U.S. Stock Market: Collective Decline, Tech Stocks Lead the Drop

Overnight, the U.S. stock market showed a gloomy picture, with all three major indices closing lower. The Dow Jones Industrial Average closed down 0.62%, while the Nasdaq Composite Index saw a more significant drop of 1.71%, and the S&P 500 Index also fell by 1.06%. Large tech stocks were hit hard in this downturn, with Tesla's stock price plummeting over 5%. Tech giants like Nvidia, Meta, and Broadcom were also not spared, each dropping more than 3%, and Google's stock price similarly fell over 2%. The market generally believes that weak economic data and policy uncertainty are the main factors leading to this decline in U.S. stocks. Additionally, some tech stocks are facing issues such as overvaluation and disappointing earnings, which further exacerbated the downward pressure on their stock prices.

Cryptocurrency Market: Linked to U.S. Stocks, Downward Testing

The cryptocurrency market has always had a certain degree of correlation with the U.S. stock market. This time, as U.S. stocks fell, the cryptocurrency market also could not remain unaffected, following a downward trend. According to data provided by CME's "FedWatch," the market expects a 100% probability that the Federal Reserve will maintain interest rates at the same level in the early hours of tomorrow. Looking ahead to May, the probability of keeping the current interest rate unchanged is 82.4%, while the probability of a cumulative rate cut of 25 basis points is 17.6%. Under such market expectations, the upcoming statements from Federal Reserve Chairman Jerome Powell have undoubtedly become the focus of attention, as his remarks may significantly impact the subsequent trends in the cryptocurrency market.

Bitcoin Market: Volatile Downward Movement, Range to Break

During yesterday's daytime trading, Bitcoin exhibited a clear volatile downward trend, with prices oscillating within a specific range. As the U.S. trading session began, bearish forces suddenly surged, quickly breaking through key support levels, leading to an accelerated decline, with prices dipping as low as around 81,100. However, the strong momentum of the bears did not continue effectively, and there was no further expansion of the downward space. Bitcoin's price movement displayed a unique characteristic of "taking a step back after each advance," appearing strong yet struggling to achieve a substantial breakthrough, and seeming weak yet not easily experiencing a significant pullback. The overall trend is convoluted, with intense tug-of-war between bulls and bears. In the evening, Bitcoin briefly broke through the important support-resistance conversion level of 83,500 within the range, but the rise lacked continuity, and prices remained within the range. Currently, the upper level of 85,000 constitutes strong resistance, while the lower level of 80,500 is a key support level. If 80,500 is effectively broken, the bears may initiate a strong downward trend. Until there is an effective breakthrough and stabilization at these two key positions, it is recommended that investors treat Bitcoin's market with a range-bound trading mindset.

Ethereum Market: Weak Volatility, Focus on Recovery

Ethereum's rebound during the day was very limited, and after reaching a high point of 1,912, it faced strong pressure and declined again. In the evening, Ethereum synchronized with the overall market trend, entering an accelerated downward phase, with the lowest point reaching around 1,871. From recent performance, Ethereum's overall rhythm mainly revolves around a cycle of volatility, with price movements showing a clear weak volatility pattern. Although there were some technical rebounds during this period, the current price has corrected to around 1,925, but investors still need to pay close attention to the breakout situation in the 1,940 - 1,960 range during the morning session. From a technical analysis perspective, the current market pattern is deeply entrenched in a stalemate between bulls and bears. The daily chart clearly shows that price fluctuations are confined within a relatively stable range, with key resistance levels being tested multiple times but showing a pattern of rising and falling back, followed by price pressure leading to further declines, maintaining a volatile state at the short-term level. On the four-hour level, the price movement presents an awkward situation of wanting to break through new highs but lacking the strength to do so, while also not having enough adjustment space if it appears weak, leading to repeated tug-of-war between bulls and bears. This rapidly changing market sentiment has triggered localized technical corrections. In this adjustment trend following a rapid decline, investors need to closely monitor the adjustment and recovery situation in smaller time frames when making trades. Once the adjustment is complete, a primary long position can be considered.

If you are feeling lost—unable to understand technology, unsure how to read the market, not knowing when to enter, unable to set stop losses, not understanding take profits, randomly increasing positions, getting stuck while trying to catch the bottom, unable to hold onto profits, missing out on market movements… these are common issues for retail investors. But don't worry, I can help you establish the correct trading mindset. A single profitable trade is worth more than a thousand words, and finding the right direction is better than repeatedly facing defeats. Instead of frequent operations, it’s better to strike accurately, making each trade more valuable. If you need real-time guidance, you can scan the QR code at the bottom of the article to follow my public account. The market changes rapidly, and due to the timeliness of reviews, subsequent trends should be based on real-time layouts. I look forward to progressing steadily with you in the market.

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