BTC,ETH,SP500 Face Worst Quarter in 3 Years, $160B Wiped Out
1min read QCP's latest market analysis reveals a challenging start to the second quarter for BTC, ETH, and the S&P 500 Index, with all three recording their worst quarterly performance in three years. The cryptocurrency market has seen over $160 billion in value wiped out since last Friday, largely due to significant quarterly expiry trades that drove a sharp pullback. This sell-off was exacerbated by traders heavily selling at fixed rates, causing option funding to shift from neutral to negative.
Ask Aime: What's driving the recent decline in cryptocurrency values and the overall market performance, especially BTC, ETH, and the S&P 500?
Macroeconomic data also contributed to the market's weakness, with core inflation data coming in higher than expected, indicating stronger inflation in February despite subdued consumer spending. This data has added to the market's caution, as investors await the next potential catalyst. One such event is Trump's "Liberation Day" scheduled for April 2nd, where he is expected to announce a series of extensive retaliatory tariffs.
Consumer confidence has hit a 12-year low, leading to volatility in the stock market with weekly declines of 4% to 5%. Aggressive policies could further exacerbate recession concerns, potentially leading to a spiral sell-off of risk assets. The volatility index, VIX, remains high at 22, reflecting ongoing unease in the stock market. In contrast, cryptocurrency volatility has not been significantly affected by the sell-off, despite experiencing a similar decline and significant selling on Friday.
April has historically been a strong month for cryptocurrency, but the market is currently digesting a series of macro risks and awaiting clearer direction. Key events this week include the ISM data release, the nonfarm payroll report, and Powell's speech, all of which could provide the market with the catalyst it needs to move forward.
