This morning, Powell stated that the Federal Reserve has no intention of participating in any plans for the government to hoard large amounts of cryptocurrency. Coupled with the Fed's meeting lowering interest rate cut expectations for next year, this has led to a significant drop in cryptocurrencies.
Since standing at 90,000, we have already experienced three rapid declines, and today’s drop counts as the fourth. It can be said that the previous three rapid declines consumed a large amount of buying power, so this time after the rapid decline, we did not see much buying power in the market. Instead, there was a downward trend after a sideways movement, which effectively buried another wave of bottom-fishing funds. Therefore, in the short term, it will be quite difficult to return to a strong position. The overall market enthusiasm was too high recently. If nothing unexpected happens, the market should be completing the most severe cleansing before the rapid rise of altcoins, aided by the knife handed over by Powell.
After the U.S. Federal Reserve's interest rate decision was announced at 3 AM on the 19th, Bitcoin began to enter a downward trend, plummeting from a high of $104,800 to a low of $100,303, with a drop of up to 4.3%. As of the time of writing, it is reported at $98,971, with a nearly 24-hour drop of 5.85%.
In the last 24 hours, $702 million was liquidated.
On the other hand, according to Coinglass data, in the past 24 hours, the total liquidation amount in the cryptocurrency market reached $702 million, with long positions liquidated at $608 million being the majority, and short positions liquidated at $93.57 million, with more than 25,300 people being liquidated.
The super major crash to 20,000 points is still on the way.
The entire altcoin market feeling like it’s going to zero feels very dangerous. Today, the U.S. core index S&P 500 plummeted, marking the worst and most severe drop in 20 years. If it enters a downward channel, all gains in altcoins will revert to zero.
Important Reminder
Caution against risky development, after all, there is no fundamental change in the trend, and the policy is still moving towards monetary easing, although it will be slower. Moreover, the real power of the U.S. election has yet to explode. I am very optimistic about the first month after the power transition on January 20, 2025, and within that month, there will also be the financial reports for the fourth quarter of 2024. The combined effect is definitely a time worth looking forward to.
And before January 20, my personal view is that one can buy quality assets on dips, such as BTC and ETH below the psychologically tolerable price. Everyone has different views on positions, and there is no definite standard. But for me, I am not in a hurry to take action now; I still want to see if there will be an opportunity to act after Christmas. Of course, if there is continued downward expansion, especially if BTC falls below (just hypothetically) $95,000, I will start to build a position.
