August 1, 2024 Grandpa clocks in
At 2 a.m., the Federal Reserve announced its latest interest rate decision, maintaining the 5.25-5.5% unchanged, continuing the high interest rate operation, which is in line with market expectations. According to the information released by Powell at the press conference after the meeting, the probability of interest rate cuts starting in September is very high. He said that if inflation slows down, interest rate cuts may be implemented as early as September. Powell's dovish voice, coupled with the market's original expectation of interest rate cuts starting in September, the U.S. stock market performed strongly, and the three major stock indexes all achieved different degrees of increase. However, the B circle did not rise but fell, and had an independent market trend. So far, the big cake has still not recovered 65,000 points.
This wave of decline in Bitcoin is within my expectations. Although it has not fallen to 60,000 yet, if this weak trend is maintained, the price is bound to fall further. Therefore, this wave of decline is caused by the market conditions within the industry. It can be said that if it were not for Bao’s dovish remarks, the price would be lower. Judging from the performance of US stocks, the market has a positive expectation for interest rate cuts, and from the law of economic operation, interest rate cuts inject a lot of liquidity into the market, which is also the source of the rise in risk asset prices.
However, I always think that we should pay more attention to this window period when the interest rate cut is about to happen. Often before the good news is released, the market will fully ferment and push up asset prices. In the long run, this price may not be high, but there are often better price opportunities. The sudden drop in US stocks a while ago is a signal that funds are avoiding risks. Therefore, when the big cake tried to break through 70,000, I also clearly informed: only reduce positions, not increase positions. In the short term, we have avoided this wave of risks, and whether there will be greater risks next needs further observation.
As for the market, the short-term market fell after the good news, which is a signal of capital flight. Therefore, we should pay attention to the support level of Bitcoin and Ethereum. The lower support of Bitcoin is 60,000 and 55,000 respectively, and that of Ethereum is around 3,000. I suggest that you continue to wait and see for the funds that have been waved out before. It may not hit the second support, but the probability of the first support is relatively high. Of course, we must also make it clear that the interest rate cut cycle is coming, and our primary goal is to collect chips. The purpose of waiting for another wave of decline is also to get more chips. If you are afraid of flying operations, hold the spot firmly and wait patiently for the big bull market next year.
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