Attention everyone! The market has truly changed, all trends are quietly reversing. Today’s impactful news will directly clarify the mid to short-term trends of the entire market. If you listen carefully, the direction of operations tonight will be completely clear.
First, the first and most explosive signal—crude oil has completely surged, stabilizing above the $100 mark!
Due to the ongoing tense situation in the Middle East, shipping in the Strait of Hormuz has frequently been attacked, greatly increasing the global supply risk. Brent crude oil soared over 6% in one day, stabilizing at $107, while WTI crude oil also surged nearly 7%, breaking $102, both setting new highs in four months. More critically, Saudi Arabia has cut its oil production in August to its lowest level since 1990, which means that the pattern of global crude oil scarcity has solidified, and inflationary pressures will only increase.
Soon after, U.S. inflation data exceeded expectations again, leading to a full probability of the Federal Reserve raising interest rates!
The U.S. August PPI data far exceeded market expectations, with a year-on-year increase of 5.4%, completely shattering hopes of cooling inflation. Once the data was released, the market instantly shifted, and the probability of the Fed raising interest rates in September soared from 61% to 72%, with the market now fully pricing in another rate hike by October at the latest.
As interest rate hike expectations rise, the U.S. Treasury market reacted with a sharp decline, and yields surged across the board.
Even though the U.S. Treasury has intervened to buy back bonds, it has not calmed market sentiment. Currently, the yield on 10-year Treasuries is nearing 5%, a three-year high, while the 30-year yield has surged to 5.36%, breaking a 19-year record! High rates and high yields of U.S. Treasuries continue to siphon global funds, putting pressure on all risk assets.
Not just the U.S., the European Central Bank is also tightening monetary policy, raising rates by another 25 basis points, marking the second rate hike this year.
The President of the European Central Bank openly stated that the ongoing geopolitical conflicts in the Middle East will long keep inflation elevated, and the inflation level in the Eurozone will exceed the 2% target for a long time. In other words, a new wave of global interest rate hikes is sweeping through the entire market.
Under multiple negative pressures, U.S. stocks have already started to buckle, dropping for four consecutive days.
The Dow, S&P, and Nasdaq collectively weakened, with the storage chip sector plummeting; SK Hynix, Micron, and Intel all fell over 5%, clearly under pressure across the tech sector. Only Apple rose against the trend, being the only highlight in a sluggish market.
At this point, many people must be panicking: Is the market going to completely weaken? Is the trend completely over?
Don’t panic yet! Here’s the key: tonight at 20:30, the U.S. August CPI data is the core key that will determine the mid to short-term trend!
This is the last and the most important inflation report before the Federal Reserve's September meeting, no exceptions. Currently, market expectations are for an overall CPI of 3.4% year-on-year, and a core CPI of 2.4% year-on-year.
Let me share the current market logic:
Oil prices breaking $100, PPI exceeding expectations, and soaring U.S. Treasury yields, these three signals combined have directly boosted global inflation expectations and further raised the probability of interest rate hikes.
From a three-dimensional perspective, before the current CPI is released, the market is generally experiencing a volume contraction and oscillation, with neither bulls nor bears daring to take action; the direction is completely unclear; meanwhile, the inflow momentum of ETFs has stalled, and short-term buying power from bulls has clearly weakened.
In summary: the overall bull trend of the current market structure has not been broken; it is simply under pressure from inflation and interest rate hike expectations in the short term.
Tonight’s CPI is the watershed moment! If the core CPI data exceeds expectations, stabilizing at 0.3% or above, BTC is likely to directly surge into the $75,000–76,000 range, leading the entire market to welcome a short-term trend change.
There’s no need to blindly look bullish, nor to panic excessively; patiently waiting for tonight's data release is the best operational rhythm moving forward!
Our circle has been operating for the seventh year now. From the early Knowledge Planet, to Wasabi Circle, and now to the current community, I do not want to set boundaries for myself. The content of the circle will continue to expand, covering the U.S. market; if there comes a day when the Bitcoin trend ends and new opportunity varieties emerge, we will strive to be among the first to seize those opportunities. Investment must have a global perspective and diversify, so that we can operate more calmly.
⚠️ This is a personal opinion sharing, not investment advice. The circle is paid; friends who are interested in joining can add my personal WeChat: hanson1658. (Note: Only add as friends if you intend to join the circle.)
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