Abeeha Naveed

$XRP dropped sharply to $1.88, breaking the psychological $2.00 support during Monday’s market-wide correction. Price is now testing the critical $1.85–$1.90 support, a zone that has held after every major pullback since the November 2024 breakout.

🔻 What’s Happening

XRP lost the $2.00 level and fell out of its month-long $2.00–$2.25 range

Printed a multi-week low at $1.88

Currently hovering around $1.93

⚠️ Bearish Risk Scenario

Ali Martinez: XRP fell below its 1-year range ($1.92–$3.27)

Needs a daily close above $1.92 or risk a 50% drop toward $1.00

Cheds Trading:

Warns of a high-timeframe breakdown

Possible rounding top / double top (M pattern)

A confirmed break below $1.88 could send XRP toward MA200 / ~$1.00

🟢 Bullish Case Still Alive

Trader Niels:

XRP is sweeping the $1.80 liquidity zone

Showing bullish divergence on daily

Break above $2.20 could trigger a 27–37% move toward $2.80–$3.00 within a month

ChartNerd:

Price action mirrors 2023–2024 accumulation

Expects a major markup phase between now and late 2026, similar to Nov 2024

📌 Key Levels to Watch

Support: $1.90 → $1.85 → $1.80

Invalidation / Breakdown: Daily close < $1.88

Bull Confirmation: Daily close > $1.92, strength above $2.20

Upside Targets: $2.20 → $2.80 → $3.00

Downside Risk: $1.50 → $1.00

TL;DR:

XRP is at a critical decision zone. Hold $1.85–$1.90 and reclaim $1.92+ → recovery setup. Lose $1.88 → high probability of a deeper macro pullback.

$XRP $BTC $DOGE

Here’s what it really means in moments like this 👇

🔑 What early winners actually did

People who bought BTC at $100, $1k, or even $10k didn’t:

Time every top and bottom

Panic sell on liquidation cascades

Chase every new shiny narrative

They held conviction during drawdowns when:

News was bearish

Everyone on CT was screaming “it’s over”

Price action looked broken

🧠 Translate that to today

In moments of:

💥 $100M+ liquidations

Fake breakdowns

Macro noise (rates, BOJ, Fed, geopolitics)

The edge is behavioral, not technical.

Ask yourself:

If this is one of those moments people talk about 5 years later…

am I reacting emotionally or positioning rationally?

⚠️ Important nuance (this is NOT blind holding)

CZ’s message does not mean:

Hold trash projects forever

Ignore risk management

Go all-in with leverage

It means:

Hold high-conviction assets

Size positions so volatility doesn’t force you out

Let time do the heavy lifting

🧩 Given your market focus

You already see how:

Liquidity injections

Forced liquidations

Narrative whiplash

…create transfers from weak hands to strong hands.

That’s usually how generational positions are built.

Bottom line

People you were jealous of didn’t have better info.

They had better emotional control in moments exactly like this.

Survive → Stay positioned → Let cycles work.

If you want, I can help you separate “hold through noise” assets from “cut and rotate” ones based on your current watchlist.

Annual ETF sales: ~¥330B

Total ETF book value: ¥37.1T (market value ~¥83T)

Implied unwind timeline: ~112 years

Monthly, steady selling to avoid volatility

Automatic pause if a crisis hits (2008-style shock)

This is not tightening — it’s housekeeping.

Why Markets Shouldn’t Panic

Scale is tiny

¥330B/year is negligible vs Japan’s equity market and global liquidity flows.

Daily Nikkei turnover alone dwarfs this.

BOJ track record

They successfully unwound bank shares over a decade with zero drama.

Same playbook here.

Policy stance remains accommodative

This does NOT replace QE tightening or aggressive rate hikes.

Yield Curve Control normalization is still the bigger lever — and even that is cautious.

What This Means for Risk Assets

📉 Japanese Equities

Neutral to slightly negative long-term

No near-term pressure if selling stays mechanical and predictable

💱 Yen (JPY)

Marginally supportive over years, not months

Not enough to drive a sharp JPY rally alone

🪙 Bitcoin & Crypto

This is the key part for you 👇

No immediate liquidity shock

Slow, pre-announced selling = markets can absorb it

Compared to Fed QT or ECB balance-sheet actions, this is noise

If anything:

The fact BOJ is afraid of volatility reinforces how fragile the system still is

That long-term fragility remains structurally bullish for Bitcoin

Bottom Line

This is optics, not impact

A century-long unwind is basically the BOJ admitting:

“We can’t ever fully exit without breaking something.”

So unless they accelerate the pace or pair this with aggressive rate hikes (unlikely), this is not a bearish catalyst for global risk or crypto.

If you want, I can:

Compare this to Fed QT impact on BTC

Break down why Japan still matters so much for global liquidity

Or map this into your current macro/crypto thesis 📊

For most of 2024–2025, Bitcoin traded like a high-beta tech stock, closely tracking:

Nasdaq

AI-driven equity momentum

Liquidity expansion

That relationship is now breaking down.

As confidence in the AI-led equity rally weakens and liquidity tightens, investors are shifting from growth and speculation → capital preservation. That’s the same psychological shift that drives money into gold.

Bitcoin is increasingly being grouped into that same bucket.

What’s driving the correlation spike specifically

1️⃣ Global risk-off environment

Asian equities are retreating

Tech stocks are selling off

Macro data (China, US jobs) is weakening

In these conditions, assets divide into:

Risk assets (equities, altcoins)

Monetary hedges (gold — and now Bitcoin)

Bitcoin is landing firmly in the second category.

