The market activity over the past two nights is truly not something an ordinary person should take lightly.
Tonight's candlestick chart is more thrilling than any suspense drama you are following—on one side is the Bank of Japan's long-held, imminent "interest rate hike trump card," and on the other side is the U.S. CPI, a ticking time bomb of inflation nearing its explosion point. If you haven't been monitoring your positions closely, waking up in the early hours could result in your account receiving a "reality education package."
Let’s make it clear: this is not ordinary volatility; it is the eve of a global macro capital migration.
The back-and-forth movement in yesterday's market was not due to unclear direction, but rather institutions testing the waters and warming up. The real factors determining the trend are not in yesterday, but in tonight and tomorrow.
The first bomb is the U.S. CPI at 21:30 tonight.
It is the traffic light for capital.
If inflation continues to decline, the market will immediately bet on the Federal Reserve cutting rates early, the dollar will lose favor, and hot money will flood into high-elasticity assets like cryptocurrencies and stocks. Major cryptocurrencies will move first, and logically sound altcoins will also benefit;
But if the CPI exceeds expectations and is on the high side, the rate cut expectations will instantly cool down, the dollar will revert to being a "safe haven," and funds will retreat from risk assets, leading to a rapid market drop. During such times, it is most unwise to bottom fish based on intuition.
The second bomb is even more hidden and deadly: the Bank of Japan's monetary policy meeting.
Over the past decade, institutions have relied on the low-yield yen for global arbitrage, using almost cost-free money to purchase dollar assets, stocks, and cryptocurrencies; this is the dark line of liquidity. Once Japan confirms an interest rate hike, borrowing costs will rise, and the yen will strengthen, forcing institutions to sell overseas assets to convert back to yen to repay debts, leading to an immediate tightening of liquidity and a magnification of volatility.
The market activity over the past two days is essentially a "battle of the titans." The main forces will repeatedly push and pull, using the most bizarre movements to wash out emotional chips.
Here’s the most important advice: don’t bet on direction, don’t be a hero, go with the flow; surviving is much more important than correctly predicting a single candlestick. $BTC
