Recently, the USD to CNY exchange rate broke below 7, which is a signal worth pondering. Generally speaking, if the Federal Reserve insists on a high-interest policy, the US dollar as a safe-haven asset should remain stable. What does breaking below 7 indicate? It suggests that hot money is starting to find new destinations—not piling into US fixed-term investments, but instead seeking new opportunities like the Japanese stock market and cryptocurrencies.

I still vividly remember the crazy wave in 2021. At that time, the USD to CNY exchange rate soared to 1:6.18 at its peak, triggering a market explosion. The May 19th wave was intense, but after a few months of correction, it started to recover in September, with altcoins leading the surge. By November, the market was flying full throttle—AXS skyrocketed from a few cents to over 100 dollars, and Bitcoin surged to 67,000. This cycle has begun to decline from here.

The market is indeed hard to predict, but if you ask me about the outlook? I remain bullish, for a simple reason—the upward trend line for the bulls has not been broken. As long as this line holds, there’s no reason to be pessimistic.

Regarding specific strategies, contract traders who are risk-averse should hold lighter positions, while those who aren’t afraid of volatility can be more aggressive. Swing trading seems good for catching small moves, but it’s also fraught with pitfalls. I’ve suffered losses—back in May 2024, Ethereum shot up over 30% from just above 2000. Many swing traders wanted to short at a 10% pullback, and the short-selling funds were crazy at that time (I was involved too), thinking a correction was coming. But instead, it continued to rise by another 15%, and in the following weeks, it kept climbing by another 30%. That’s the risk of swing trading—selling too early, getting shaken out, getting squeezed, or getting liquidated. Pick your poison.