Recently, there has been good news regarding Japan's inflation data. Although the decline exceeded expectations, the key question for the market is: what will the Bank of Japan do next?

Why should we pay attention to this question? Because once Japan advances its interest rate hike cycle, capital flows will change. Some funds seeking certain returns may flow back from the crypto market to traditional financial channels, which could cause temporary pressure on market liquidity and increase volatility accordingly. However, saying this is a sign of a bear market would be an overstatement.

The prices of crypto assets are never determined by a single factor. Federal Reserve policies, the global central banks' monetary easing, market risk appetite—these are the main variables influencing the overall trend. Japan's rate hike is indeed a negative signal, but it must be considered in conjunction with other conditions for a comprehensive assessment.

Since uncertainty has increased, trading strategies should be adjusted:

First, beware of impulsive chasing and panic selling. During periods of policy expectation changes, emotions are easily hijacked, often resulting in poor risk-reward ratios.

Second, monitor the liquidity conditions of the US dollar. The performance of US stocks and US bonds will directly affect the attractiveness of risk assets, serving as higher-level indicators.

Third, moderately control your positions. When the market direction is unclear, heavy exposure to risk is too dangerous. Keep sufficient cash reserves and wait for clearer opportunity signals before deploying.

In fact, such macro disturbances often come with good entry opportunities. If the market experiences irrational declines due to policy expectations, it could be the golden time to select high-quality crypto assets. The key is to manage risks properly, stay calm, and opportunities will naturally come.