Tonight is once again the day of the Federal Reserve's conference, and the entire cryptocurrency world is watching Powell to see whether he will be tough or soft, and whether he has a hammer in hand.

First, it's important to clarify that the three things happening tonight are connected and the schedule is tight. At 2 a.m., the interest rate decision will be released, which is basically a foregone conclusion; there's definitely no cut. What’s really worth watching is the dot plot released simultaneously — 19 people drawing dots to indicate future interest rate expectations over the next three years. What the market is really focused on is this chart, not the interest rate itself. Now that oil is pushing up again and inflation is not coming down, the outlook on this chart will likely not be good.

As soon as the interest rate and dot plot are out, Powell will have to speak, starting at 2:30 a.m. This old man doesn't say much, but every word can crash the market. If he happens to mention “stagflation”, the mood tonight will completely change. Judging by the rhythm, the probability of negative news tonight is indeed not low.

Let's see how the market reacts. Last year, during four interest rate meetings, Bitcoin dropped each time, at least by 10%, and at its worst, by 30%. The adjustment cycles were basically around two weeks. Will this happen again? Not necessarily, but history is there, so being cautious is not a bad idea.

Overall, tonight's juncture is very likely to be a turning point. My own strategy is quite simple: I hold low-leverage long-term short positions, with the logic being that the upward space is visible, while the downward space relies on imagination. I don’t bet on the direction in the short term; it’s enough to find key levels to trade back and forth.

Like that surge yesterday afternoon, where ETH took profit at 2310, and then I entered again on the rebound. The short position at 11 p.m. for 2350 came down directly in half an hour. That's just how it is — direction doesn’t show up every day, but volatility is there every day; if there’s volatility, there’s something to play with.

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