Recently, those who have been watching the market should have felt that the market atmosphere is a bit off. The Bank of Japan might really be serious this time — the probability of a rate hike in December has been pushed to 80%, and in January it’s even directly at 90%. Don't underestimate this number, behind it lies a massive $19 trillion trap of interest rate arbitrage.

This morning, BTC broke through 83000 with a large bearish candlestick, and many people thought it was just a routine pullback. However, if you understand the rules of the trap trading game, you know that this drop might just be an appetizer. Why? Because the global market has been playing a game for decades: borrowing the super low interest rate yen and converting it into dollars to chase high returns in the US stock market and the crypto space. The premise of this strategy is that the Central Bank of Japan never raises interest rates.

Now this premise is about to collapse. I flipped through the calendar and suddenly noticed a detail - December 19 happens to fall on the eve of the Christmas holiday. Do you remember that Christmas in 2022? At that time, the Bank of Japan suddenly adjusted the YCC policy in the December meeting, raising the upper limit of the 10-year government bond yield from 0.25% to 0.5%, causing global asset prices to crash immediately.

The current script is almost identical to that of the past: on the eve of the holidays, market liquidity is already thin, and the Bank of Japan is sending hawkish signals. Once interest rate hikes are truly announced, the funds borrowed in yen will rush back to pay off debts, and at that time, whether it's the U.S. stock market or the crypto market, liquidity will be instantly drained.

BTC, as a highly volatile asset, is definitely the first to suffer. Once this trap in the carry trade is broken, the market is likely to face trouble in the coming weeks.