Hey folks, I’m your old acquaintance, Analyst Lao K, who has been deeply engaged in the crypto circle for five years!
Are you sweating as you open your trading software right now? Is the K-line fluctuating up and down like a roller coaster, while your heart is pounding louder than anyone else’s? Don’t panic, and don’t waste time on those messy rumors. Tonight, I’ll guide you through this big chess game step by step, ensuring that the core logic is explained clearly, so you’ll feel reassured after reading!
Highlight this! Tonight at 21:30, two data points will determine life and death (every word is worth its weight in gold).
Many newcomers may think, "Aren't these just two economic data points? Why so tense?" That's a big misconception! These two pieces of data are not just minor fluctuations in the market; they are the "key indicators" that directly shape the Federal Reserve's policy, thus guiding the entire cryptocurrency market. Let me first break down the underlying logic for you, and then I'll share my core viewpoint.
First wave: Core CPI (forecast 3.1%), the 'barometer' of inflation, directly endorsing Powell.
First, understand a core logic: The most tangled issue for the Federal Reserve right now is 'can inflation be stabilized?'. This CPI data serves as a 'stamped certification' for Powell's speech.
Here comes my point: Don't just look at 'higher or lower', look at the deviation! If the announced value is higher than 3.1%, and noticeably so (for example, above 3.3%), it essentially tells the market that 'inflation is still not under control'. At this point, what Powell previously said about 'high interest rates lasting longer' will not be mere rhetoric; the market will react immediately, the dollar will definitely rise, and the crypto market we focus on, as a risk asset, will likely take a hit, with a significant pullback.
But what if it is below 3.1%, even dropping below 3.0%? That’s a different scene! The market will interpret it as 'inflation has finally bowed down', and the previously suppressed expectation that 'the Federal Reserve might cut rates early' will emerge instantly; funds will rush into risk assets, and the crypto market might see a decent rebound. However, I want to remind you: don't blindly chase rises; such 'data-driven rebounds' often have large fluctuations and can easily trap people.
Second wave: Initial claims for unemployment benefits, the 'touchstone' of the labor market, a 'hidden variable' more critical than CPI
If CPI is the 'overt bomb', then initial claims for unemployment benefits are the 'covert trump card'. Powell and the big shots on Wall Street are watching this data more than anyone else because it directly reflects whether the economy is cooling down.
Here I want to share a 'counterintuitive logic': A high number of unemployment claims is not necessarily a bad thing. My judgment is: If initial claims for unemployment benefits soar, it indicates that the labor market is genuinely cooling down, and the economy is slowing down. At this point, the market won't panic; instead, it will speculate that 'the Federal Reserve is forced to cut interest rates early to save the economy', creating a bizarre situation where 'bad news turns into good news', and funds will flow out of the dollar and US bonds into the crypto market for hedging and speculation.
However, if the number of unemployment claims remains very low, it indicates that the job market is still very 'tight'. The conclusion then is clear: The Federal Reserve doesn't need to rush to cut interest rates; high interest rates will last longer. This is purely bearish for the crypto market, and there’s not much to discuss; it is likely to continue to trade sideways or dip.
Final conclusion from Old K: Tonight is a 'direction switch', and volatility will inevitably be full throttle; don’t operate blindly!
To sum up: Tonight, these two data points will directly determine whether the market is 'trading recession (hoping for rate cuts)' or 'trading high interest rates (fearing rate hikes)'. Regardless of which situation, volatility will not be small, and 'spike' situations, where prices suddenly fluctuate dozens of points, will likely occur.
My operational advice (purely personal opinion, not investment advice): Before the data comes out, don’t go all in or be completely out; keep some position to observe; after the data comes out, don’t chase rises or sell off; first, clarify the market's real reaction, and only act when the market stabilizes. Many people get trapped by 'disorderly operations right after the data is released'; remember: what we need to do is 'follow the trend', not 'bet on the data'.
Finally, let me say something from the heart: The crypto market has never been a place for 'gambling on luck'; understanding the underlying logic and following key data and policies is the way to go far. Once the data is released tonight, I will immediately analyze the market in the background and provide specific response strategies.
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