After ending the tariffs on Greenland, I originally wanted to take a breather, but $BTC it fell again, and it dropped quite significantly over the weekend. This time, there could be three possible situations: the first is that Trump is very unhappy with a trade agreement with Canada and China. However, today Trump still published two articles warning Canada that he is never stingy when it comes to using tariffs as weapons. Therefore, the market is also worried that on Monday, Canada and China might take joint resistance actions. Although it’s still just verbal for now, if an 'antagonism' really forms, the market will definitely be concerned about the potential risks that could arise. Although there might also be a TACO incident, the market will absolutely not remain indifferent.
In addition to tariffs, the United States and Japan may join forces to intervene in the yen exchange rate. Although it is not as severe as tariffs, such intervention could affect the arbitrage market, especially for the yen, which is a sensitive borrowing asset. The third point is that the probability of a U.S. government shutdown has increased again, and the budget set to expire on January 31 is facing issues.
The probability of a current Kalshi shutdown has directly surged to 78.5%. However, this shutdown may not be as comprehensive as the one in October last year, as some functional departments have already received their annual budgets and will not enter a shutdown. Therefore, relatively speaking, even if a shutdown occurs, it should not be larger in scale compared to October.
Looking back at Bitcoin's data, the turnover rate has increased, and such a high turnover rate over the weekend indicates that the market has begun to panic. With three layers of negative factors, investors are likely feeling overwhelmed, and this is still during the weekend before the U.S. stock market opens. Similarly, in a few hours, we will be able to see the performance of Asian investors, followed by that of U.S. investors.
To be honest, tariffs have repeatedly been used as a weapon by Trump, and the results have not been good each time. Seeing the negative market reaction, Trump may again TACO!
