Tag Archives: weakness

Gold jumps 6.1 per cent to US$4,946 as geopolitical tensions override dollar weakness: What about Bitcoin?

Gold jumps 6.1 per cent to US$4,946 as geopolitical tensions override dollar weakness: What about Bitcoin?

Investors grew cautious about artificial intelligence potentially creating fiercer competition within the software sector, which kept sentiment fragile even as the partial United States government shutdown concluded late Tuesday after President Trump signed a funding agreement negotiated with Senate Democrats.

Meanwhile, the Reserve Bank of Australia made a decisive move by raising its key interest rate to 3.85 per cent from 3.60 per cent, marking the first major economy to tighten monetary policy this year after determining that inflation pressures remained stubborn enough to require renewed restraint. This divergence in global central bank approaches highlights an uneven economic landscape, with some regions facing persistent price pressures while others are preparing for easing cycles later this year.

United States equities retreated decisively, with the Dow Jones Industrial Average falling 0.34 per cent, the S&P 500 dropping 0.84 per cent, and the technology-heavy Nasdaq Composite declining 1.43 per cent. The selloff centred on software stocks following Anthropic’s release of Claude Co-work plug-ins, which amplified fears about competitive disruption in an already crowded artificial intelligence ecosystem.

Investors rotated capital toward economically sensitive sectors seeking broader exposure beyond concentrated technology holdings. This shift pushed the VIX Index to 18.00, its highest level in two weeks, signalling rising anxiety about near-term market direction. The uneven nature of the United States’ recovery suggests merit in considering alternatives to the standard S&P 500, such as an equal-weighted index or low-volatility strategies that provide more balanced sector representation while maintaining exposure to select cyclicals, such as financials and industrials, alongside defensive healthcare segments.

Treasury yields moved lower as the equity selloff gathered momentum, with the two-year note falling 0.2 bps to 3.570 per cent and the 10-year yield declining 1.2 bps to 4.265 per cent. This inverse relationship between stocks and bonds reflected a classic risk-off rotation, with investors seeking safety in fixed-income assets amid turbulence in the technology sector.

The move supports a strategic approach of extending bond duration to the five to seven-year range while accumulating high-quality investment-grade debt, particularly from developed and emerging-market sovereign and corporate issuers. These instruments offer attractive real yields in an environment where central banks may begin to ease later this year, though timing remains uncertain given persistent inflation dynamics in some economies.

Currency markets reflected subtle shifts in global risk appetite, with the United States Dollar Index declining 0.20 per cent to 97.437 as the greenback weakened against nearly all G10 counterparts. The euro strengthened to 1.1819 against the dollar, gaining 0.2 per cent, while the Japanese yen continued its struggle with USD/JPY, rising 0.1 per cent to 155.75.

This yen weakness stemmed from expectations of a strong election victory for Prime Minister Takaichi, which raised concerns about Japan’s fiscal sustainability and long-term debt trajectory. The broader dollar downtrend appears intact, with further Federal Reserve easing expected to dominate currency movements through the remainder of the year, potentially supporting additional gains in EUR/USD while pressuring USD/JPY lower on a broad dollar basis.

Commodity markets displayed sharp reactions to geopolitical developments, with Brent crude oil rising 1.6 per cent to settle at US$67/bbl after reports emerged that the United States Navy shot down an Iranian drone approaching an American aircraft carrier in the Arabian Sea.

This incident reignited tensions between Washington and Tehran, raising immediate fears of supply disruptions. Precious metals surged dramatically, with gold advancing 6.1 per cent to US$4,946/oz and silver climbing 7.4 per cent to US$85/oz. These gains reflected classic safe-haven demand as investors sought protection amid rising geopolitical risks and equity market volatility, though the underlying outlook for oil remains cautiously negative given structural supply dynamics.

Asian markets diverged positively from their Western counterparts, with regional indices gaining ground, lifted by the strength of precious metals and optimism surrounding a newly announced United States-India trade agreement. South Korea’s Kospi Index led regional advances with a remarkable 6.8 per cent jump, fuelled by a powerful rally in chipmaker semiconductor and memory chip-related stocks.

