S&P 500 Nears Record High While Bitcoin Sits 40% Below Its Peak

The S&P 500 has clawed back almost everything it lost. The index is up 3.65% this week and now sits just 2.5% away from a new all-time high, according to BeInCrypto. That recovery lands a single week after one of the biggest wipeouts in S&P 500 history — a selloff on November 5 that slammed the Nasdaq Composite down 5.5%.

The rally came despite inflation running hot. October's CPI rose 0.4% month over month, above the 0.3% economists expected, while core prices climbed 0.3% for a third straight month. Traders responded by pricing an 87% chance of a Fed rate hike in December. Falling oil prices softened some of the inflation sting, and investors appear to have bought the dip in AI and chip stocks.

Bitcoin is stuck on the sidelines. BTC trades near $74,400, roughly 40% below its all-time high, and spot Bitcoin ETFs bled nearly $1.3 billion in outflows in early November. NVIDIA's controversy also weighed on tech stocks, keeping crypto traders cautious.

A record-breaking S&P 500 could pull buyers back into crypto, per BeInCrypto. Under that path, Bitcoin's first target would be its 50-day moving average near $82,000, with renewed ETF inflows strengthening the recovery. One trader quoted by the outlet wants to see clean breaks above $75,000, $77,200 and the 21-day moving average before calling $100,000.

Rate-hike fears still dominate the other direction. Higher rates typically hurt non-yielding assets like Bitcoin harder than profitable companies, and a stronger dollar could pile on more pressure. In that scenario, Bitcoin could test its 200-day moving average just above $73,000 — and a clean break below that level would threaten the longer-term uptrend.

For now the gap between stocks and crypto stays wide, and the Fed's December decision may settle which scenario plays out.