The recent drop in cryptocurrency markets was not random but came as a result of a clear macroeconomic factor driven by Japan.
🏦 Anticipated decision from the Bank of Japan
The Bank of Japan is scheduled to hold its meeting on the 18th-19th, with strong expectations of raising the interest rate to 0.75%, a move considered the highest in more than three decades.
Markets are pricing in this decision at nearly 98%, making it almost certain.
💱 The fundamental impact: collapse of the Yen Carry Trade
For years, large investors have relied on borrowing in low-interest Japanese yen and then directing this liquidity into higher-yielding assets, such as stocks and cryptocurrencies.
Raising interest means:
Increased borrowing costs
Decline in the viability of this strategy
Acceleration of positions unwinding and debt repayment
📉 Why were cryptocurrencies strongly affected?
Cryptocurrencies are classified as high-risk assets, and with liquidity shrinking:
Investors are liquidating their positions
Liquidity is turning into cash
Selling pressure on the market is increasing
⚠️ Is this a collapse of confidence?
No.
What is happening is a repricing of risks due to tightening liquidity, not a fundamental change in market fundamentals.
🧠 What should the trader do?
Avoid random entry during the drop
Do not try to catch the bottom without confirmation signals
Focus on risk management and capital protection
🎯 Summary
The tightening of Japanese monetary policy is a short to medium-term pressure factor on high-risk markets.
Real opportunities often appear after market stabilization, not during panic.
Patience and discipline always precede profit.
#bitcoin #BTC #BankOfJapan #BoJ #etf
