#夏日创作营 Market talk: US stocks and the crypto market both face pressure—everyone is waiting for the Fed to “deliver the verdict”

The global market mood has been visibly tense lately. Whether it’s the US stock market or virtual coins, everyone is clenching their hands and watching, with all suspense hinging on tonight’s Federal Reserve interest-rate decision.

First, let’s look at overnight US stocks. The three major indexes moved in completely different directions, leaving people confused. The Dow rose steadily by 0.51%, the S&P 500 inched up barely, nearly flat, while the Nasdaq fell slightly by 0.18%, and the AI chip sector collectively sputtered and weakened. Capital clearly rotated toward risk aversion—dumping high-level semiconductor and AI computing-power stocks, then piling into stable, established blue-chip leaders. Apple directly set a new all-time high, with total market cap surging to $4.95 trillion, overtaking Nvidia to become the world’s top stock. At the same time, Google and Microsoft both jumped sharply. By contrast, Tesla, TSMC, and storage-chip stocks all weakened across the board, making the sector split especially extreme. Another standout: the China concept “golden dragon” index surged against the trend, up 2.5%. PDD, NetEase, and Li Auto all rose, providing one of the few pockets of warmth on the board.

On the international news front, the biggest headache for the market right now is inflation and expectations for rate hikes. The US-Iran situation keeps tugging back and forth. After oil prices surged earlier, they then crashed by more than 10%. Inflation risks have swung between high and low, directly lifting the probability of further Fed rate hikes. The market’s bet that the Fed will raise rates by 25 basis points is already up to around 36%, and the divergence between bulls and bears is especially large. Bank of America also directly warned that August to October will be the three toughest months for US stocks this year. Historically, during this period the broader market has basically generated little returns. It makes sense that funds are cutting positions early to de-risk ahead of time.

Now let’s shift to the crypto market. Today has brought a wave of violent pullback— the situation is truly hard to watch. Bitcoin slipped below the 64k mark, down more than 3.5% over 24 hours. Ethereum is down close to 4%. Many altcoins are falling even harder. Solana and Dogecoin are down more than 4% across the board, while some smaller coins have crashed by more than ten percentage points. Most painful of all is the liquidation data: in just 24 hours, more than 160k people were liquidated globally, with total liquidation amount close to $700 million. The vast majority were long positions being cleared. The drop triggered a chain reaction of leverage liquidations—falling leads to selling, which leads to even more selling—forming a “death spiral.”

This crypto selloff isn’t some random dumping. The core reason is institutional funds fleeing. The spot Bitcoin ETFs that had seen consecutive days of net inflows suddenly recorded large net outflows a few days ago. Institutional money took profits and exited, tightening liquidity immediately. The market had originally been hoping for a regulatory easing to bring positive catalysts, but once the shadow of rate hikes presses down, all good news becomes ineffective. Funds sell high-risk crypto assets at the first opportunity.

Now whether you’re trading stocks or playing crypto, everyone is waiting for tonight’s Fed rate decision. If the Fed releases a hawkish signal and hints that further hikes are still coming, US growth stocks and crypto will likely keep dipping. If rates are kept unchanged and the wording is relatively more accommodative, the market could see a round of short-term repair and rebound.

A practical reminder to ordinary retail investors: right now, don’t go all-in with a heavy position. The uncertainty on the board is at maximum. There are major upside and downside volatility risks for both bulls and bears. Staying light and waiting for the decision to land is the safest move for now.