In fact, it is important to add that the rebound of Bitcoin started at 4 a.m., when the market began to stimulate buying, and then it fluctuated upward all the way. This also means that around 58,000 has reached the "bottom" in the minds of some people, but is it really the bottom?
In fact, it is hard to say whether it is the bottom, and it is also hard to say whether the rebound can continue. Let’s look at the timeline.
Since the past two weeks, the rise of US stocks has nothing to do with the crypto market. At that time, many bloggers including me have interpreted the problem. Under the global high interest rate, the market lacks liquidity. In fact, the capital market is not lacking, but the liquidity is lacking. In addition, in terms of macroeconomic sentiment, the Federal Reserve has always emphasized the expectation of one interest rate cut this year, which has led to a lack of trading momentum in the market. At the same time, in the US stock market, the strong money-making ability of the AI narrative, coupled with Nvidia's extraordinary money-making effect, has led to the entire Nvidia withdrawing $1 trillion in liquidity funds from the global financial market since May 22. This siphoning, let alone the crypto market, has also sucked away part of the market value of the other six technology giants that are also US stock technology giants.
Looking at the crypto market, Bitcoin began to rebound at 4 a.m., which was the time when the U.S. stock market closed. What happened to the U.S. stock market yesterday? There was a collective decline, the Nasdaq and S&P fell, and Nvidia fell more than 6% in a single day, with a market value of 400 billion U.S. dollars evaporated. The decline in market value is actually due to the fact that some people cashed out and sold stocks, and turned stocks into cash.
After Nvidia led the decline in U.S. stocks, the U.S. stock market closed, and some idle U.S. liquidity funds began to seek more markets, especially profitable funds, and then funds began to flow into the crypto market. At the same time, international gold also rose slightly after 4 a.m. These were all price increases caused by capital buying.
In fact, the inflow of funds from the US stock market into cryptocurrencies and gold is somewhat similar to the effect of Bitcoin profiteers investing their excess funds in altcoins after making money in the bull market. To put it bluntly, they make money and dare to spend and invest. After all, it is earned money, so they have confidence to invest. Therefore, the rebound of the crypto market in the early morning is not unrelated to the decline of US stocks.
Finally, why am I worried that Bitcoin will be weak in the future? It is because Nvidia will inevitably rebound after a sharp one-day drop. At the same time, because of the strong AI narrative and Nvidia's position in the AI field, I believe that the US stock AI and Nvidia's financial market siphoning effect will continue. Apple has also started to use AI. Currently, Nvidia has rebounded 5% and Apple has risen 1.79%.
I am worried that if the stock prices of Nvidia and Apple and their wealth-creating effects become prominent again, funds from the capital and financial markets will still be siphoned away. At that time, the crypto market may only have bullish sentiment but no "live water" to pay for it.