China’s Shanghai Composite added 1.3 per cent, while Taiwan’s TWSE closed 1.8 per cent higher, demonstrating resilience in technology manufacturing hubs despite weakness in United States tech shares. This divergence suggests regional markets may be pricing in different growth trajectories or benefiting from sector-specific catalysts that offset broader global risk aversion.

The cryptocurrency market declined 2.05 per cent to US$2.59T over 24 hours, primarily driven by a Bitcoin-led liquidation cascade that revealed the asset class’s tight correlation with traditional equities. Bitcoin’s drop below the psychologically critical US$74,000 level triggered a wave of forced closures on overleveraged long positions, with liquidations surging 149 per cent to US$263.49 million within a single day.

Ethereum dramatically underperformed, falling 24 per cent over seven days, which weighed heavily on the broader Layer 1 ecosystem, while the Fear and Greed Index plunged to 14, indicating extreme fear across digital asset markets. The 92 per cent correlation between Bitcoin and the S&P 500 underscores how macro liquidity conditions now dominate cryptocurrency price action more than idiosyncratic blockchain developments.

The near-term market trajectory hinges critically on whether Bitcoin can stabilise above US$74,000. A successful defence of this support level could catalyse a relief bounce toward US$77,200 to US$78,400, particularly if the United States spot Bitcoin ETF flow data shows renewed institutional accumulation.

Conversely, a decisive break below US$74,000 may accelerate selling pressure toward US$72,850, intensifying the current downtrend. The market exists in a fragile sentiment-driven state where technical factors like leveraged position unwinds interact with macro correlations, leaving little room for sector-specific catalysts to drive independent price action.

This confluence of factors paints a picture of markets navigating a delicate transition period. Technology volatility rooted in competition over artificial intelligence intersects with divergent global monetary policies and persistent geopolitical risks.

While US equities face headwinds from concentrated sector exposure, Asian markets show resilience, driven by semiconductor strength and optimism about trade deals. The cryptocurrency market’s sharp liquidation cascade ultimately reflects its current status as a risk asset tightly coupled to broader liquidity conditions rather than a diversifying alternative.

Investors would be wise to maintain balanced portfolios with quality fixed income allocations, defensive equity segments, and selective exposure to economically sensitive sectors, while carefully monitoring key technical levels in both traditional and digital asset markets. The path forward demands vigilance regarding central bank communications, earnings results, and geopolitical developments that could rapidly reshape risk sentiment across all asset classes.

 

Source: https://e27.co/gold-jumps-6-1-per-cent-to-us4946-as-geopolitical-tensions-override-dollar-weakness-what-about-bitcoin-20260204/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

