A recent speech by an analyst at a large bank made me re-examine the logic of this round of market.

The so-called "hawkish interest rate cut", to put it bluntly, is to brake after a cut, which is not the same thing as the "continuous release of water" that everyone imagines. When there were rumors of interest rate cuts in the market last year, BTC soared from $60,000 to 100,000, relying on the expectation that liquidity would continue to loosen. Now the question arises - the U.S. employment data is still solid, and inflation has not completely flattened, in this case, what reason is there for the central bank to cut interest rates continuously?

There may be a brief period of excitement in the market. In the days when the news of the interest rate cut landed, mainstream assets such as BTC and ETH will most likely rise in waves, after all, the release of liquidity is real. But how long can this increase last? Once policymakers make it clear that they will pause further action, funds will quickly realize that expectations have failed. Those who chase high are likely to become receivers.

Altcoins are riskier. Now many small currencies are completely speculating on the concept of interest rate cuts, and the fundamentals are very fragile. Once the expectation is reversed, these targets will most likely collapse first.

There is another variable - the decision-making level is not monolithic. If someone advocates for more aggressive easing, market sentiment may swing back and forth. But judging from the current economic situation, the probability of conservatives having the upper hand is higher. After all, the lessons of inflation in 2021 are still fresh in mind, and no one wants to experience it again.

My idea is very direct: I don't chase the rise on the day of the interest rate cut, but consider reducing my position in some mainstream coins on the rise. If interest rate cuts are really suspended in the future, the crypto market is likely to step back on the previous support level, and then it is a more rational choice to build positions in batches. The market is never short of opportunities, what is lacking is patience and discipline.