Continuing recent patterns, even the most modest crypto gains were met with waves of selling on Thursday that sent bitcoin back to $88,000 after a rally above $93,000 just hours earlier.
The rally had begun Wednesday evening in the US after Nvidia ( NVDA ) calmed jittery markets with an earnings beat and rosy outlook. In addition to boosting battered crypto, the NVDA results sent the Nasdaq higher by more than 2%.
Equities are also quickly reversing their gains, with the Nasdaq now up just 0.3%. Even mighty Nvidia is trading flat after rising more than 5%.
Damaging sentiment at the macro level are continued ideas that the Fed so far looks unlikely to cut interest rates at its December meeting. The September employment report (released today instead of weeks ago due to the government shutdown) showed a much stronger than expected 119,000 jobs added that month.
Also on the line was leading hawk Cleveland Fed President Beth Hammack, suggesting that not only was buoyant inflation not a reason to cut rates, but high stock prices were also a concern. Market veterans will hear echoes of Alan Greenspan’s “irrational exuberance” speech from 1996. Stocks continued to rise strongly for four more years.
Hit harder than bitcoin was Ethereum’s ether which is now at nearly 4% over the past hour, perhaps weighed down by digital asset fund manager FG Nexus selling some of its holdings to buy back some of its battered stocks (down more than 95% from its summer peak).
A check of crypto-related stocks now finds heavy losses after opening gains. Michael Saylor’s Strategy ( MSTR ) is down another 4.7% and down 62% year-to-date to a new 52-week low of $178. Exchanges Coinbase (COIN) and Gemini (GEMI) are down 4% and 5%, respectively, and Stabecoin issuer Circle (CRCL) is down 3.5%.
