The market movements over the weekend were completely as expected. If I had traded short-term at the anticipated price levels, it would have been no problem, as I hit both the highest and lowest points perfectly. But why do I only trade during holidays and not start on Monday in Beijing time?

This is due to liquidity reasons. On Saturday, it is possible to assess the impact of low liquidity on prices. Low volatility and low turnover indicate that most investors are unwilling to participate in trading, which is a sign of narrow fluctuations. By observing price changes further, one can arrive at a conclusion with a relatively high accuracy rate, but this only applies to low liquidity situations.

When Monday in Beijing time begins, although the liquidity provided by the Asian time zone is not very high, it is still an improvement compared to the weekend. Especially with the opening of CME and U.S. stock futures, prices can become unpredictable. Therefore, after Sunday ends, I stop my short-term trading approach. Of course, I didn't manage to trade over the weekend for various reasons, but the trading ideas for #Bitcoin I provided were correct; the prices are right there for all to see.

Starting from Monday, I have been saying for two weeks that January 6 is when liquidity will gradually return. On one hand, the Christmas holiday is coming to an end, and on the other hand, two weeks later is the power transition. The biggest influence on the current market is the Federal Reserve's expectations for interest rate cuts in 2025, which the market has been gradually digesting during the Christmas period.

Indeed, the rise of the dollar will lower investors' risk appetite, which is a fact. Monetary tightening will also make liquidity less abundant, which is also true. However, the power transition after the election is the climax of the election cycle. The next period will depend on how Trump implements policies regarding the cryptocurrency industry after taking office, making it difficult to have a certain cycle.

This post is sponsored by @ApeXProtocolCN | Dex With ApeX

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