Bitcoin reached $67,000 on Friday, rising 5.7% to its highest price in over a month.
U.S. Stocks
Stocks fell on Friday as Wall Street ended a week marked by a rotation from large-cap stocks to smaller names.
The S&P 500 fell 0.71%, closing at 5,505. The Nasdaq Composite slipped 0.81%, ending at 17,726.94, and the Dow Jones plummeted 377.49 points, or 0.93%, to 40,287.53.
Friday’s action marked another broad decline, with the Russell 2000 index falling 0.63%. However, the shift to names perceived to benefit more from potential Federal Reserve rate cuts, such as smaller-cap stocks, seemed to persist throughout the week.
The S&P 500 and Nasdaq dropped 1.97% and 3.65%, respectively, marking their biggest weekly losses since April. On the other hand, the Dow rose 0.72%, while the small-cap-focused Russell 2000 increased by 1.68%.
Glen Smith, Chief Investment Officer at GDS Wealth Management, said, “Investors are pulling money out of well-performing large-cap tech stocks and redirecting it to other market areas.”
This has encouraged some Wall Street experts concerned that the market’s recovery was becoming too reliant on a few large tech stocks. Increasing optimism about upcoming Fed rate cuts has bolstered smaller and more cyclical names.
The departure from mega-cap companies, which have benefited from artificial intelligence, is why the Nasdaq underperformed this week. Similarly, the information technology sector led the S&P 500’s decline with a 5.1% drop.
CrowdStrike shares fell 11.1% after a major IT outage affected global operations. Both the New York Stock Exchange and Nasdaq reported that trading appeared unaffected.
Bitcoin and Altcoins
BTC’s price surge may result from several key factors, such as the anticipation of rate cuts, alleviating market fears.
“The main factors leading to recent lower prices were Germany’s Bitcoin liquidation and Mt. Gox FUD. However, this seems poised to change soon,” said Greg Magadini, Director of Derivatives at crypto analytics firm Amberdata.
The excess supply from Germany’s seized Bitcoin sales appears to have ended last week as the country’s treasury ran dry. Additionally, Mt. Gox creditors are expected to receive repayments within the next 7 to 14 days.
Magadini noted that a significant reason for the potential crypto price rise is the certainty forming around Fed rate cuts. CME traders indicate a 98% chance that the U.S. central bank will cut rates in September.
Bitcoin’s price increase follows a period of tension. Earlier this month, it dropped to a low of around $54,000. While Bitcoin is only up about 3% on a monthly timeframe, the largest asset by market cap has climbed more than 18% over the past two weeks.
Altcoins surged yesterday.
Leading the rally were memecoins Bonk (BONK) and Mog Coin (MOG), which jumped 20% and 15%, respectively. On a weekly timeframe, both projects have also recorded profits of up to 40%.
Arweave (AR) and Sei (SEI) were also standout altcoin performers of the day, rising over 10%.
Other projects in the top 100, such as Fantom (FTM), Jupiter (JUP), Brett (BRETT), JasmyCoin (JASMY), Floki (FLOKI), The Graph (GRT), Solana (SOL), Helium (HNT), NEAR Protocol (NEAR), Optimism (OP), Artificial Superintelligence Alliance (FET), Notcoin (NOT), Bittensor (TAO), ORDI (ORDI), Sui (SUI), Flow (FLOW), Aptos (APT), Dogwifhat (WIF), Immutable (IMX), Gala (GALA)… increased by 5-9%.
Ethereum (ETH) bulls continue their efforts to push the price above $3,500.
However, after hitting a local peak at $3,540, momentum has waned, and ETH is currently trading around $3,485.
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