In the past couple of days, the issue of Japan's interest rate hike has practically twisted the nerves of the entire crypto circle into a knot! Just a few days ago, I discussed with everyone that, logically speaking, this should have a limited short-term impact on market prices—after all, the mainstream digital asset we are focusing on occupies such a small proportion in the global financial market that, to put it bluntly, it can't stir up much of a wave compared to the pearls in our milk tea.
But the slap in the face came faster than the market reversal! When I was reviewing the data yesterday, I was stunned to see the search popularity of the keywords 'Japan interest rate hike' skyrocketing to the peak level of the past decade! It's worth noting that during the three rate hikes in 2024, the market was only symbolically tense, and the search volume didn't even reach a fraction of this time. What does this indicate? The current market sentiment is as sensitive as a frayed cat; even a slight breeze can cause panic. Whether it's seasoned investors or newcomers, everyone is frantically scouring for related news, fearing they might miss a critical signal.
As a veteran who has been immersed in this market for many years, I must analyze historical data to find patterns. It turns out there's something interesting: looking back at the three interest rate hikes in Japan in 2024, after each announcement, the market prices dropped to varying degrees for a period of time. Of course, I must say objectively that there were also other news influences during this period, so we can't attribute all the declines to Japan's interest rate hikes, but as an important macro variable, its impact on market capital flows cannot be ignored.
More crucially, the industry generally predicts that the probability of Japan directly starting interest rate hikes this time is already infinitely close to one hundred percent; in simple terms, it's a 'done deal', with the only difference being which specific day it will be officially announced. Considering the current market's panic sentiment, my personal view is: in the short term, the market is likely to experience some pullback pressure due to this sentiment combined with historical trends. But let's not panic too much, after all, the volatility brought by emotions is often short-term; what truly determines the long-term direction of the market are the global macroeconomic environment, the implementation of industry regulatory policies, and the movements of those 'big players' holding a lot of chips.
Speaking of regulation, the recent actions by the SEC in the US to promote innovative regulation in the industry are also worth paying close attention to, as this could likely bring new development opportunities to the industry; moreover, the position changes of those 'big players' are an important reference for us to judge market direction, after all, their every move could trigger a chain reaction in the market.
Finally, let me say something heartfelt: the market is never short of opportunities, but what is lacking is the ability to remain calm in times of panic and maintain a rational mindset in times of frenzy. How big of a storm will this Japanese interest rate hike cause? Will the market show unexpected trends afterwards? I will keep an eye on real-time data and news and share my exclusive insights with you at the first opportunity. If you find my analysis somewhat reasonable, hurry up and follow me so you don’t get lost! Do you think the market will replicate the previous downward trend this time?
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