Don’t
call it a drop when it falls
call it a rise when it rises
Being bullish or bearish in the future requires data theory support, rather than using the K-line that has already come out to predict the next market, which is ridiculous.
The most important factor affecting the trend of currency prices is
liquidity
In the last bull market, BTC reached its peak in mid-December, and altcoins reached their peak in March,
and the Fed’s interest rate hike began in March.
The interest rate hike leads to a loss of liquidity in the financial market. In layman’s terms, the interest rate hike leads to a reduction in the US dollar. With fewer US dollars in the market, purchasing power naturally decreases. So the market falls.
After the interest rate hike ended, BTC also bottomed out from 15,400. After the interest rate hike stopped, it rose from 15,400 to 73,000.
And the interest rate cut is to release liquidity, which means that the US dollar will increase in the market, which means an increase in purchasing power.
Example: Yesterday, the Fed reduced the balance sheet reduction quota from 95 billion to 60 billion (equivalent to releasing 25 billion US dollars of liquidity every month), and the market immediately responded positively, and BTC rebounded from 57,000 to 63,000.
From this example, we can also see the direct impact of liquidity on the fluctuation of currency prices.
Raising interest rates-tightening liquidity-currency price falling
Lowering interest rates-releasing liquidity-currency price rising
At present, this stage belongs to the stage of stopping interest rate hikes and expecting interest rate cuts. This year, the Fed is likely to cut interest rates 1-2 times, and it is expected that interest rates may be cut in September and November.
So, BTC fell from 73,000 to 57,000 and shouted 🐮, is it a mindless call for a fall?
Don't be swayed by emotions, analyze based on data and logic.
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