The backstage was asked explosively, 'Why did the market suddenly surge?' One sentence pierces the core: The expectation of the Federal Reserve's interest rate cut ignites a liquidity frenzy. This wave of increase is clearly a textbook-level 'buy the expectation' market! Below, we break down 4 core logics to help you understand the market and seize subsequent opportunities 👇
1. Countdown to interest rate cuts! 'Buy the expectation' is a financial iron law, and it's no surprise that institutions are preemptively accumulating shares.
At dawn on Thursday, the Federal Reserve's interest rate cut is already a done deal — CME FedWatch data shows a 95% probability of a rate cut. A recent report from Bank of America directly points out: The market no longer believes in 'hawkish rate cuts.' The current moment is the golden window for 'buying the rumor, selling the fact'!
Some time ago, BTC dropped to over 80,000, essentially because funds were digesting 'uncertainty' in advance, and now there are only 48 hours left until the rate cut, institutions will never wait for the shoe to drop before taking action. Behind this is the classic liquidity premium theory: rate cuts will reduce the cost of holding funds, and BTC, as a risk asset with no yield, will see its attractiveness increase exponentially (refer to the historical pattern of BTC rising from 5,000 to 69,000 after the rate cut in 2020). Just like grabbing New Year goods, early layout locks in profits, and this wave of institutional buying is cashing in on the rate cut dividends in advance!
2. US stock linkage + risk preference resonance, BTC follows the 'big brother' to sip soup
Stop saying the crypto market has an independent market now! BTC is already a core node of global risk assets, with a correlation to US stocks exceeding 0.7. Tonight, US stocks opened low and rose high, with the S&P 500 soaring, essentially indicating that market risk preference is off the charts — and institutional funds are managed uniformly, while US stocks attract capital, inevitably driving BTC and other risk assets to rise.
This is the cross-market liquidity siphoning effect: when traditional financial markets release optimistic signals, funds flow from low-yield assets to high-elasticity markets, and BTC, as the leader in the crypto space, naturally becomes the first choice for funds. Simply put: US stocks feast, BTC at least gets to drink thick meat soup!
3. Key bombshell explodes! The 'shadow Federal Reserve Chairman' declares: significant rate cuts are possible!
The most significant catalyst tonight is the statement from Hassert, a popular candidate for the next Federal Reserve Chairman — clearly stating that 'the Federal Reserve has ample space for significant rate cuts, even exceeding 25 basis points'!
This is not just an ordinary official's offhand remark: Hassert, as a core candidate supported by Trump, directly represents the future direction of monetary policy. Bank of America analysis indicates that this statement is equivalent to injecting a 'super reassurance pill' into the market, completely dispelling investors' concerns about 'rate cuts falling short of expectations', leading to a frenzy of funds pouring into risk assets. The crypto space, as a market sensitive to policy, votes with its feet and directly buys BTC!
4. The bull market created by piled-up funds! The liquidity big gift package is on the way, and the upward trend has just begun
The essence of the market is driven by funds, and how abundant is the current market liquidity? The data speaks:
The amount of BTC open contracts surged by 12% compared to the previous period, with institutional speculation activity soaring;
The Federal Reserve is about to launch the RMPs plan, buying 45 billion dollars in treasury bonds every month, which is equivalent to sending a liquidity big gift package to the market;
The funding rate for perpetual contracts remains in the positive range, with long positions dominating absolutely, and without excessive leveraged bubbles, the upward trend is more sustainable!
When massive funds aim at the 'rate cut benefit' as a certain opportunity, the rise of BTC is a natural outcome — just like a reservoir filled with water, once the gate is opened, the flood will inevitably rush out!
📝 Live trading showcase! Bottomed at 90,000 + added at 90,400, fully loaded to 94,555 and secured the profit!
Saying too much is not as good as practical action: This morning, I called for a long position near 90,000 in the community, and in the afternoon, I added to the position at 90,400, aiming directly for 94,000, and the result soared to a high of 94,555 in the evening, making a direct profit of 4,000+ points!
It's not that I'm amazing, but the market is too clear — when the three major factors of rate cut expectations, capital inflow, and news catalysts are met simultaneously, this is the 'money-picking market'! Brothers who follow the rhythm have all profited, and those who missed out shouldn't panic, there are still opportunities ahead!
🔮 Future market prediction: After the rate cut is implemented, how high can BTC go?
Combining theory and data, I give everyone two core judgments:
Short term (1-2 weeks): Before the rate cut is implemented, funds will still speculate on expectations, and BTC is expected to challenge the range of 96,000 - 98,000! Bank of America predicts that the 10-year US Treasury yield will fall below 4%, further benefiting risk assets;
Medium to long term (3-6 months): If Hassert successfully takes over as Federal Reserve Chairman, the 'significant rate cut' cycle will begin, coupled with next year's halving expectations, BTC is expected to break through previous highs, reaching the range of 120,000 - 150,000! But be cautious of the short-term correction risk of 'buy the expectation, sell the fact', as there may be a 5%-8% fluctuation after the rate cut is implemented;
Operational strategy: Short positions can rely on the support level of 93,000 for low purchases, with a stop-loss at 92,000; for medium to long term, it is recommended to build positions in batches, as a pullback to the 88,000 - 90,000 range is an excellent opportunity to get on board, hold onto your chips and wait for the liquidity dividends!
Finally, let me say something straightforward:
Making money in the crypto space has never relied on luck, but on sensitivity to macro policies and execution power. Now that the Federal Reserve's rate cut cycle has begun, the wave of liquidity easing will only become more intense, and BTC, as the leader of crypto assets, is bound to be one of the biggest beneficiaries!
Next, I will continue to closely monitor the rate cut decision and capital flow, and will announce new layout opportunities in the community at the first time. Those who haven't gotten on board, hurry up and follow the rhythm, don't miss this wave of certain market!
👉 Let's chat in the comments: Do you think BTC can reach 100,000 next? Will there be a correction after this rate cut?
