'Home Run' as Wall Street Hits New Highs – Bitcoin Rebounds, Ethereum Wraps Up Bullish Month
Wall Street's main indexes posted solid gains, wrapping up the final session of a blowout November with traders driving the market to new closing highs as the post-election rally continued.
Bitcoin followed suit, bouncing back after its recent slump, and now looks poised for further upside.
Ethereum closed out a bullish month, maintaining solid momentum despite some market uncertainties.
Midweek, stocks ended lower, with the Nasdaq leading the declines as tech stocks faced sharp losses.
The sell-off was triggered by persistent inflation concerns, fuelling speculation that the Federal Reserve may delay rate cuts to maintain its cautious stance.
The Fed's preferred inflation gauge, the Personal Consumption Expenditures (PCE) index, rose 2.3% year-over-year in October and 0.2% month-over-month.
Additionally, US unemployment claims fell by 2,000 to 213,000 last week, while the Q3 GDP report showed strong economic growth, with the economy expanding at an annualized rate of 2.8%.
Investors are betting on Trump’s pro-business policies boosting growth and profits, though concerns over inflation, slower Fed rate cuts, and global growth risks persist.
Traders are pricing in a 25-basis point rate cut at the Fed’s December meeting, but many on Wall Street expect a pause in January.
At the New York close, preliminary data showed the Dow Jones Industrial Average climbed 188.59 points or 0.42% to 44,910.65.
The Standard & Poor's 500 rose 33.60 points, or 0.56%, to 6,032.44, surpassing its intraday record high of 6,025.42 set on Nov. 26.
Meanwhile, the tech-heavy Nasdaq Composite gained 157.69 points, or 0.83%, to 19,218.17.
Large-cap technology stocks were mostly higher on Friday, with the "Magnificent Seven," led by AI chipmaker Nvidia and EV maker Tesla, gaining 2.2% and 3.7%, respectively.
Microsoft rose 0.11%, Apple increased 1%, Alphabet slid 0.2%, Amazon gained 1%, and Meta (formerly Facebook) rose 0.9%.
In bonds, crypto and commodities
The 10-year Treasury yield, which influences mortgage rates and other key loans in the US government bond market, settled at 4.17%.
The policy-sensitive two-year yield, which closely tracks Federal Reserve interest rate adjustment expectations, closed at 4.15%.
In the crypto universe, Bitcoin, the flagship cryptocurrency, which recently approached US$100,000 before retreating, briefly rose above US$98,000 but last traded around US$97,300 after an intraday range of US$95,405 to US$98,599.
Given the recent rebound, traders should watch Bitcoin's ability to hold above US$85,000 for confirmation of continued bullish momentum, especially if another rally propels Bitcoin toward or above US$100,000.
While this could present an opportunity for further gains, caution is needed for potential pullbacks that may affect the trend.
If there is any pullback, the support may initially be found at around US$85,000 to US$87,500, with additional buying interest likely near US$75,500.
This support structure could offer opportunities for traders to enter during price corrections.
While there are notable opportunities, caution is advised, as increased market volatility from renewed demand is expected.
Effective risk management and adaptable strategies will be key to navigating this volatility and capitalising on potential opportunities.
Meanwhile, Ethereum's bullish comeback locked in a stellar month, surging from an intraday low of US$3,572 to US$3,734 before closing at US$3,709.
Given the rebound, the path ahead remains bumpy, with a near-term cap seen around US$3,750 to US$4,000. Traders should reassess at this point.
These levels will determine whether the upward trend can continue or if consolidation will occur.
Any pullbacks will likely find support near US$2,900, with additional support in the US$2,300. Reassessment is recommended if these levels are tested.
Spot gold holds steady at US$2,658 per ounce, while silver closed at US$30.66.
In the energy sector, Brent crude, the international standard, closed at $72.94 and the US benchmark, West Texas Intermediate (WTI), settled at $69.30.
Meanwhile, in currencies, the US Dollar Index (DXY), which tracks the greenback against a basket of currencies, closed lower at 105.74 in New York.
The Eurodollar was 1.0576, and the British pound finished at 1.2724. The Japanese yen ended at 149.70, and the Australian dollar was at 0.6510.
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