Are you panicking about the recent pullback?

To be honest, it's normal to feel uneasy seeing unrealized losses in your account. But think calmly – is this round of decline really a signal of a crash? Or is the main force deliberately creating panic?

UBS's latest report provides an interesting perspective: they believe that the recent sell-off in the U.S. stock market is basically over, and there may be a decent rebound by the end of the year. The logic is actually not complicated.

Last month, the AI sector was too hot, and with enough profits, funds naturally want to cash out, causing both the S&P and Nasdaq to drop. Now, both major indices have fallen near the 100-day moving average, which historically has often been a support level. More importantly, expectations for a rate cut by the Federal Reserve in December have returned, and the market's confidence in liquidity is being restored.

My personal opinion?

This is more like a "pullback." Institutions are using retail investors' panic to clear out the weak hands, making room for the upcoming rise. UBS predicts that the S&P 500 could reach 7000 points; although it's uncertain whether it can be achieved, there is indeed room for it. It is particularly noteworthy that those momentum stocks with high volatility and strong elasticity may suddenly explode in December.

What should ordinary investors like us do now?

Don't be in a hurry to cut losses. Selling in panic is the easiest way to miss subsequent rebounds; instead, you should be more patient near key support levels. Keep an eye on the Nasdaq 100's movements; if it stabilizes, it’s likely a signal for a rally—large funds in the cryptocurrency market are also watching its performance.

In addition, while the AI concept is undergoing a correction, funds may rotate to other tracks. The DeFi and DepIN sectors have been relatively quiet recently, so there might be rotation opportunities. In terms of positions, don't go all in at once; it's safer to allocate in batches. Don't wait until it really rises to chase the highs.

The correlation between the US stock market and the cryptocurrency market is becoming increasingly evident. If this wave of the US stock market indeed boosts risk appetite, Bitcoin and mainstream coins are likely to participate. It's time to reassess those oversold coins in your account.

If there is indeed a major pullback in December, which coins do you think are the most promising?