The sharp decline in the early morning once again taught market participants a lesson. A well-known trader was liquidated in this round of market movement, with 6489 ETH instantly evaporating, resulting in a direct loss of $720,000. Since going long in October, his account has accumulated losses of over $33 million. This liquidation also exposes a harsh reality—the bigger the fame, the less immunity one has in the market.

Let's analyze why this market played out this way. Before the Federal Reserve announced interest rate cuts, institutional funds had already been embedded. They pushed BTC to 110,000 by hyping the "rate cut expectations" concept. When the actual data was released and retail investors rushed to buy, institutions turned around and dumped their positions. This "buy on expectations, sell on facts" logic is played out every time, but each time, many participants end up getting caught.

What was the result? In 24 hours, BTC dropped from 95,000 to 89,000, with 100,000 traders getting liquidated, and the market evaporated over $200 million in funds. Even more painful, Powell's subsequent statements directly burst the liquidity illusion—next year’s rate cuts may be much slower than expected, possibly only once in 2026. Such policy shifts are like pouring a bucket of cold water on the market.

Risks are also emerging. Expectations of a rate hike by the Bank of Japan on December 18, and the possibility of continued tightening of global liquidity, are rising. Once these expectations materialize, the pressure on the market will become even more evident. History always repeats itself, but participants are often slow to realize it.

The trader’s experience is worth reflecting on. His leverage once reached 30x. With such a position, any fluctuation was like walking on the edge of a cliff. In just two months, $20.62 million of principal vanished. This is not an act of nature, but a complete loss of risk management.

The eternal truth the market teaches us is simple: when the entire network is unanimously optimistic about a certain positive signal, it’s often a sign that the market is near a turning point. Don’t rely on insider info from big players, and don’t expect anyone to predict the market in advance. The only thing that can truly protect you is strict risk control and a respectful attitude toward the market.

What stage is the market at now? High-leverage head positions are being cleansed, and panic is spreading. Is this the bottom or the start of a new decline? No one can say for sure. But one thing is certain—participants in the next wave of market movement should learn from this liquidation wave.