Why did it drop these days? Three reasons

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1. Japan: No rate hike on the surface, but preparing to hike in June
Japan indeed did not raise interest rates this time. But out of 9 officials voting, 3 opposed, saying it should be raised now. This is the biggest disagreement in recent years.
The market was immediately panicked, and the probability of a rate hike in June rose to 74%.
Why is this serious? Because Japanese yen interest rates are too low, many large institutions borrow yen to invest in US stocks and the crypto market. Once rates are raised, the yen becomes more expensive, and they will have to sell assets to repay loans.
It happened again in August 2024, when Bitcoin dropped from 65k to 50k in a week. The market fears the same will happen this time.
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2. US-Iran negotiations: Break down
Over the weekend, US-Iran talks broke down again. The US said nuclear issues must be discussed now, Iran said it will wait until the war is over. Both sides exchanged accusations at the United Nations, and the US Navy Secretary suddenly changed.
When such geopolitical conflicts escalate, high-risk assets like cryptocurrencies are the first to be hit. Within 24 hours, 100k traders were liquidated across the network, nearly $400 million vanished into thin air.
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3. Federal Reserve: Funds run before the meeting
This week, the Federal Reserve is holding a meeting, most likely to keep interest rates unchanged. But this is Powell’s last meeting in office, and a new chair will take over soon.
No one knows if the Fed’s stance will change. Large funds are not waiting; they are pulling out first.
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Summary: Japan’s landmines, US-Iran deadlock, and the upcoming Fed meeting—three bad news hit on the same day, leaving the market no time to digest.
At such times, lighten your positions and set stop-losses closer.