🚨🚨🚨 HERE is WHY The MARKET Is DOWN 😱
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On 5 August, financial markets saw a mass sell off of assets, ranging from stocks to precious metals. The VIX volatility index, also known as the Fear and Greed Index, jumped to its highest point since the coronavirus pandemic.
There were two primary reasons for this. The first is that Japan raised its key interest rate to 0.25% for the first time since 2006, which resulted in carry trades losing their previous appeal. The strategy for this kind of trade was to take out loans in Japanese yen at near-zero interest rates and exchange the yen for US dollars to buy US stocks and bonds. The increased interest rate made loans more expensive and strengthened the yen. After this, carry traders began liquidating their positions.
The second reason was that falling tech sector returns and disappointing US economic data for July led to a reassessment of risks. The Sahm Rule, developed by former Federal Reserve and White House economist Claudia Sahm, exceeded the crucial 0.5% threshold. Historically, this indicator has been surprisingly accurate at predicting economic downturns.
As such, the future movement of Bitcoin and Ethereum largely depends on investors' resistance to panic attacks. US spot ETFs, a key driver in 2024, have seen an outflow of $406 million in the past two days. However, that's far from the record-high seen on 1 May, when the indicator hit $564 million.
🚨 The dip time is usually the best time to buy. Maybe the coin is just pulling the strings and you know…as the saying goes, " it always shines after the dark" . So, if it’s dip time, then it is buying time.
Regardless of what caused the dip in price, there always exists a chance for a recovery, especially in the crypto space… Impossible is just a word thrown around for no reason. No matter how bad a project dipped, it could turn its fortunes around if the right moves are made.
