Source: Talk Li Talk Outside
Yesterday (US Eastern Time, March 10), the US stock market continued to suffer heavy losses after the opening, with the Nasdaq falling 4% and the S&P 500 falling 2.7%... as shown in the image below. Tech giants such as Tesla, Nvidia, and Apple have all experienced varying degrees of decline, with Tesla being the worst, falling more than 15%. Since reaching a record high of $479.86 on December 17, 2024, Tesla's stock price has now been halved, with its market value directly evaporating by more than $800 billion. Moreover, the X platform was also attacked yesterday, resulting in a shutdown and paralysis, so it seems that the old horse's recent days have not been easy either.
Of course, the Altcoin market is not doing well either. Affected by the overall market sentiment and environment, today (Beijing time, March 11) BTC fell to around $77,000, and ETH directly broke below the $2,000 whole number mark, reaching a low of around $1,800. As of the time of writing, the price of BTC is $79,000, and ETH is still hovering around $1,800.
In the past 24 hours alone, more than 330,000 people have been liquidated, with a total liquidation amount of $940 million, of which $742 million were long positions and $198 million were short positions.
From a direct perception, it seems that more and more people have lost confidence and patience in the market, and we are now in a new level of extreme fear since the relative low point of the previous bear market, and the bear market atmosphere is further enveloping everyone...
1. Is Trump deliberately causing a recession?
Recently, there is an opinion circulating on the internet that Trump is deliberately causing a recession by doing so many things. It's unclear how many people hold this view.
In fact, we have mentioned Trump's topic in many previous articles. As a successful businessman, Trump seems to be running the US like his own company.
So, how can one quickly become a great US president? The simplest way seems to be "printing money" to make the US dollar "great" again.
And the easiest path to achieve this seems to be to play with "debt". Under this premise, the things that can be done are obvious, such as using tariffs, layoffs (what Musk's government efficiency department is currently doing), and other measures to exacerbate economic difficulties and recessions, and force the Federal Reserve to take direct action.
The recent market has made some people think of the circuit breaker event 5 years ago. After the circuit breaker event in 2020, the Federal Reserve launched unlimited QE, and the US government passed a massive stimulus bill. Subsequently, due to concerns about liquidity, the market began to rebound strongly.
Here, we make a more intuitive assumption (note that this is just an assumption): If the US stock market continues to plummet like this and experiences some extreme situations similar to the circuit breaker event during the COVID-19 period in 2020, will history repeat itself?
We currently cannot see the answer to this question, nor is it easy to speculate. For the US, there are both opportunities and costs involved.
Of course, the above statements are just a fantasy. The short-term market trend is impossible to accurately predict. But one thing worth thinking about is: Trump may become the catalyst for a new and larger bear market, and at the same time, he may also become the catalyst for a new and larger bull market. This is a question of different perspectives.
2. Buy the dips or cut losses during the crash?
I found that the friends in the group have started to discuss the market situation enthusiastically again today, and the atmosphere of discussion has become better due to the crash, compared to the calmness of the previous few days.
However, the opinions are different. Some friends have already turned bearish, some are still holding a neutral stance, and some are continuing to buy in batches...
I remember that in the past, whenever the market experienced a major crash, I would often receive messages in the background, asking whether to cut losses/reallocate or buy the dips. But recently, there is an interesting phenomenon - no matter how the market crashes, the messages I see in the background are becoming less and less. It seems that people don't want to actively ask such questions anymore. Is it because they have taken losses and withdrawn from the market? Or have they become numb to the crashes? Or have they successfully escaped the top?
At the same time, another interesting phenomenon is that the average reading volume of the Talk Li Talk Outside articles has not decreased compared to the previous articles, and there are even some new friends (new followers) leaving messages asking basic questions like how to use a VPN, how to use exchanges, and how to buy spot, etc.
Based on these relatively "one-sided" personal experiences, the pessimism or withdrawal of some old investors may be more due to the result of continuous position losses, while the entry experience of some new investors may be more due to the recent continuous reporting by mainstream media, such as the White House's Altcoin summit, the US strategic reserve of Bitcoin (it's worth noting that the strategic reserve is currently only at the executive order level, and this strategically significant event is just beginning, which we still believe needs long-term attention. Additionally, it's worth knowing that after Biden took office, he overturned at least 62 executive orders issued during Trump's tenure, so whether the next president will continue to promote the strategic reserve remains to be seen)... These news are now openly reported, unlike the past when Bitcoin was only reported as a tulip mania scam.