2️⃣ Flight to quality inside crypto

Altcoin dominance collapsed to ~29%

Bitcoin dominance surged to ~58.6%

When fear rises:

Traders exit speculative tokens

Capital consolidates into the most liquid, most trusted asset

Inside crypto, that asset is Bitcoin — just as gold is in traditional markets.

3️⃣ Liquidity has dried up

This is critical.

Inter-exchange BTC flows are at 2018-era lows

Spot volume down 36%

Derivatives volume down ~36%

Market makers are stepping back

Low liquidity + uncertainty = investors stop chasing upside and start protecting value — exactly how gold behaves in stress periods.

4️⃣ Leverage reset, not panic

Liquidations surged (+1,500%) but were mostly longs

Open interest is still rising

Funding is neutral

This signals positioning reset, not capitulation.

Gold often rallies during these “reset phases” — and Bitcoin is now mirroring that behavior.

5️⃣ Institutional perception is changing

The biggest structural shift:

Bitcoin is increasingly viewed as a monetary asset, not a tech proxy.

Evidence:

Strong on-chain supply dynamics

Continued institutional adoption

Bitcoin holding value while altcoins bleed

Correlation with Nasdaq weakening

Correlation with gold strengthening

That’s why the gold correlation hitting +0.93 is such a big deal — it reflects how Bitcoin is being used, not just how it’s priced.

Why this matters going forward

Short term:

Thin liquidity = sharp, unpredictable swings

Below ~$88k → liquidation risk

Above ~$89k → spot buyers may return

Medium term:

If this “digital gold” behavior persists, Bitcoin could:

Decouple from tech stocks

Become less volatile relative to equities

Attract more conservative capital

Big picture:

This is a sign of maturation, not weakness.

Bitcoin looks calm on the surface — but the market structure underneath is fragile because participation is low, not because conviction is gone.

Bottom line

Bitcoin’s record correlation with gold isn’t accidental.

It’s the result of:

Risk-off macro conditions

Liquidity withdrawal

Deleveraging

A flight to quality

And a growing belief that Bitcoin is money, not just momentum

That shift may define the next phase of the cycle.

Nasdaq: −1.7% Friday | −1.5% weekly → tech profit-taking after a strong run

S&P 500: −1% Friday | −0.6% weekly → still hit a record high Thursday

Dow: −0.5% Friday | +1% weekly → rotation into defensives/value

➡️ This already tells us: rotation, not risk-off panic

🏦 1. Trump’s Fed Chair Pick — Why Markets Care

With the 25 bps rate cut done, attention shifts to who replaces Jerome Powell.

Names in focus:

Kevin Hassett → Seen as more dovish, pro-growth, market-friendly

Kevin Warsh → Historically more hawkish, inflation-focused

Market impact:

🟢 Hassett favored → bullish for equities, crypto, risk assets

🔴 Warsh favored → pressure on growth stocks, higher rate expectations

⚠️ Even rumors can move bonds, USD, Nasdaq, and crypto fast.

📉 2. Economic Data Backlog Clears

Delayed data releases now hitting the tape means:

Markets will reprice growth & inflation expectations quickly

Higher volatility around data prints, even if numbers aren’t shocking

Key reaction zones:

Strong data → Nasdaq underperforms, yields up

Soft data → risk assets catch bids, rate-cut expectations expand

💻 3. Tech vs Value Rotation

Nasdaq weakness + Dow strength = institutional rotation, not exit

Watch:

Mega-cap tech support levels

Financials, industrials, energy flows

This fits with a late-cycle bull market, not a top.

🔮 What This Means Going Forward

Macro tone: Still bullish, but choppier

Equities: Buy dips selectively, don’t chase highs

Crypto: Rate-cut tailwind still intact, but headlines = volatility

Risk management: More important than entries this week

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The Federal Reserve’s decision to cut interest rates by 25 basis points in December reinforces its gradual shift toward a more accommodative monetary stance. While the move itself was widely anticipated, accompanying remarks from Chair Jerome Powell suggested that further rate adjustments in 2026 remain firmly on the table.

Powell acknowledged that economic data continue to present a mixed picture, but emphasized the Fed’s willingness to act if inflation moderates further or labor market conditions weaken. Markets interpreted the comments as a signal that softer monetary conditions may lie ahead, supporting risk sentiment across asset classes.

Understanding the Fed’s December Rate Cut

The December move marks the third rate reduction of the year, bringing the federal funds rate to a target range of 5.25%–5.50%. While investors had largely priced in the cut, the Fed’s emphasis on policy flexibility added a note of optimism.

Policymakers reiterated that future decisions will remain data-dependent, closely tracking inflation trends, employment dynamics, and broader economic growth. Analysts view this cautious posture as an effort to preserve room for maneuver while maintaining the Fed’s long-standing commitment to price stability.

Fed Outlook for 2026 and Investor Implications

Looking ahead, updated Fed projections reveal a split among policymakers. Some favor restraint to avoid reigniting inflationary pressures, while others signal openness to more substantial easing should economic momentum falter.

This divergence highlights ongoing uncertainty around the pace and magnitude of future rate cuts. For investors, closely monitoring incoming macro data will be critical, as the Fed’s evolving policy path will continue to shape asset allocation decisions—particularly across equities, fixed income, and cryptocurrencies.

Bottom Line

The Fed’s December rate cut, combined with its forward guidance, points toward a potentially softer monetary environment heading into 2026, though one firmly anchored in economic data rather than pre-committed easing.