While the Fed's hawks circle the interest rate tree, the cryptocurrency herd is the first to be taken away—yet the wolves that survive can always gnaw on the fattest bones.
Yesterday, ETH attempted to break the 3880 resistance level several times without success, and the market has shown signs of fatigue. At 8:30 PM, two pieces of U.S. data turned into a 'market meat grinder': Initial Jobless Claims (218,000) indicate a strong job market, and Core PCE Year-on-Year (2.8%) remains stubbornly high like 'an adhesive plaster'. The probability of a rate cut in September has plummeted below 30%! The dollar strengthened instantly, and cryptocurrency funds experienced a net outflow of $3.99 million in a single day, with panic spreading like a virus.
The storm of plummeting prices suddenly started half an hour after the data was released. ETH crashed from 3830, breaking 3650 at 8:50 AM this morning, hitting a low of 3613, just a step away from the psychological defense line of 3600! The bull defense line collapsed instantly, and panic selling surged.
But desperate situations often breed reversals: Just as the 3600 defense line was about to collapse, mysterious funds surged in to buy at the bottom, and ETH rebounded 100 points in a flash! The current price returned to around 3710, with bulls and bears locked in a brief standoff after a bloody battle.
Root of the plummet: Why did these two pieces of data become the 'nuclear button'?
Strong employment + Stubborn inflation = Rate cut dreams shattered:
Initial claims data exceeded expectations, showing that the labor market refuses to cool down. Core PCE remains high at 2.8%, and the inflation indicator most valued by the Fed is 'stubbornly sticky'. The market is completely desperate: a rate cut in September has become a luxury, and the 'higher for longer' interest rate sword hangs ominously.
Dollar's bloodsucking, cryptocurrency's bloodletting:
The collapse of rate cut expectations drove the dollar soaring, and capital quickly fled risk assets; the net outflow of $3.99 million is just the prologue. If the dollar continues to strengthen, the cryptocurrency market will face greater bloodletting pressure.
Weak consumption buries hidden dangers:
Personal consumption month-on-month rate at 0% reveals insufficient internal economic momentum. However, the labor cost index remains high at 0.9%, with shadows of a 'wage-inflation spiral' emerging, and signs of stagflation lurking. Institutions are understandably hesitant.
Technical Breakthrough Point: Keep a close watch on the three critical lifelines.
Bull's Lifeline: The 3680 - 3650 area (today's rebound starting point).
If it fails a second time here, panic will reignite, and 3600 is hard to protect.
Bear's Throat Line: 3750 - 3780 (4H critical resistance level).
If the rebound cannot break through this area, the bears still control the situation.
Trend Reversal Signal: A breakout with volume that stabilizes above 3820.
Only by returning above the previous resistance zone can we declare that panic has been digested, and a short-term bottom has been established.
Future Strategy: There's gold hidden in the panic, but it requires a 'sharp blade mentality'.
Short-term Experts: In the 3650-3680 area, you can take light positions to bet on a rebound, targeting 3750-3780, with strict stop-loss at 3620 (to guard against false rebounds).
Trend Traders: Before breaking 3780, be more observant and act less. If it breaks 3650 again, you can short in line with the trend, targeting below 3600.
Medium to Long-term Investors: Wait for a Weekly Stabilization Signal. Below 3600, you can divide your holdings to buy on the dip, but you must retain sufficient ammunition to guard against extreme market conditions.
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