We spoke too soon, fellas! Bitcoin dropped to around $93,000 at the time of this writing. Anyway, how did this affect the market? Well, somewhat predictably—as always, when Bitcoin dumps, altcoins also take a hit. Over the past 24 hours, everything is down significantly—Ethereum by about 10%, XRP by around 6.7%, Solana by about 10%, Dogecoin by 12%, and so on. At the moment, the total value of liquidated positions in derivative markets is nearly $700 million, and the market capitalization has dropped by approximately $300 million. It's an absolute bloodbath—hopefully, you didn't overdo it with leverage. But why did this happen? In Monday's newsletter, we mentioned that a report on the state of the U.S. labor market was expected yesterday, and we explained that this information is used by investors to position themselves. Well, the data didn't meet expectations. It turns out that the labor market in the U.S. is slowing down—the number of job openings has increased, while at the same time, fewer people are leaving their jobs. Although the Federal Reserve chair tried to reassure the markets, stating that this decline is gradual and within norms, investors took a more cautious stance, and the drop wasn't limited to crypto. The S&P 500 is down by over a percent, the NASDAQ Composite is down by almost two percent, and many stocks also saw declines. So, even though many people are expecting a serious bull run in 2025, this by no means excludes such short-term drops (hopefully, they are short-term), and it's very important to remain cautious and steer clear of high-leverage positions so as not to become part of the statistics! |