Bitcoin and US stocks declined last week as concerns over AI investments, rising interest rate expectations and market uncertainty affected investor sentiment. US stocks lost nearly $3 trillion in market value in a single trading session, while BTC price fell below $75,000 and briefly touched the $73,000 level.
The S&P 500 declined 2.7% for the week, while the Nasdaq fell 3.4%. Bitcoin ETFs recorded $1.28 billion in weekly outflows, while Ethereum ETFs saw approximately $365 million withdrawn.
The decline has raised concerns about whether the sell-off will continue this week. Investors are now watching US inflation data, Federal Reserve rate expectations and Nvidia’s upcoming earnings for further market direction.
Three factors contributed to last week’s decline in US stocks.
Investors are concerned that potential restrictions on AI data centre expansion could affect demand for chips and other technology infrastructure.
US election campaigns brought more attention to data centre construction, with candidates from both major parties raising concerns about its expansion.
These concerns affected semiconductor stocks. Micron fell 22%, Palantir declined 13%, while Oracle and AMD dropped around 11%. Nvidia also lost approximately 9%.
US employment data showed 165,000 new jobs in October, compared with expectations of 65,000.
The stronger jobs report increased concerns that the Federal Reserve could keep interest rates higher or consider another rate hike in December.
Higher interest rates can put pressure on technology stocks and other risk-sensitive investments.
Technology companies are investing billions of dollars in AI infrastructure, but investors remain uncertain about how quickly these investments will generate returns.
Concerns over borrowing costs and future profitability have increased selling pressure on AI-related stocks.
Bitcoin price is facing pressure from the broader market decline and continued withdrawals from crypto investment funds. Bitcoin ETFs recorded $1.28 billion in weekly outflows, their largest weekly withdrawal since June. More than $840 million left these funds on Thursday and Friday.
Ethereum ETFs also recorded approximately $365 million in outflows, marking their sixth consecutive week of withdrawals.
Bitcoin traded above $80,000 on Wednesday before falling towards $76,000 and briefly touching the $73,000 area. The decline also affected market sentiment, with the Crypto Fear and Greed Index falling to 29.
Bitcoin’s weekly candle closed near $74,851, below the $75,000 level and its 50-week moving average near $75,500.
The important levels are:
A weekly close below $73,500 could strengthen the bearish outlook. However, a recovery above $76,200 could improve short-term sentiment.
Markets could remain under pressure this week as investors wait for US inflation data and further signals from the Federal Reserve.
US CPI inflation data, scheduled for November 10, is expected to increase from 3.7% to 3.9%. If inflation comes in higher than expected, investors may increase their expectations of higher interest rates. This could put further pressure on US stocks and Bitcoin.
A lower-than-expected inflation reading could support a recovery. Investors will also watch Nvidia’s earnings on November 17 to assess demand for AI chips and the outlook for technology spending.
US CPI inflation will be the main event for financial markets. The reading could influence expectations for Federal Reserve policy and determine whether investors continue reducing risk.
Bitcoin’s ability to reclaim $75,000 and hold above $76,200 will also be important. A break below $73,200 could increase the possibility of further losses.
For now, both markets remain sensitive to interest rate expectations and concerns over AI investments. Whether the decline continues this week will largely depend on inflation data and how investors respond to it.
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