S&P 500 Sits 2.5% From a Record High Despite the Stock Market Crash
Despite last week's historic stock market crash, the S&P 500 has recovered and is now just 2.5% away from a new all-time high.
The benchmark index's remarkable recovery comes after an AI-driven selloff last week that caused one of the biggest wipeouts in S&P 500 history, with the Nasdaq Composite falling 5.5% on November 5. Despite this dramatic downturn, stocks have quickly regained much of their lost ground.
The rally continued despite October's CPI rising 0.4% month over month, above the expected 0.3%. Core prices also climbed 0.3% for a third straight month, yet falling oil prices helped offset some inflation concerns.
Market Divergence
While stocks have rebounded sharply, Bitcoin has struggled to keep pace, trading near $74,400—roughly 40% below its all-time high. Spot Bitcoin ETFs saw nearly $1.3 billion in outflows in early November, and NVIDIA's controversy has added pressure on tech stocks, keeping crypto traders cautious.
Bitcoin holds above the 200-Day MA. That's great news. It's not confirmed, yet. I'd much want to see a clear breakthrough above the following levels and then I'm turning an absolute incredible bull.
Fed Decision Looms
Traders now see an 87% chance of a Fed rate hike in December, which could significantly impact markets. Higher rates typically hurt non-yielding assets like Bitcoin more than profitable companies, and a stronger dollar from higher rates could add further pressure on crypto prices.
Bitcoin could first target its 50-day moving average near $82,000 if renewed ETF inflows strengthen the recovery. However, a clean break below the 200-day moving average (just above $73,000) would threaten the longer-term uptrend. The Fed's December decision may ultimately determine which scenario plays out.
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