Why do we say that bulls are invincible?
With a rebound yesterday, long positions doubled directly, which gave the Air Force some more fuel. For now, we are still focusing on the 50,000-53,000 area. We don’t want to operate unless it reaches this range.
When there is no money-making effect, or when you cannot make money or even lose money, it is not your problem, but must be a problem with the market. When there is a problem with the market, take a rest and wait for the market!
As the Federal Reserve's September interest rate meeting approaches, the market is panicking due to expectations of rate cuts, bearish sentiment is prevalent, and short orders have surged.
The Chicago Futures Market predicts that the probability of the Fed cutting interest rates in September is 100%, of which 55% may cut interest rates by 25bp, 45% may cut interest rates by 50bp, and the total rate cut for the whole year may be 100bp. The market is worried that the theory of rate cut collapse is beginning to spread, and some voices even believe that the Fed will mess up and the dollar hegemony will end. This theory of quick victory is obviously too optimistic.
Historically, the Fed’s several rate cuts have been accompanied by declines in U.S. stocks, including the Internet bubble in 2000, the subprime mortgage crisis in 2007, the 2020 epidemic, and the recent rate hike cycle. In these events, the impact of rate cuts on the market is often accompanied by a rebound in U.S. stocks, but the timing and intensity vary.
Currently, zero-interest assets such as Bitcoin and gold have shown a hedging effect on real interest rates. When the real interest rate is negative, zero-interest assets tend to rise, thereby pushing risk assets higher. In the future, if the Fed continues to cut interest rates, the trend of assets such as gold will affect the effect of the rate cut, and thus determine the direction of the market.
The Federal Reserve may have to make a choice between "soft landing + dollar depreciation" and "strong dollar + hard landing", and the rise of Bitcoin and gold may be foreshadowing the decline of the US dollar.
That’s all for today’s article. We are currently in a bull market, and things are turbulent. We share passwords every day.
