The market is "pricing in the risk of rate hikes," but it's far from reaching the stage of "a rate hike cycle has already begun."

All risk assets are pulling back, and the core issue is actually not sentiment, but rather macroeconomic conditions changing.

Oil prices have been sustained at elevated levels for the long term, inflation expectations are re-emerging, and this is the most damaging logic in the current market.

More importantly—the market is starting to re-price the possibility of rate hikes, rather than rate cuts.

Current rate expectations:
April rate hike 25bp probability: 12.4%
Cumulative 25bp rate hike by June probability: 21.9%
Maintaining rates unchanged remains mainstream (approximately 76.5%)

This indicates one thing: rate hikes are not the main theme, but have turned from "zero expectation" into "a risk that needs to be priced in."

And once the market begins pricing in rate hikes, it directly suppresses valuations (especially Nasdaq, tech stocks, AI concept stocks + Crypto).

Another overlooked point: the incoming Fed chairman won't take office until after June. Even with the change in leadership, it doesn't necessarily mean an immediate pivot to rate cuts.

Monetary policy has never been determined by one person, but rather by consensus under the long-term systematic operations of the entire Federal Reserve.