#美联储降息 This market really tests nerves. The Bank of Japan is about to hold a meeting, with the probability of interest rate hikes soaring to 80%, and possibly surpassing 90% in January. This is no joke — approximately $19 trillion of yen carry trades globally, once closed, could trigger a chain reaction. Remember how the global markets reacted when the Bank of Japan adjusted its policies at the end of 2022? This time, the scale is even larger.

The timing is very nerve-wracking — approaching December 19th, just before Christmas, when market liquidity is already fragile, Japan raising interest rates at this time is like adding fuel to the fire. For years, the yen has been nearly at bargain prices, with institutions borrowing aggressively in yen to go long on US stocks and cryptocurrencies. Once Japan tightens, these funds must flow back, with assets like BTC taking the brunt.

Market data is even more eye-catching: BTC has already fallen over 20% this month, related ETFs have seen outflows of $3.5 billion, and over 400 million in liquidation. The market is extremely fragile. Meanwhile, on the Fed side, Powell has chosen to stay silent; silence often precedes a storm. Japan tightening and the US holding back, combined with both sides putting pressure, have clearly weighed on crypto assets.

Mainstream coins like BNB and SOL have also suffered heavy declines. On-chain ecosystem projects have fallen back to historic lows in valuation, and new growth opportunities don’t seem to have opened yet. However, historically, after Japan raises interest rates in 2024, BTC tends to hit new highs within three months. Short-term carry trade liquidations are indeed risky, but they’re not necessarily a long-term nightmare.

It’s crucial to keep an eye on these two key moments: the December Bank of Japan meeting and the Federal Reserve dot plot update. If you want to participate in bottom-fishing, first manage your positions — don’t go all in impulsively. When the market is this fragile, survival is more important than anything else. The next rebound could be the real opportunity.