2026-01-06 16:23:21

Starting in 2026, the crypto market has experienced a strong surge. Ethereum broke through $3,185 straight away, and many investors began sharing profit screenshots across various communities, while some voices started asking whether to go all-in and chase the high. But is this kind of rally really that simple?

Having immersed myself in the market for over 8 years and stepped over many pitfalls, I want to give everyone an honest assessment: this wave of market movement is not just a straightforward "rise, rise, rise." The underlying logic is more complex — it is supported by genuine fundamentals but also intertwined with risks driven by expectations. Is it a pie or a trap? The key lies in how you understand the operational routines behind the market.

My view is: blindly chasing the high is not advisable, but there’s no need to be overly bearish either. This rally does have supporting points, and the risks are hidden within various market expectations. Let’s break down each aspect.

**The Real Significance of the Federal Reserve’s Policy Shift**

Currently, the market is collectively immersed in a consensus — the Federal Reserve may cut interest rates in 2026. In December last year, the Fed signaled that it might cut rates three times throughout the year. As soon as this news was released, high-risk assets worldwide responded enthusiastically.

To understand it simply: rate cuts are like the central bank turning on a "water tap" for the market. The pressure on the dollar to depreciate increases, and institutional investors holding liquidity will actively seek new growth points. As a risk asset, cryptocurrencies naturally become a key focus of capital.

History offers a reference. After the Fed cut rates to zero and launched quantitative easing in 2020, Bitcoin achieved more than a fourfold increase in the fourth quarter. Now, the market is betting that in the first quarter, another 25-50 basis points of liquidity might be released. Once these expectations materialize, the attractiveness of funds in the crypto market will further increase.

ETH1.98%

BTC1.5%

View Original

This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.

24 Likes

Reward
24
8
Repost
Share

Comment

0/400

MEVHunterZhang

· 01-09 12:55

Brothers and sisters who are all-in chasing highs, wake up, don't just get carried away by the screenshots... The hype and speculation tactics, we've seen them once in 2020, but how much of it can actually be realized is uncertain.

View OriginalReply0

HodlKumamon

· 01-08 14:37

I have calculated the rate cut expectations, and the historical probability indeed supports this wave of gains (◍•ᴗ•◍) But going all-in would be really funny; the bear recommends a more conservative DCA approach~ --- Wait, can the 4x increase in 2020 be replicated now? The market size is completely different, folks. Data speaks for itself. --- For those blindly chasing highs, let's just wait and see their reaction memes 72 hours later haha. --- The dollar printing is real, but the expectations have already been mostly digested, right? The risk lies in this "once it lands" scenario. --- The bear looked through history, and during these online frenzy times, it's often a warning sign of a top escape... Everyone, be careful. --- The asset allocation model tells me that the risk-reward ratio isn't very favorable right now, but holding tight without moving is also quite difficult, huh.

View OriginalReply0

RamenStacker

· 01-06 16:51

All-in chasing highs is for fools, but it's still too early to be overly bearish now. The rate cut expectations are indeed real money, but be careful not to get cut. --- Honestly, I only half believe what an 8-year veteran trader says. The market tricks are all the same; before expectations materialize, they are all illusions. --- Wait, will the Federal Reserve really cut three times? I feel like global central banks are all easing, but the prices are rising too fast... --- History repeats itself. I missed the 2020 wave; if I miss it again this time, who can I blame? But I still need to keep some backup plans. --- The logic that rate cuts = easing is sound, but institutions have already jumped in. If you're still chasing now... think about the consequences. --- ETH hit 3185 and started showing off with screenshots. That’s probably a sign of the top, too obvious. --- A pie is just a pie, but the risk lies in expectations. That hits hard—really worth pondering carefully.

View OriginalReply0

NotSatoshi

· 01-06 16:40

Full position chasing highs is gambling, don't ask me how I know The rate cut expectation was driven up, but what if it doesn't materialize? Who will buy the dip then? I also went through that wave in 2020, but the situation now is different... Institutional involvement isn't so straightforward Those people who screenshot really dare to show off; how many can withstand this drop? It's called a "support point" in nice words, but honestly, it's just betting on the Federal Reserve's rhetoric Is ETH 3185 really stable? I feel like someone is dumping inventory I've opened the faucet before, and I've also seen it shut with a bang—it's tragic Expectations, expectations, all bubbles supported by expectations

View OriginalReply0

FUD_Whisperer

· 01-06 16:39

Here we go again. Every time the Federal Reserve cuts interest rates, it's all-in with full positions. Will history repeat itself? I don't believe so. Before expectations materialize, it's all just talk on paper. My 1988 lesson was deeply ingrained. The pie-in-the-sky trap theory has worn out my ears, brother. Those who go all-in chasing highs will be crying and screaming again during the next sharp decline. Rate cuts are just an excuse; what truly determines the rise or fall is what tricks the institutions are playing. Let's wait and see, when will 3185 finally be the top?

View OriginalReply0

ForkPrince

· 01-06 16:34

Wake up everyone, are we starting the collective ypp again? Forget about chasing highs with full positions, have you learned your lesson from past losses? --- The expectation of interest rate cuts is being hyped up so aggressively, but has it really materialized? When will the moment of face-slapping come? --- Even someone who has been through 8 years of pitfalls says so, so I need to think in the opposite direction, huh? --- The difference between a pie trap and others is just a fine line, most people end up choosing the wrong one in the end. --- Using the 2020 market trend as a comparison is a bit of an overstatement; the current situation is completely different, right? --- Loose liquidity is definitely a positive, but the scythe is also the fastest during this time. --- Just looking at the screenshot makes me envious, which is why retail investors always end up last.

View OriginalReply0

Layer2Observer

· 01-06 16:31

The expectation of rate cuts is indeed somewhat overpriced, but the data is right here... The 2020 wave has limited significance as a benchmark, given that the environment was completely different back then. Honestly, everyone holding full positions is betting on the expectations materializing. What if the Federal Reserve pulls a dovish surprise? That’s the hidden risk. Institutional entry is real, but can liquidity really last this long? Further verification is needed.

View OriginalReply0