Market Overview: Double Killing of Long and Short Positions and Capital Outflow
The last Federal Reserve interest rate decision of 2025 finally landed early this morning. In line with market expectations, the Federal Reserve announced a rate cut of 25bp, but this became the fuse that triggered a massive market shock.
Although the action is 'dove', the guidance is 'hawk'. The future rate cut path has been significantly adjusted downwards, and the market quickly shifted from excitement to panic. In just 24 hours, the total contract liquidation across the network exceeded $300 million, with 114600 people being liquidated, marking a bloody night of double killing of long and short positions.
Performance of Major Cryptocurrencies
Bitcoin: Wide Fluctuations, Key Position Contention
After the announcement, Bitcoin quickly surged to $94,500, then rapidly retreated to $92,000, with a daily amplitude exceeding $2,500. Although it briefly rebounded above $92,000 in the morning, it subsequently lost momentum and has currently fallen back to the key area of $91,000.
Ethereum: linked to weakness, support under pressure
Ethereum also fluctuates violently, surging to $3,440 in the early morning before sharply retreating to around $3,320. It briefly dipped below the psychological threshold of $3,300 in the early session and is currently seeking support near $3,260, with the overall trend being weak.
Market sentiment and structural factors
Before the resolution, the optimistic expectations of the market quickly turned into profit-taking, compounded by Standard Chartered's downgrade of the Bitcoin price target and the slowdown of ETF fund inflows, which together intensified risk-averse sentiment. Deep-seated market structural issues are highlighted:
Spot demand is weak: net spot buying volume on exchanges continues to be negative, reflecting insufficient actual buying.
High leverage effect: key points gather large leveraged positions, and price reversals can easily trigger chain liquidations, amplifying volatility.
Technical analysis: key positions in the long-short competition
Bitcoin: daily bearish flag and weekly reversal signals coexist
Bearish view: daily chart forms a bearish flag continuation pattern; if it effectively breaks below the flag's lower boundary around $90,000, it may open up downward space.
Bullish signal: a rare 'three-candle drop' pattern appears on the weekly chart, usually indicating a potential trend reversal. Confirmation of this pattern requires subsequent weekly candles to close positively and break through the high of that bullish candle, with key resistance located in the $94,000–$96,000 area.
Overall, Bitcoin's short-term direction will depend on the outcome of the battle between the $90,000 support and the $94,000 resistance.
Ethereum: structural breakdown, returning to linkage
Ethereum's previously relatively strong technical structure has been damaged, repeatedly failing to hold the $3,400 and $3,300 levels, with the daily rebound pattern facing the risk of failure.
Key support: pay attention to the $3,200 area (50-day moving average and previous dense zone); if it fails to hold, it may test $3,050–$3,100.
On-chain data highlights: the reserve ratio of centralized exchanges has dropped to a historical low of 8.7%, indicating limited potential selling pressure, though this advantage may be temporarily overlooked under macro risks.
News analysis: macro and industry dynamics intertwine
Federal Reserve policy: 'hawkish rate cut' tone set
This rate cut is accompanied by cautious guidance on future paths (the dot plot suggests only one rate cut each in 2026 and 2027), and Powell reiterated 'no preset path,' reinforcing expectations for high rates to last longer.
Political factors add uncertainty
U.S. President Trump criticized the rate cut as 'too small,' and discussions about the next Federal Reserve chair candidate also bring policy uncertainty.
Institution's attitude and capital flow direction
Standard Chartered significantly lowered its Bitcoin price target, cutting the 2025 end-of-year forecast from $200,000 to $100,000.
ETF fund differentiation: Bitcoin spot ETF experienced a net outflow of about $60 million in a single day; while Ethereum, SOL, and other ETFs received net inflows, with BlackRock's staked Ethereum ETF attracting $620 million in the first ten days before listing.
Operational strategy: defense-oriented, cautious layout
Bitcoin
Bullish opportunity: if the price finds support in the $89,000–$89,500 range, a small position can be tested, targeting $92,000–$92,500.
Bearish opportunity: if the price rebounds to the $93,000–$93,500 range and encounters resistance, a small position can be attempted, targeting $91,500–$91,000.
Ethereum
Bullish opportunity: if the price finds support in the $3,150–$3,200 range, a small position can be attempted, targeting $3,250–$3,300.
Bearish opportunity: if the price rebounds to the $3,300–$3,350 range and encounters resistance, a small position can be attempted, targeting $3,250–$3,200.
General risk control reminder
Strictly set stop-loss to cope with high volatility market.
Reduce leverage usage to guard against extreme volatility risks.
Adopt a batch building strategy to smooth entry costs.
Market outlook: oscillation digestion, pay attention to signals
Short-term outlook
Market focus will shift from the rate cut itself to digesting expectations of future liquidity tightening. Bitcoin is expected to oscillate in the $90,000–$94,000 range, while Ethereum will test the effectiveness of the $3,300 support. Changes in trading volume will be key to judging whether selling pressure eases.
Medium-term outlook
At the end of the year, tightening liquidity combined with hawkish policy guidance may make it difficult for the market to launch a unilateral trend, likely leading to complex oscillations. Ethereum, due to its staking lockup and structural supply tightening caused by the exchange's inventory hitting a new low, may show relative resilience in the oscillation.
Key observation signals
Key price level competition: will the price break down below $90,000 with volume, or recover $94,000 with volume?
U.S. stock market transmission: as a risk asset barometer, U.S. stock performance will directly impact crypto market sentiment.
Market sentiment indicators: whether liquidation data tends to stabilize reflects whether panic sentiment is being released in stages.
Summary: calmly respond to uncertainties
This market movement is a stress test for traders' risk management and mindset, indicating that even 'good news' may turn due to expectation gaps in a macro-dominated market.
Bitcoin is currently at a critical point in the long-short trend, with daily structure and weekly signals in contradiction, requiring a wait for clear direction. Ethereum, with stronger on-chain fundamentals and capital inflows, may possess certain risk resistance capabilities.
Final reminder:
Respect the trend, strictly adhere to discipline: avoid being swayed by short-term fluctuations, and firmly execute stop-loss.
Pay attention to substantive indicators: reduce excessive reactions to price noise, and focus more on on-chain data, ETF funds, and other indicators that reflect real supply and demand.
Conserve strength and wait patiently: the year-end market is complex, retaining funds to prepare for potential trend opportunities in the future.
Opportunities always exist in the market, but the premise of continuous presence is to do a good job in risk control. Stay calm and make rational decisions.
