Hey, so here’s what’s going on with the crypto market today.
– Morning (8-10 AM) → Expect a dip (red). No need to panic, it’s a normal reaction plus some influence from China’s central bank.
– Late morning to afternoon (11 AM – 3 PM) → We should see some recovery (green) since Japan’s GDP is up. More growth means more inflation concerns, which tends to push markets up.
– Afternoon (4-6 PM) → Another dip (red) as stock markets close.
– Evening (7-10 PM) → Likely a bounce back (green) when the U.S. JOLTS job data drops.
– Late night (10 PM – midnight) → Another dip (red) as big players (market makers) start moving things around.
– Overnight (1-8 AM) → Likely green again because of reduced Fed liquidity (RRP). But expect another dip when stock markets close.
During Biden’s presidency, economic data often looked better than expected, making it seem like there was no recession. Job reports showed a lot of part-time jobs, and employment numbers always looked solid. So they used to bet against the data (inverse trading), and it worked well.
But during Trump’s presidency, the data consistently looked bad, so they stopped trading against it. But they later discovered that a key employment index (CB Employment Index) was being adjusted downward. That’s when they realized Trump was likely making the numbers look worse to justify cutting interest rates, which the Fed resisted.
At the core, this is a battle between Trump and the Fed. Trump wants more liquidity (more money in the market), but the Fed is keeping things tight. That affects stocks and crypto big time.
What about Japan? Japan’s GDP growth slowed to 2.2% (down from the expected 2.8%). This weakened the Yen, which affects something called the “carry trade.” Carry trade is when investors borrow money in a country with low interest rates (like Japan) and invest it in countries with higher rates. Japan’s high debt-to-GDP ratio (260%) is allowed because of this system. But if the Yen weakens too much (like at 145 Yen per dollar), it disrupts this trade.
Meanwhile, in China: The PBOC (China’s central bank) is slowly draining liquidity from the market. They’re doing it in small amounts, which isn’t causing major shocks yet.
A Goldman Sachs analyst pointed out that Trump’s recent interview didn’t reassure investors. If anything, it made things worse. Money is still flowing out of the market, and investors don’t feel safe jumping back in yet. The government could even shut down on Friday if things go south. That would add even more uncertainty.
Markets are choppy, but some believe we’re near the bottom.
And here’s a fun quote from Binance’s CEO, CZ: He says, “People think buying Bitcoin early was just luck, but they don’t realize how much pain early holders went through.” Holding crypto isn’t easy, especially when the market is volatile. The advice here is: Don’t go all-in. Only use money you can afford to lose, and follow the 1:3 rule for big investments (1 part risky, 3 parts safe).
The market is a mix of ups and downs today, influenced by global economic data, central bank actions, and political drama. It’s a reminder that investing isn’t easy, and patience is key. Stay cautious, don’t over-leverage, and always keep an eye on the bigger picture.
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