US stock markets experienced a significant upswing, marking their strongest four-day performance since May. The Dow Jones Industrial Average rose by 0.7%, closing at 47,427.12, while both the S&P 500 and Nasdaq Composite also gained 0.7% and nearly 0.8%, respectively. This rally comes just ahead of the Thanksgiving holiday, with markets anticipating a potential Federal Reserve rate cut in December.
Recent economic data indicating lower-than-expected retail sales and inflation has fueled investor optimism. Currently, market sentiment reflects an over 80% probability of a quarter-point rate cut during the Fed”s upcoming meeting. Additionally, initial jobless claims have decreased, reaching their lowest levels since April, highlighting unexpected resilience in the labor market.
In the cryptocurrency sector, Bitcoin traded above $90,500, yet concerns about the sustainability of this rally are emerging. Data from CryptoQuant indicates rising realized losses among investors, suggesting a trend of exhaustion rather than recovery. Large deposits into cryptocurrency exchanges have surged, indicating that significant holders are moving assets, which may signal potential selling pressure.
Similarly, Ethereum has shown a parallel trend with its deposit levels reaching their highest in nearly three years. This uptick in exchange inflows coincides with liquidity concerns within the crypto markets. Glassnode”s latest report highlights that realized losses are climbing to levels reminiscent of previous cycle lows, and the profit and loss ratio among short-term holders has drastically diminished, indicating limited buying momentum.
Meanwhile, gold prices also saw a rise, climbing above $4,170 as expectations of lower interest rates in the US increased demand for the precious metal. With the markets closed on Thursday for Thanksgiving and operating on a reduced schedule on Friday, traders will be closely watching developments that could affect both stock and cryptocurrency markets in the coming days.
