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Global markets showed signs of recalibration this week as U.S. equities extended losses, while Bitcoin surged past $97,000, driven by a substantial short squeeze and renewed institutional demand.
Equities Retreat Amid Sector Rotation
U.S. stocks declined for a second consecutive session, with the Nasdaq Composite falling 1% to 23,471.75. The S&P 500 dropped 0.53%, while the Dow Jones Industrial Average saw a marginal 0.09% dip. The pullback was led by technology stocks, reflecting investor concerns over elevated valuations and external pressures such as China’s new restrictions on U.S. cybersecurity software—a move affecting semiconductor leaders like Nvidia and Broadcom. This shift signaled a broader move away from growth-oriented tech toward more economically sensitive sectors.
Overseas markets displayed greater resilience, with Asian and European equities trading mixed to slightly higher. Optimism around AI applications and easing deflationary trends in key economies supported sentiment, highlighting a divergence between U.S. uncertainties and international catalysts. $BTC $ETH
Commodities and Currencies Reflect Cautious Tone #MWAM_Crypto
In commodities, crude oil prices fell nearly 3%, with WTI settling around $60.22 per barrel after geopolitical tensions eased. Precious metals moderated from recent peaks, with gold hovering near $4,610 per ounce. The U.S. dollar held stable against the euro, suggesting tempered forex volatility amid shifting risk sentiment. Bitcoin Surges on Short Squeeze and Institutional Inflows
In contrast, cryptocurrencies advanced, with the broader market up 0.89% over 24 hours and 4.86% over the past week. Bitcoin broke decisively above the $95,000 resistance level—a ceiling since December—reaching $97,000 amid heavy volume. The rally triggered $588 million in short liquidations, the largest since November 2025, accelerating upward momentum. Bitcoin’s Relative Strength Index now stands at 75.42, indicating overbought conditions as traders eye the $100,000 milestone. Simultaneously, institutional interest resurged strongly. Spot Bitcoin ETFs recorded $753.7 million in net inflows on January 13—the highest single-day total since October 2025. BlackRock’s IBIT alone attracted $391 million, underscoring Bitcoin’s growing role as a macro hedge rather than purely a speculative asset.
Market sentiment improved notably, with the Fear & Greed Index climbing to 54—moving from “Fear” to “Neutral”—an 11-point gain from the prior week. This recovery suggests increasing investor confidence, potentially broadening participation beyond Bitcoin into altcoins.
Analysis: A Pivot Point for Digital Assets
This period highlights a notable divergence between traditional equities and digital assets. While U.S. stocks, particularly in tech, undergo a correction, cryptocurrency markets are displaying maturity through institutional adoption and technical strength. Bitcoin’s breakout above $95,000 signals growing independence from short-term equity volatility and reinforces its position within diversified portfolios.
Sustainability will depend on Bitcoin maintaining support above $96,000; a break below could invite profit-taking. Yet, with strong technical momentum, steady institutional inflows, and improving sentiment, crypto appears poised to extend its rally—even as traditional markets navigate uncertainty. Source: Anndy Lian