Bitcoin and Ether tumble as Nasdaq's 5% plunge rattles risk assets

Bitcoin and Ether have both fallen sharply in recent days. The drop came as the Nasdaq suffered its worst daily decline in months, losing 5%. Analysts now link the crypto pullback to tightening financial conditions and shifting market expectations. The sell-off saw Bitcoin drop to around $58,000, while Ether fell to $1,507. These levels marked cycle lows for both assets. The decline coincided with a broader market downturn, as the Nasdaq plunged by 5% in a single session.

Stronger-than-expected US labour data reduced hopes for Federal Reserve rate cuts. This pushed the 10-year Treasury yield near 4.53%, adding pressure on risk assets. Investment firm Bitwise noted that Bitcoin often reacts before equities when liquidity conditions change.

Technical indicators also pointed to extreme conditions. The SSR RSI, a liquidity measure, dropped to 13, signalling oversold levels. Meanwhile, global M2 money supply grew to about $122.6 trillion over the past year, even as Bitcoin retreated from its $126,000 peak.

Bitcoin later recovered slightly, trading near $62,000. Analysts suggested the pullback reflected broader financial tightening rather than crypto-specific issues. The recent downturn highlights Bitcoin’s sensitivity to liquidity shifts and macroeconomic trends. With the Nasdaq’s sharp decline and reduced rate-cut expectations, crypto markets face continued pressure. Traders are now watching whether the oversold conditions will lead to a rebound or further losses.