The recent market conditions are indeed a bit uncomfortable. Yesterday, BTC dropped below 86,000 again, and there are reports online that tens of thousands of traders have been liquidated across the network. Long investors are probably experiencing the pain of losses. Today's trend definitely warrants a thorough analysis of the underlying logic.

From a news perspective, two factors are currently weighing down the overall market sentiment.

First is the pressure from the appreciation of the Japanese yen. The Bank of Japan is set to raise interest rates this Friday, breaking the low-interest-rate environment that has lasted for over a decade. For a long time, the yen has been the cheapest funding currency globally, used extensively for arbitrage trading—borrowing cheap yen to invest in high-yield assets. If the Bank of Japan truly ends its negative interest rate policy, those arbitrage positions built on low rates will need to be closed. Large sums will be repaid, liquidity will tighten, and risk assets will face selling pressure. The market expects this rate hike to be 25 basis points, enough for institutions to act preemptively and withdraw early.

Second is the uncertainty surrounding the Federal Reserve's policy. There are reports that Trump may nominate Kevin Woorh to be the Federal Reserve Chair, known for his hawkish stance. The market had been expecting significant rate cuts next year, but this expectation is now beginning to waver. If the Fed Chair shifts to a hawkish stance, it could mean that global liquidity will remain tight for a long time. The uncertainty in monetary policy is undoubtedly a double-edged sword for the rising crypto market.

From a technical perspective, the 4-hour candlestick chart has already issued warning signals. The MACD indicator has formed a death cross, with the white and yellow lines below the zero axis, indicating a clear bearish signal. This is not just a normal correction but a definite sign of weakness. The seemingly solid support level at 86,000 has been easily broken, with selling pressure much stronger than expected. Currently, the next support is at 83,800, and further down at 82,300. If any of the two macro-negative factors mentioned above materialize, panic could spread rapidly, and the price might directly test the critical zone between 80,000 and 78,000.

Overall, in the short term, close attention should be paid to the development of these two variables.