The cryptocurrency market took a nosedive on Sunday evening. Bitcoin plunged to levels not seen since February burying the expectations for the colossal surge the BTC maximalists have been hoping for so long. Ethereum fell back to December prices. Bears are cheering, and nobody know under what tree are the bears hiding.
Bitcoin dropped 12% in 24 hours. It's down 20% week-over-week. Ethereum plummeted 21% in a day. It's lost 30% in a week.
Ethereum erased all its 2024 gains. It's now 3% lower than on January 1st. The CoinDesk 20 Index fell 12% in 24 hours.
The Bank of Japan might've kicked off this mess. They hiked interest rates last week. The yen shot up. The Nikkei stock index tanked.
Japan's woes spread to the U.S. The Nasdaq dropped over 5% in two days. Nasdaq futures are down 2.5% on Sunday evening.
The Fed also threw a curveball. They held rates steady but seemed iffy about a September cut. Markets had banked on that cut.
Traders aren't waiting for the Fed. They've priced in a 100% chance of lower U.S. rates in September. There's a 71% chance of a 50 basis point cut.
The 10-year Treasury yield has nosedived. It's at 3.75% Sunday evening. That's down from 4.25% a week ago.
The current yield is way below the fed funds target. The target sits at 5.25%-5.50%. Talk about a gap!
Markets are in full panic mode. The Nikkei's down another 6% early Monday. That's a 15% drop in three days. It's off 20% from its mid-July peak.