Interpretation of cryptocurrency market on March 14th, 2023

The U.S. banking sector plunged again last night. This time cryptocurrencies and gold are moving in sync. The crypto industry has also become the first choice for safe-haven money after the U.S. banking sector revealed its problems. The market is forcing the Fed to re-examine the subsequent path of interest rate hikes. Which is more harmful, inflation or economic crisis?

The Fed is responding to the banking crisis with a relatively conservative strategy, protecting depositors but not bank shareholders. The banking industry does not face serious problems. U.S. bonds are not considered risky assets, just floating losses. As long as the injection of liquidity, holding on to the U.S. debt to maturity one after another is not a loss. Even if the bankruptcy, there are a large number of U.S. debt backing, it is only a short-term need for funds to respond to depositors' withdrawals.

Therefore, the suspension of interest rate hikes in March. The probability could be better at the moment. If it happens will also be the most significant positive. Because not raising in March means it is challenging to raise again later. It is the last time. This approach is extreme. But the subsequent earlier stop rate hikes. And the expectation of a rate cut at the end of the year has begun to prevail. Whether CPI tonight can also appear optimistic data, as Biden said, is also a point of concern. By the way, you can verify whether the market has returned to the previous rhythm of insensitivity to the negative and positive reaction to the positive.

This rhythm has always been the rhythm of the bull market.