QCP Capital: Market Focused on Tonight's Non-Farm Payrolls Report, Stage Set for Short-Term Rebound

On April 4th, QCP Capital announced on its official channel that Trump declared a 10% tariff on all imported goods this Wednesday and imposed "reciprocal tariffs" on countries with a significant trade deficit with the United States. The market responded quickly. Bitcoin fell sharply from an intraday high of $88,500 to $81,200, wiping out previous gains and triggering a large-scale cryptocurrency market liquidation. More than $221 million of long positions were liquidated, and Bitcoin was more severely affected compared to Ethereum. As was anticipated, risk assets across the board saw a sell-off. U.S. stock index futures led the decline, with S&P 500 futures dropping by 3.38% and Nasdaq 100 futures plunging by 4.28%. The selling pressure continued into yesterday's U.S. stock trading session. American Eagle Outfitters and other consumer stocks plummeted by 17.47%, reflecting investors' concerns about exposure to the Asian supply chain. With the key macro risk event unfolding, market attention shifted to tonight's non-farm payroll report. Investors are on guard for signs of weakness in the U.S. labor market. If the data fails to meet expectations, it will strengthen the case for further Fed rate cuts this year as policymakers try to cushion the economic slowdown. As of the time of writing, the market expects four rate cuts in 2025 (25 basis points each in June, July, September, and December). In the options market, exchanges noticed a sustained high short-term volatility, resulting in a surge in downside protection demand. This difference highlights the current market sentiment: uncertainty and a cautious outlook prevail. However, with positions already light and risk assets generally oversold, the stage may be set for a short-term rebound.