It is surprising to conclude a week that hasn’t been marked by any crazy geopolitical headline or regime-changing event, yet markets were no less volatile.
After last week’s gigantic drop in Metals, a wave of anxiety took traders by surprise, who embarked on a deleveraging journey – As we’ve seen since October, the previously undefeated Tech/Software sector and Cryptocurrencies are taking a streak of gut punches.
That’s the particularity of high-volatility assets – standing at the extreme of the risk spectrum, they get battered a bit more than their more conservative counterparts.
Bitcoin and altcoins were the hardest hit by the recent market developments. The face of the digital asset Market corrected by more than 30% in a matter of three weeks of trading, reaching $60,000 in Thursday evening action. Quite a selloff.
But it seems we are indeed in the age of dip-buying, with prices bouncing back again today, $10,000 higher, and the mood not worsening much from the Thursday dips – Is this a dead cat bounce?
Can’t say for sure, as we are in uncharted waters; some previous corrections extended beyond 50%, but participants will gain more certainty as time goes on.
Nasdaq also lost beyond 7%, leading US Indexes to their weekly tumbles before recovering back to 25,000, despite record earnings and CapEx announcements. The latter is what investors could be punishing with AI taking its part in this week’s cloudy mood.
Artificial Intelligence is now feared to be causing the latest cracks in the mid-tier employment reports received throughout the week.
The Dow Jones was the star of the show, powered by strong outperformance from the Consumer Defensive, Industrial, and Financial sectors, casually reaching the 50,000 Milestone in the process!
The sudden rise in the Manufacturing PMIs also affected the flows!
