Asia Market Update: Bitcoin Dips Below $90K as Stocks Retreat Amid Delayed US Data

In Asia, Bitcoin has fallen below $90,000, marking a six-month low, as traders become cautious and await key US economic data that has been postponed due to a government shutdown. This situation has shifted market sentiment, leading investors to favor safer assets as they prepare for the delayed September nonfarm payroll report.

Key Takeaways

Bitcoin has declined to $90,190, down 5.1%, with other cryptocurrencies like Ether and XRP also seeing notable drops.
Concerns surrounding the US economy have shifted market expectations, reducing the probability of a December Fed rate cut.
Equities are showing weakness, particularly as investors wait for Nvidia’s earnings and gauge the AI trade's future.
Analysts note that recent market declines reflect common volatility rather than a fundamental change in crypto adoption.

Bitcoin

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Good morning, Asia! Here’s what’s affecting the markets today.

Bitcoin’s price slipped below $90,000 in Asia on Tuesday, reaching its lowest point in six months. This drop comes as traders look to minimize risk amidst a wait for crucial US economic data that has been delayed due to the ongoing government shutdown.

Investors are particularly focused on the upcoming September nonfarm payroll report expected Thursday. The prolonged shutdown has halted data releases, leaving uncertainty about the state of the world’s largest economy.

Market expectations for a rate cut by the Federal Reserve in December have significantly decreased—dropping to about 40% from over 60% earlier this month. This trend has led many investors to opt for cash and safer investments rather than high-risk trades associated with artificial intelligence and cryptocurrencies.

Market Snapshot

Bitcoin: $90,190, down 5.1%
Ether: $2,994, down 5.5%
XRP: $2.15, down 4.5%
Total Crypto Market Cap: $3.17 trillion, down 4.4%

This market adjustment has also impacted stocks. US equities closed with significant losses on Monday, with the S&P 500 and Nasdaq both dipping below important technical levels for the first time since late April. Traders are preparing for earnings announcements from major retailers and chip manufacturer Nvidia, compounded by the delay in job report releases.

Crypto Sentiment Dips as Traders Adjust Positions

Following this cautious sentiment, Asia’s markets also reflected a downturn. The MSCI Asia Pacific index (excluding Japan) fell by 0.7%, while Japan's Nikkei index dropped over 2%. This early retreat shows the apprehension investors are feeling ahead of both the US economic data and Nvidia’s earnings, which are seen as indicative of the AI sector's robustness, a main driver of this year's stock rally.

Bitcoin's price response mirrors this shift in market tone. The cryptocurrency has fallen below $90,000 as traders unwound positions based on expectations of aggressive monetary easing from the Fed, becoming increasingly wary of macroeconomic risks.

Gadi Chait, an investment manager at Xapo Bank, remarked that the current situation seems to unsettle newer traders more than seasoned investors. He noted that the downturn indicates a corrective phase, with leverage getting cleared and adjustments made to portfolios, rather than signaling a setback in the long-term growth story of cryptocurrencies.

“While some might look for specific triggers—whether it be lingering effects from October’s deleveraging or broader macro changes—the exact cause is largely secondary,” he explained. “Periodic declines are typical in this market. Those with experience recognize this trend: we have faced it before, and we will face it again.”

US Data Resuming Post-Shutdown, But Market Clarity Lacking

Analysts at Bitfinex echoed this sentiment, highlighting the seriousness of the recent market pullback. “This is statistically the third largest decline since 2023 and the second largest since Bitcoin ETFs were introduced by major US providers. It might soon be time to establish a local bottom.”

Nevertheless, equity sentiment remains fragile. Throughout this month, stocks have faced pressures as investors reevaluate whether the enthusiasm around AI has driven valuations too high, especially in light of slowing growth indicators and stubbornly tight policy. Nvidia’s earnings report on Wednesday is central to this discussion.

With the end of the record-long US government shutdown allowing data releases to resume, the economic landscape could soon gain clarity. However, the loss of this data has already pushed markets to navigate without complete visibility regarding certain economic aspects. Private surveys indicate signs of slowing growth, even while Fed officials remain cautious about rapid monetary easing.