The Bank of Japan might make a big announcement this week.

If Kazuo Ueda directly raises the interest rate from 0.50% to 1.00% next week (although the market estimates the probability is less than 19%), the chain reaction could be very stimulating:

USD/JPY could drop directly to the 145-148 range, with the yen potentially rebounding violently by 8-12% in a single month. The US 10-year Treasury yield could jump by 30-40 basis points. Bitcoin? In the short term, it might retest 75k-78k, and just liquidation of contracts could start at $500 million to $800 million.

The Nikkei 225's weekly maximum drawdown could reach 8-14%, and a synchronized 4-7% correction in the Nasdaq isn’t impossible.

Now, the yield on Japan’s 10-year government bonds has already approached the psychological threshold of 2%, and funds engaged in carry trades are already starting to withdraw. On December 19th, a casual comment from Kazuo Ueda could determine whether the global liquidity will rise or fall this Christmas.

The market is now just waiting to see how the Bank of Japan will play its hand.