Wow! Today's market is really "turbulent", whether it's the U.S. stock market or the crypto world, everything has been turned upside down! Such a level of volatility surely hides many stories behind it.
Let's break it down and see what caused this big drop and how we should face it moving forward.
Why the big drop?
1. Chinese AI companies ignite global risk sentiment
This morning, Chinese AI startup DeepSeek announced its world-leading R1 model, instantly attracting a large amount of capital back to the Asian market. U.S. tech stocks became the victims, especially companies like NVIDIA and Microsoft that focus on AI, with market values evaporating by more than 6%, directly collapsing the entire tech sector.
2. U.S. Treasury yields soar
The Federal Reserve hinted this week that it might maintain high interest rates for a longer period, leading U.S. Treasury yields to hit new highs. High interest rates compress the valuation space for tech stocks and risk assets, and Bitcoin was also affected, briefly falling below key support levels.
3. Liquidation effects in the crypto market amplify volatility
According to Coinglass data, in the past 24 hours, the total liquidation amount across the network reached $532 million, causing Bitcoin prices to plummet by 5.5%, with ETH and Solana also not spared, becoming the hardest-hit areas in today’s downturn.
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What’s the strategy moving forward?
1. Market sentiment adjustment period, don’t rush to enter
Current market risk sentiment is extremely high, and there may be continued volatility in the short term. It is advisable to patiently wait for the market to find a new balance before considering entry.
2. Focus on key support levels and capital flow
Bitcoin has strong support in the $85,000 range. If it can stabilize in this range, there is still a chance to retest the pressure level above $90,000.
3. Capture the next wave of opportunity hotspots
AI, ecological public chains (like Solana), and projects with practical application scenarios remain the mainstream focus for long-term attention. Recent institutional positioning trends are worth continuous follow-up by investors.
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Although today's market dropped significantly, in the long run, this may just be a short-term fluctuation. The worst in investing is chasing highs and cutting losses; maintaining rationality and seizing the big direction is key. Brothers, after this storm, there may be new layout opportunities! 🌊
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