Bitwise's research head Jeff Park pointed out that the market is currently experiencing the fastest Bit drop in Bit history, with violent price fluctuations in a short period of time, causing panic among many investors. However, for experienced investors, this often means that buy the dips opportunities are emerging.
He believes that this Bit retracement is similar to the correction in US tech stocks in the past. For example, Tesla (TSLA) stock price once fell more than 50% in the short term, which was a significant loss for institutional investors, but in the long run, it became a good opportunity to buy the dips.
Global Liquidity Rebounds, Bit to Become the "Fastest Horse"
Park further analyzed that global market liquidity is improving, which is a strong support for risk assets. He pointed out that the US 10-year Treasury yield has declined, and M2 (broad money supply) also has an upward trend, which will drive capital to flow back into the market.
Park described that in this market adjustment, Bit is like a "tax-free fast horse" that can quickly respond to market changes and become the leader of the rebound. He said:
Bit has always been one of the most liquidity-sensitive assets in the market, and it is usually the best-performing target when liquidity is loose.
In addition, the recent launch of Bit ETF options has provided the market with an unprecedented regulated leverage mechanism. Unlike traditional leverage, these options will not directly affect the currency value, but will increase the speed of market capital flow, which is a big positive for investors who want to use leverage to operate.
Is the US Stock Market Unwell? Morgan Stanley's Investment Chief Warns of a Potential 20% Plunge
In contrast to the optimistic expectations for the cryptocurrency market, Morgan Stanley's investment chief Mike Wilson has issued a warning about the outlook for the US stock market. He predicts that the S&P 500 index may fall another 5% in the short term, and if the market environment deteriorates, it could plummet by as much as 20% at worst.
According to a Bloomberg report, Wilson believes that US companies are facing earnings pressure, coupled with uncertainty over tariff policies and a reduction in government fiscal spending, causing market confidence to waver. He forecasts that the S&P 500 index may drop to 5,500 points in the first half of the year, and may not have the opportunity to rebound to 6,500 points until the end of the year, with the market still experiencing volatility in the short term.
In addition, the large-cap tech stocks that have driven the US stock market rally in the past two years are currently facing the pressure of overvaluation, and investors are starting to shift to other markets, causing the recent underperformance of the US stock market compared to international stock markets. The Trump administration's trade policy also has constant variables, further exacerbating market uncertainty.
US Economic Data Remains Stable, Inflation Not Expected to Spiral Out of Control
Although the market is full of uncertainty, some economic data still show that the US economic fundamentals have not spiraled out of control. Russell Investments' senior investment strategist BeiChen Lin pointed out:
The US labor market and housing market are still in a healthy state and have not shown signs of overheating, which will help cool inflation.
He added that while consumer concerns about inflation have recently risen, the 5Y5Y inflation expectation (the market's 5-year forecast of 5-year inflation) is still around 2%, indicating that the market still has confidence in long-term inflation control.
According to a survey by The Wall Street Journal of analysts, the February CPI (Consumer Price Index) data is expected to show a slowdown in inflation.
