New York Stock Market Soars to All-Time Highs… Why is the Cryptocurrency Market Stagnant?

▲ New York Stock Exchange (NYSE), USA

Despite powerful macroeconomic tailwinds such as signs of easing geopolitical tensions in the Middle East and an unprecedented tech stock rally in the New York stock market, major virtual assets, including the leading cryptocurrency Bitcoin (BTC) and XRP (Ripple), continue to cautiously observe without finding a clear direction.

According to cryptocurrency market aggregator CoinMarketCap on April 25 (local time), the global virtual asset market capitalization recorded a mere 0.03% increase from the previous day, reaching $2.6 trillion, remaining strictly in a consolidation range. The leading cryptocurrency, Bitcoin, is trading at $77,635.35, down 0.45% from 24 hours ago, and the leading altcoin, Ethereum (ETH), is also down 0.36% at $2,317.80. XRP recorded a 0.32% drop to $1.43, while Solana (SOL) rose 0.89% to $86.59, showing overall mixed trends with extremely limited price volatility. The Fear & Greed Index, which indicates market investor sentiment, stands at 44, signaling a neutral phase.

This extreme caution in the crypto market is interpreted as a result of capital temporarily flowing strongly into the stock market, particularly the artificial intelligence and semiconductor sectors. Overnight in the New York stock market, expectations for a second ceasefire negotiation between the US and Iran emerged, and Intel announced better-than-expected earnings, leading the tech-heavy Nasdaq Composite Index and the S&P 500 Index to once again break all-time highs. Following news of an extended truce between Israel and Lebanon, speculation that high-ranking officials from both countries would meet in Islamabad also led to a stable decline in international oil prices.

Typically, when macroeconomic uncertainties are resolved and risk asset preferences revive, the virtual asset market also rallies. However, this time the atmosphere is quite different. As the stock market showed overwhelming returns, with Nvidia surpassing a market capitalization of $5 trillion and the Philadelphia Semiconductor Index rising for 18 consecutive trading days, liquidity that should have flowed into the crypto market was heavily absorbed by the New York stock market. This is why a clear buying trend has been absent, even though a favorable environment for the crypto market was created by the simultaneous decline in the dollar's value and US Treasury yields.

Experts predict that the tedious sideways trend in the virtual asset market could continue until the Federal Open Market Committee (FOMC) regular meeting scheduled for next week. While the US Department of Justice's investigation into Federal Reserve Chairman Jerome Powell has concluded, removing uncertainties surrounding the next leadership change, investors are reluctant to build aggressive positions until they confirm clear clues about the timing of immediate interest rate cuts. In the short term, a key observation point is whether the capital that has flowed into New York's tech stocks will rotate back into the crypto market after profit-taking.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*