Wall Street entered the holiday spirit, kicking it off in grand style with stocks seeing a rally. According to reports, the S&P 500 surged by 0.73%, while the Dow Jones Industrial Average posted a modest 0.16% after previous losses. Nasdaq composite also surged by 0.98%, triggering heavyweights like Meta Platforms, Tesla, and Nvidia.
While investors were reveling in the gains, Bitcoin was posting up a less-than-impressive number. Bitcoin is trading at $94,500, shedding off $14,000 from the all-time high figure it inched on December 17. Bitcoin champion Microstrategy has also struggled in recent weeks, with its shares dropping around 8.8%. This is not surprising, seeing that the company rides hard for Bitcoin.
Microstrategy’s fate hangs on its billions in Bitcoin
Despite the Monday performance, Microstrategy’s year has been nothing short of wonderful. The company’s stock has risen 462% over the course of the year, with Bitcoin the major ingredient to it being one of the hottest stocks in the United States. The company began its adoption in 2020 and has now pooled about $43 billion into the asset. The crypto obsession has also shot the firm’s valuation from a tiny $1 billion to a monster $82 billion.
Now, the thing is that Microstrategy’s value will remain high as long as Bitcoin continues its ascent. Monday was a typical example of that theory, with Microstrategy dropping as hard as Bitcoin. Bitcoin also moved close to its 50-day moving average, a development that has caused traders nightmare. Now, investors will be wary about making risky bets, a bracket where Bitcoin, the king of speculation, reigns supreme. Even with President-elect Donald Trump pushing his pro-crypto agenda, the market is still quite unmoved about it.
Donald Trump’s Bitcoin crusade could provide support
Donald Trump’s victory at the polls created a whirlwind effect for Bitcoin, pushing the asset higher into the heavens. Since the election period, Bitcoin has surged 40%, as the market anticipates Trump’s pro-crypto policies. So far, he has made several appointments to that effect, even appointing a pro-crypto White House AI and Crypto Czar in David Sacks.
Bitcoin ETFs have also been performing well since the election, seeing massive inflows. Over $12 billion was poured into the investment vehicle, but things are beginning to cool off. The product saw its biggest one-day outflow on December 19, signaling that investors are taking a break. Microstrategy, on its part, has no room for breaks, announcing a big $561 million Bitcoin purchase. This represents the firm’s seventh consecutive week of purchases.
Meanwhile, the wider market has been following Bitcoin’s trend. Ethereum and Dogecoin have posted remarkable gains this year, but they’re still mirroring Bitcoin’s performance. A slim trading volume could be a recipe for volatility in the United States, with markets set to close early today. With the Christmas break expected to happen tomorrow, the market could be put in the hands of smaller traders for stabilization.
The post Wall Street rally shifts investor sentiment amid Bitcoin decline first appeared on Coinfea.