But regardless, the problem everyone is facing now is the continued market crash. As for whether to buy the dips or cut losses, there is no clear answer or template for this. It still depends on your own position and risk preference.
The short-term market is impossible to accurately predict. As for myself, I will always maintain a long-term optimistic view, which has been mentioned in previous articles. Regarding the current overall market situation, our suggestions can be summarized as follows:
- For long-term trading
As long as the target (such as BTC, Tesla) is something you are bullish on in the long run, then make patient operations based on your risk preference.
In simple terms, when you decide to make long-term plans on something or a target, you not only need to see or recognize its long-term potential, but also be able to withstand any possible risks (even the risk of it going to zero or bankruptcy) in the present and future. As long as you can do these two things, you can hold it for the long term.
For example, if you still believe that Bitcoin will eventually reach $200,000, then you can continue to add positions in batches (note that it's in batches, not All In). Be willing to do what others don't dare to do, rather than doing what everyone is currently inclined to do.
In fact, without leverage, if you allocate 10% of your total assets into N batches to continuously purchase (DCA) Bitcoin, this long-term investment will most likely become one of your most successful investments in the future, just as we described in our previous articles: the best time to do this was ten years ago, and the next best time is now.
- For short-term trading
It's to strictly follow your own position and risk preference to operate take-profit/stop-loss.
Here is the English translation:For example, in terms of profit-taking, you can customize it by combining technical analysis, macroeconomic factors, market sentiment indicators, and the research results of the corresponding project, but the target should be as reasonable as possible, especially after the market enters a bull market, you must at the same time achieve staged profit-taking, avoid falling into greed and forgetting your own trading discipline. In terms of stop-loss, different people have different psychological tolerance, and there is no fixed standard or template for this. I have also shared my basic operations in previous articles, that is, as long as the Altcoin I hold falls by 20% during the holding period, I will directly stop loss and clear the position.
Of course, to avoid unnecessary controversy, the so-called long-term and short-term may have different definitions for different people, which can only be continuously optimized according to each person's different positions and strategies. But for most ordinary people, my personal suggestion is that you can define the short-term as 1-3 months or 3-6 months as a stage, and don't trade too frequently (such as trading several times a day), unless you also think you are a professional trader who can grasp the market in real time.
So, should you buy the dips or cut your losses now? You can reconsider based on your own position and risk tolerance. Tomorrow is "312", I wonder how many people still remember March 12, 2020, as shown in the figure below (from the evening of March 12 to the morning of March 13, 2020).
3. Finally, let's take a look at what else has been worth paying attention to or interesting in the past few days:
- MicroStrategy's $2.1 billion preferred stock plan
Regarding MicroStrategy (Strategy), we have already published several related articles, such as in last month's article (February 28), we discussed some data comparisons, as shown in the figure below.
And just yesterday (Beijing time, March 10), there was news that MicroStrategy had filed a prospectus to issue $2.1 billion worth of 8.00% perpetual preferred stock (Series A), and the funds raised may continue to be used to purchase more BTC.
This is certainly a positive for BTC (but such positive news seems unable to directly reverse the short-term market trend), but the selling pressure caused by the additional $2.1 billion in issuance has led to a significant drop in MicroStrategy's stock (as well as a drop due to comprehensive factors such as market sentiment).
The Bitcoin that MicroStrategy has bought since last November has now incurred a loss of over $300 million. As shown in the figure below. You laugh at others' madness, and others laugh at your inability to see through it.
- Exchange stablecoins reach an all-time high
Taking Binance as an example, the amount of stablecoins on this exchange has now reached a relatively historical high level. As shown in the figure below.
Are people all holding coins and waiting and managing their finances? In theory, as long as the market can give a clear direction in the future (such as the macroeconomic situation), the new round of phased rally of some coins may be restarted.
That's all for today. The sources of the pictures/data mentioned in the text have been supplemented in the Notion of the article. The above content is just my personal perspective and analysis, and is only for learning and exchange, and does not constitute any investment advice.
