Recently, there's an interesting observation — the December non-farm payroll data in the US is actually quite contradictory.

On one hand, indicators such as new jobs, job vacancies, and wage growth all show that the labor market is cooling down, in other words, companies' enthusiasm for hiring is waning. However, the unemployment rate has slightly decreased, which can be considered a rare positive signal. Combining these data points, the Federal Reserve currently has no urgent reason to cut interest rates — the market has already priced in holding rates steady in January, and the earliest possible rate cut might not happen until June.

But there's another variable. It is rumored that the Supreme Court is about to declare that the IEEPA tariffs pose a constitutional risk. If that happens, the economic outlook could marginally improve, and inflation pressures might ease. Although this is not good news for the fiscal deficit, market sentiment would lean towards optimism.

So, the current situation is: the Federal Reserve remains on hold, and tariff disruptions are gradually fading. Under this combination, US Treasuries are under significant short-term pressure, with a high probability of remaining at elevated levels. In contrast, the US stock market still shows strong AI sector activity, and with the decline in tariff risks, sectors like consumer staples and industrials, which were previously hit hard by tariffs, are showing resilience.

For crypto traders, this means the dollar's strength may persist, but the room for risk assets to recover is also expanding — a dual scenario that warrants close attention.