While everyone was focused on the Fed’s rate cut window, Japan was suddenly hit by a 7.6 magnitude earthquake that completely disrupted the rhythm. This quake not only shook the foundations of Tokyo but also sent shockwaves through the global central banking landscape.

The market is pricing in an 87.4% probability of a rate cut, which seems like a sure thing. But here’s the issue—even if rates are cut this time, it might not actually be good news.

The current economic situation is extremely unusual: on one hand, employment data is weakening; on the other, inflation remains stubbornly high. “Stagflation” is no longer just a textbook term. If there’s rare internal disagreement within the Fed, or if Powell delivers a hawkish message alongside the rate cut—such as “the inflation fight isn’t over” or “future actions depend on data”—then market expectations for continued easing next year could collapse instantly.

This is the so-called “hawkish rate cut”: a sweetener on the surface, but a warning not to expect too much. When everyone is betting on a dovish stance, even a single hawkish remark can trigger a chain reaction.

More importantly, the impact of this earthquake in Japan is far beyond what anyone imagined. The USD/JPY shot straight past 155.97, and the Bank of Japan’s planned “historic rate hike” next week is now very likely to be postponed—post-disaster reconstruction will require massive funding, forcing a pause in the exit from the world’s last negative interest rate policy.

It’s not just Japan; central banks in Australia, Brazil, Switzerland, and several other countries have collectively entered wait-and-see mode this week. A wave of policy caution is spreading from Tokyo to Washington.

For the crypto space, if the Fed sends an unexpectedly hawkish signal in the short term, the $90,000 level for Bitcoin and $3,800 for Ethereum will become battlegrounds for bulls and bears. However, sharp drops often mean opportunity—liquidity expectations are only being delayed, not disappearing.

In the medium term, the global easing trend remains unchanged. After the volatility is digested, liquidity logic will still dominate. What really matters is the flow of funds from whales and ETFs—contrarian accumulation during panic is the strongest bullish signal.

On the operational side: spot holders should fasten their seatbelts and not be scared off by short-term swings; traders should lower leverage and wait for a clearer direction; DCA investors should prepare funds, as sharp drops are prime opportunities to build positions gradually.