Since the sudden dip of the Candlestick last night, market sentiment has already fallen to the bottom. The nearly 6000-point fluctuation of Bitcoin in a single day is shocking enough, but the "backstab" from alts is even more deadly—many people have just pulled themselves out of the risk on October 11, only to be repeatedly impacted by a month of fluctuations, and most are now in a state of "either dead or severely injured."
But at this moment, with only a trace of "remaining health," what we should do is not to panic and make reckless decisions, but to stabilize our mindset and stop blind operations. It is important to know that the current slump may just be the darkness before dawn.
Many people are unaware that the impact of the U.S. government shutdown is comparable to a "stealth interest rate hike." Due to the inability to allocate funds during the shutdown, the Treasury's General Account (TGA) balance skyrocketed from $300 billion to $1 trillion in three months, which is equivalent to directly pulling $700 billion in liquidity out of the market.
Looking at it from another perspective, in such a harsh external environment— the crypto world is like a "stepchild", as the "second pool" of liquidity for the US stock market, it also faces the pressure of the dollar index breaking through 100 countercyclically— yet it has only dipped this little, which already demonstrates remarkable resilience.
Just hold on for the last week or two. When the U.S. government restarts and the Treasury begins to draw down the massive TGA cash balance, as much as $900 billion will flow back into the banking system, which is akin to an "invisible quantitative easing." By then, the good days in the market may really be here.