This wave of decline has finally stopped, and currently, the short-term is rebounding. It is expected that Bitcoin will oscillate within a narrow range of 10,000 points around the two price levels of 74 and 84, and the trading suggestion is to short high and long low, avoiding blindly chasing long or short positions.
If the 10-year TIPS firmly stands above 2% (with both inflation expectations and real interest rates high), the cost-performance ratio of risk assets will collapse completely. From S&P 500 to gold to everything in the cryptocurrency market that carries risk premiums will face the soul-searching question of 'why not just take risk-free returns'—killing valuations, killing leverage, killing everything. This is not alarmism; every time the yield curve steepens during a bear market, liquidity withdraws the fastest, which is why the market has plummeted in the past few days despite the lack of bad news. The fundamental issue is that liquidity is withdrawing.
I still hold the same judgment: not increasing liquidity has not solved the problem because the real demand gap for cash is too large. Merely cutting interest rates can only suppress the short end; differentiation will only become more severe, and the long end will not accept it, causing the curve to continue steepening. The intensity of liquidity shocks is likely to be more severe than what the market is currently pricing. — Think about that wave in 2022, when the cryptocurrency market directly switched from a bull market to a bear market mode. Now, with the addition of this variable from Trump, regulatory easing on privacy coins may make these sectors heat up, but under overall macro pressure, the ceilings for VC coins and Memes will be limited.
