On August 23, 2024, Federal Reserve Chairman Powell officially announced at the Jackson Hole Global Central Bank Annual Meeting that "Now is the time to adjust policy. The timing and pace of interest rate cuts will depend on incoming data.
If the macro data is not unexpected, the first interest rate cut will be ushered in at the interest rate meeting on September 19. However, entering the early stage of the interest rate cut cycle does not mean that a surge will come immediately. There are still some risks that deserve everyone's attention. Therefore, the author summarizes some of the most important issues at present, hoping to help everyone avoid some risks.
A rate cut does not necessarily mean an immediate rise in risk markets, on the contrary, it usually means a fall.
1. Increased volatility in financial markets
2. Inflation risk
3. Capital outflow and currency depreciation
4. Financial system instability
5. The effectiveness of policy tools is limited
If you ask me if the cryptocurrency market is in a bull market now, I will tell you that it is not a bull market now.
1. The trading volume in the cryptocurrency circle has been sluggish in the past few months, and the sentiment has been at a low point due to repeated washes.
2. Any rise is accidental and unsustainable. This is obviously not a bull market.
3. The overall environment of the financial market is actually not good. In addition to the fact that the seven sisters of the US stock market have stopped their blood-sucking surge, Japan is now raising interest rates, and the game of carry trade in the yen can no longer be played.
1. Institutions are no longer promoting ETFs as vigorously as they did at the beginning of the year, and the cryptocurrency circle has lost its main driving force.
2. The big pie in the cryptocurrency world is no longer going to last. Whether it is inscriptions or AI, these have become a thing of the past. Now the stories have been told and the big pie has been drawn, and there is no one and no funds to support the so-called narrative.
3. I think the cryptocurrency market may see a surge in September, but it will not last too long. Therefore, those who have made floating profits need to be content and stop when they are ahead. Don’t fail to escape from the highs like in April, and end up suffering losses in the market shakeout in the next few months.
How will the bull market develop in the future?
One thing is certain, the currency market will take advantage of the interest rate cut in September to rise, but it is not known whether it will be a temporary boost or the beginning of a bull market.
My view: There will be a tentative rise before the rate cut in September to recover the price losses. Once the rate cut is finalized, there may be a drop. Because the market was betting on a rate cut in September as early as the beginning of August, the expectation digestion of 40 to 50 days will eventually lead to the situation where all the good news will be exhausted and the bad news will come.
After the interest rate cut and a round of violent cleansing, Bitcoin may be able to restart a new rising cycle. This cycle may last for a relatively long time, but it will also be accompanied by some cleansing and flash crashes. It will not be until the end of the year when the interest rate cut becomes more and more favorable that the market can have a substantial breakthrough.
At the end of this article, it is not ruled out that Bitcoin will maintain a price of 100 million US dollars, Ethereum will break through 5,000 US dollars, Sol will also become the main battlefield, and MeMe will also stand out in this year's bull market!