Dollar weakness isn’t just a trend. It is reshaping global asset flows

Dollar weakness isn’t just a trend. It is reshaping global asset flows
Investors are navigating a landscape defined by uncertainty, muted risk appetite, and a growing divergence between headline optimism and underlying fragility. The Federal Reserve’s first policy decision of 2026 looms large, scheduled for 3AM Singapore time on Thursday, and markets have already begun pricing in cautious expectations.
This tension is underscored by a sharp drop in consumer confidence, which tumbled to 84.5 in January from 94.2 in December, the lowest reading since 2014. Such a precipitous decline suggests that households are increasingly wary of economic conditions, possibly anticipating labor market softness or broader financial instability. Compounding this unease is the rising probability of a partial US government shutdown, fueled by political friction in Minnesota, adding another layer of near-term volatility to an already fragile outlook.
Despite these headwinds, the baseline economic forecast remains cautiously optimistic. Real GDP growth for 2026 is projected at 1.7 per cent, supported by a confluence of fiscal stimulus, accommodative monetary settings, and regulatory frameworks designed to cushion against recessionary forces. This resilience appears unevenly distributed. The equity market’s mixed performance on Tuesday, with the Dow Jones down 0.83 per cent while the S&P 500 and Nasdaq rose 0.41 per cent and 0.91 per cent respectively, mirrors this dichotomy. A steep selloff in health insurers offset gains driven by anticipation around megacap earnings, revealing how sector-specific dynamics can override broad market narratives. In this context, overreliance on a narrow set of tech giants becomes a strategic vulnerability. Diversification into the S&P Equal Weighted or Low Volatility Index offers a more balanced exposure, while selective allocations to cyclicals like financials and industrials and defensives such as targeted healthcare segments can hedge against both slowdowns and unexpected rallies.
Fixed income markets reflect similar caution. Treasury yields moved in opposite directions on Tuesday, with the 10-year yield edging up two basis points to 4.23 per cent while the two-year yield dropped more than two basis points to 3.57 per cent. This flattening of the yield curve hints at investor skepticism about near-term growth prospects, even as longer-term inflation expectations remain anchored.
The recommendation to extend duration and accumulate high-quality fixed income, particularly in developed and emerging market investment grade, aligns with a defensive posture that anticipates further monetary easing. With two rate cuts still expected in the second and third quarters of 2026, bond investors are positioning for a pivot that will likely be triggered by labour market deterioration, even if delayed data obscures the full picture for now.
Currency markets tell perhaps the most compelling story of shifting power dynamics. The US Dollar Index plunged 1.28 per cent to close at 95.80, its weakest level in nearly four years. President Trump’s public indifference to the dollar’s slide only reinforced market perceptions that US policymakers may tolerate or even welcome a weaker greenback to support exports and ease debt burdens.
The euro surged to its highest level against the dollar since June 2021, while the yen rallied sharply, closing 1.27 per cent lower against the dollar at 152.19, buoyed by speculation of coordinated rate checks between Washington and Tokyo. This broad-based dollar weakness is not merely a technical development. It reshapes global capital flows and redefines asset attractiveness. For risk assets priced in dollars, including commodities and crypto, a falling DXY lowers entry barriers for foreign investors and amplifies returns when converted back into stronger currencies.
Speaking of commodities, Brent crude jumped 3.02 per cent to 67.57 dollars per barrel following a winter storm that paralyzed US Gulf Coast exports, illustrating oil’s persistent sensitivity to supply shocks. The structural outlook remains cautious, given ample global inventories and tepid demand signals. Gold, meanwhile, soared 2.4 per cent to a record 5,136.47 dollars per ounce, cementing its role as the ultimate hedge amid geopolitical strain and economic ambiguity. The metal’s ascent underscores a flight to safety that extends beyond traditional bonds, especially as correlations between gold and the total crypto market cap reach a striking plus 0.84. This unusual alignment suggests that both assets are increasingly viewed through the same lens, as alternatives to fiat systems perceived as unstable or manipulated.
In Asia, regional equities responded positively to the dollar’s retreat and improved global risk tone. South Korea’s Kospi led with a 2.7 per cent gain, powered by memory chip stocks, while Hong Kong’s Hang Seng and Japan’s Nikkei added 1.4 per cent and 0.8 per cent respectively. These moves highlight how emerging and developed Asian markets benefit disproportionately from dollar depreciation and liquidity expansion.
Against this backdrop, the crypto market’s modest 0.77 per cent rise over the past 24 hours and 0.92 per cent weekly gain appears understated but meaningful. The move is not driven by speculative frenzy but by two converging fundamentals. First, a PayPal survey released on January 28, revealed that 39 per cent of US merchants now accept cryptocurrency, with 84 per cent expecting mainstream adoption within five years. This is not just optimism. It is evidence of infrastructure maturing beyond trading platforms and into real commerce. Second, the dollar’s collapse below 96 creates a historically bullish macro setup for Bitcoin and other digital assets. When the DXY weakens, crypto often thrives, not as a tech stock proxy, but as a non-sovereign store of value.
The surge in perpetuals trading volume by 16.08 per cent and the turn to positive funding rates signal that speculators are returning, but this time with a foundation of utility and macro support. The question now is whether sustained merchant adoption can offset structural pressures like shrinking stablecoin supplies. If real-world usage continues to grow while the dollar remains under pressure, crypto may transition from a volatile satellite asset to a core component of diversified portfolios. The current moment, quiet as it seems, could mark the beginning of that shift.

