection of funds into the Treasury General Account (TGA) of the Trump administration, which released a substantial amount of liquidity and marked the official beginning of a large-scale monetary expansion era. This is reflected in the Bitcoin (BTC) price hitting a historical high, surpassing $110,000. However, during the early morning hours, the market saw a large number of sell orders, combined with observed movements in a wallet holding 80,000 BTC, indicating that there is still some selling pressure in the market. It is noteworthy that these large sell orders were quickly absorbed, demonstrating strong buying power and sufficient capital continuation.

After the release of the latest Federal Reserve meeting minutes, US Treasury yields fell significantly, and the consensus shifted towards a rate cut in September, leading mainstream assets into a short squeeze. This indicates that the stimulating effect of interest rate cut expectations on the market even exceeds the actual rate cut actions themselves. The passage of this 'large fiscal stimulus bill' is essentially equivalent to 'opening the water faucet'; whether it is the lifting of the US debt ceiling or the policies of rate cuts and balance sheet expansion, the core is to release more monetary liquidity. The rapid expansion of the money supply will inevitably lead to increased pressure of currency depreciation, and inflation risks are unavoidable.

Not only Bitcoin, but global stock markets and various asset classes are also showing a clear upward trend. The current macro environment is gradually evolving into the stagflation pattern of the 1980s. In anti-inflation strategies, mastering monetary tools is crucial, which is also the fundamental reason why stablecoins and digital assets are popular. Holding digital assets means having potential inflation hedging tools.

The US is expected to release a new round of historically high liquidity in August, and the effects of the monetary policy easing have a certain time lag; currently, market funds have not fully entered, and significant fluctuations are expected in the coming weeks, accompanied by periodic large swings, causing washouts for holders. If we consider the market performance in April of this year as a preliminary warm-up, then the market trends in August-September will become the real battleground. It is recommended that investors gradually position themselves and buy on dips to prepare for future altcoin rallies.

Let's talk about the trend of $ETH

ETH is likely to become the leader among altcoins. Looking at ETH's indicators and moving averages, I believe ETH's current trend is better than others. Previously, it couldn't compare with Bitcoin, but now it should be able to outperform. This position has a high probability of being the starting point for ETH's long bull run, similar to the beginning of BTC in 2023.

I believe in the significant trends indicated by the indicators. The moving average for ETH is very strong; such a moving average will have a big surge. After extreme compression and fluctuations, the initial phase is here, and any subsequent downturns/corrections will be good buying opportunities.

Most people in the market are lagging behind, and emotions and public opinion are often guided by prices rather than real rationality. Currently, ETH itself and various side chains based on ETH are the real technical cornerstones supporting blockchain, including RWA and the recently popular stablecoins, all of which run on the ETH chain. When ETH reaches $4000+ or $5000+, lagging retail investors will realize ETH's value, because people cannot earn money beyond their understanding.

Current altcoins that can be held

PNUT Squirrel continues to soar. Previously, I recommended a strategy to buy at 0.2 as a long-term hold. I believe PNUT will be the second PEPE; currently, this trend is becoming clearer. Each generation has its legendary tokens, and this generation's play is undoubtedly the MEME track. Previous cycles saw DOGE and SHIB, last cycle saw PEPE, last year's WIF and BOME, and this year's PNUT, MOODENG, and NEIRO. PNUT is expected to be the hot meme for this wave. Musk has completely shattered the ceiling for peanuts, stating that squirrels and meme coins have saved America. Following this narrative, the ceiling for squirrels 🐿️ has been lifted again, and a fully diluted valuation of 1 billion+ is not unreasonable. I selected long-term coins for everyone; BTC and ETH don’t need further explanation. Other altcoins include SUI, ENS, and PNUT. Currently, SUI's performance is the strongest, ENS is average, and this position is also profitable. PNUT's performance is also quite good. The same viewpoint remains: not every altcoin can be held long-term; many altcoins will lead to losses if held long-term. Therefore, choices need to be made carefully, and I help everyone choose the right coins, ensuring a relatively stable selection.

Click to join the internal chat room of Little Pony