The market has recently crashed again, and many people are still studying the Fed's actions.

To be honest, rate cuts and dovish statements should normally be good news, right? But the price of coins still plummeted beyond recognition. Where is the problem?

Let's talk about the first pitfall: Japan has started raising interest rates. Don't underestimate this; now global capital flows are interconnected. When Japan tightens, arbitrage funds immediately withdraw. The crypto market is much more sensitive to interest rate changes than the US stock market. When funds pull out, who can withstand it?

Next, the second mine: this time of year at the end of the year is too deadly. Traditional financial institutions are settling accounts, and liquidity is already tight. There are very few willing buyers in the market. Any slight sell-off causes deep declines, and the drop becomes uncontrollable.

The harshest is the third point: leverage bubble. Do you know how high the annualized cost of leverage is in the market right now? 300% to 400%! Under such financing costs, big players and institutions must liquidate their positions. Not acting is not an option; if they don’t move now, the interest will become unbearable. When the bubble is squeezed, retail investors follow to their doom.

So don’t just focus on Powell's speech. What truly crushes the market is this combination of three punches. Of course, the situation on the ETF side also needs attention; fund flow changes can sometimes be more direct than policy statements.

Having played this game for so many years, this is the toughest test of perception. If you can’t see the situation clearly, no matter how much technical analysis you do, it’s all in vain.