 

Source: https://e27.co/dollar-weakness-isnt-just-a-trend-it-is-reshaping-global-asset-flows-20260128/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

Crypto in the danger zone: Technical weakness, low volume, and a critical support test

Crypto in the danger zone: Technical weakness, low volume, and a critical support test

January 22 delivered a compelling narrative of a global financial landscape in flux, where traditional equities soared on the wings of diplomatic optimism while the volatile realm of digital assets cooled significantly. The day was marked by a second consecutive session of gains for major US stock indices, a direct consequence of easing geopolitical tensions and a corresponding retreat of the US dollar. This confluence of factors painted a complex picture for investors everywhere, highlighting a clear rotation of capital back into regional markets and safe-haven commodities.

My view is that these events highlight a fragile market sentiment, heavily influenced by headline news and the immediate unwinding of risk positions. The market’s sharp positive reaction to President Trump’s reported “framework” deal over Greenland, which ostensibly cooled global tensions and averted a looming trade war with new European tariffs, reveals a nervous system quick to price in relief. This optimism was evident in the performance of the S&P 500, which advanced 0.55 per cent to close at 6,913.35, the Dow Jones Industrial Average, which rose 0.63 per cent (306.78 points) to 49,384.01, and the Nasdaq Composite, which gained 0.91 per cent to settle at 23,436.02. This movement was not without specific stock stories, as tech giants such as Nvidia, Microsoft, and Meta Platforms all ended higher, and Intel shares rose slightly ahead of their quarterly results. Conversely, Abbott Laboratories shares fell sharply, reminding us that company-specific fundamentals, such as the impact of higher prices on sales growth, always matter, even amid broader market rallies.

The easing of global tensions also had a palpable effect on commodities and currencies. The US dollar index was 0.5 per cent lower at 98.30, marking its biggest single-day fall in a month. This decline acted as a potent catalyst for gold, the traditional safe-haven metal, which soared to an all-time high, climbing above US$4,960 an ounce in the spot market. It is a classic market reaction: a weakening dollar and reduced global risk perception often see a surge in the appeal of the yellow metal. Concurrently, WTI crude futures fell below US$60 a barrel, declining more than two per cent to US$59.35, as the geopolitical risk premium that often elevates oil prices evaporated with news of the diplomatic breakthrough. The bond market remained relatively stable throughout, with the 10-year Treasury yield at approximately 4.25 per cent, little changed from the previous day’s close.

However, a different, more cautious mood permeated the digital asset ecosystem. While traditional assets rallied, the crypto market fell 0.64 per cent over the last 24 hours, extending a seven-day decline of 6.5 per cent. This divergence suggests a distinct risk-off environment within the crypto space, driven by specific structural concerns rather than immediate global headlines. My take is that the crypto market is currently grappling with a crisis of conviction, primarily stemming from large institutional players. The data is clear: spot Bitcoin ETFs recorded US$1.58 billion in net outflows this week, a powerful signal of institutional profit taking and reduced exposure. This consistent selling pressure is outweighing retail buying, creating a market that lacks a necessary institutional bid to support prices.

The lack of institutional support is compounded by a significant plunge in trading activity. Total 24-hour trading volume fell 32.8 per cent to US$98.43 billion, with derivatives volume down 37 per cent. This sharp drop indicates low trader conviction and reduced liquidity, making prices prone to slippage even on modest sell orders. In thin markets, downward moves are often amplified. Technically, the market is testing a critical support level at the 78.6 per cent Fibonacci retracement level of US$3.01 trillion global market cap. The RSI sits at 43.74, neutral but weak. The conclusion I draw is that this is not a broad market panic but a targeted period of consolidation rooted in institutional caution and evaporating volumes.

For holders, the immediate future hinges on whether these ETF outflows persist and if that crucial US$3.01 trillion support level can hold firm over the next 48 hours. The contrasting performance of traditional and digital markets on this day provides a fascinating study of how different asset classes react to unique combinations of macro and microeconomic pressures.

 

Source: https://e27.co/crypto-in-the-danger-zone-technical-weakness-low-volume-and-a-critical-support-test-20260123/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j