Source: Talk Outside

Yesterday (March 10th, Eastern Time), the US stock market continued to suffer heavy losses after 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 all experienced varying degrees of decline, with Tesla being the worst hit, dropping 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 over $800 billion. Moreover, the X platform was also attacked yesterday, resulting in a shutdown and paralysis, so it seems that the old man has not been having an easy time recently either.

Of course, the Altcoin market is not doing well either. Affected by the overall market sentiment and environment, today (March 11th, Beijing time) BTC fell to around $77,000, and ETH directly broke below the $2,000 psychological level, dropping to 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, over 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 subjective perspective, 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. The bear market atmosphere is further enveloping everyone...

1. Is Trump deliberately causing a recession?

Recently, there has been a view circulating online that Trump is deliberately creating a recession by causing so much trouble. It's unclear how many people hold this belief.

In fact, we have mentioned Trump's topic in our 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, let's make a more intuitive assumption (note that this is just an assumption): If the US stock market continues to plummet like this and some extreme situations similar to the 2020 COVID-19 period occur, such as circuit breakers, 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 form of fantasy. The short-term market trend is impossible to accurately predict. But one thing worth thinking about is: Trump may become a catalyst for a new and larger bear market, and conversely, he may also become a 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've noticed that the members in the group have started to discuss the market situation enthusiastically again, and the atmosphere of discussion has become better today compared to the calmness of the past few days.

However, the opinions are different. Some members 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 to buy the dips. But recently, I've noticed an interesting phenomenon - regardless of how the market crashes, the messages I see in the background have become fewer and fewer. It seems that people no longer actively ask such questions. I wonder if they have already incurred losses and exited the market, or have become numb to the crashes, or have successfully escaped the top.

At the same time, another interesting phenomenon is that the average readership of the Talk Outside articles has not decreased compared to previous articles, and there are even some new members (new followers) leaving messages asking basic questions, such as 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 Crypto Summit, the US strategic reserve of Bitcoin (it's worth noting that the strategic reserve is currently only at the level of executive orders, and this strategically significant event is just the beginning, and we still need to pay long-term attention to it. 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), etc. These are all things that can be openly discussed on the public stage, 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. As always, it depends on your own position and risk preference.

The short-term market is impossible to accurately predict, but I will always maintain a long-term optimistic view, which has been mentioned in previous articles. Regarding the current overall market sentiment, our suggestions can be summarized as follows:

- For long-term trading

As long as the targets (such as BTC, Tesla) are ones you are bullish on in the long run, then you can 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 long-term.

For example, now that you see Bitcoin at around $70,000, 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 personal assets into N parts to continuously purchase (dollar-cost average) 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 article: the best time to do this is ten years ago, and the next best time is now.

- For short-term trading

It is strictly based on your position and risk preference to conduct take-profit/stop-loss operations.

For example, for take-profit, you can customize it by combining K-line 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 also achieve staged take-profit, avoid falling into greed and forgetting your own trading discipline. As for 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 drops by 20% during the holding period, I will directly stop loss and close 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 (for example, trade several times a day), unless you also think you are a professional trader who can real-time grasp the market.

So, should you buy the dips or cut your losses now? You can reconsider based on your position and risk tolerance. Tomorrow is "312", I wonder how many people still remember March 12, 2020, as shown in the figure below (the night 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 has 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 $2.1 billion new issuance has led to a significant drop in MicroStrategy's stock (as well as other comprehensive factors such as market sentiment).

The Bitcoin that MicroStrategy has purchased since last November has currently 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 a historic 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 to wait and manage their assets? 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 for some coins may be restarted.