Bitcoin showed early signs of stabilization on Monday, rising about 1% to trade near the $77,000 level after a sharp weekend selloff shook crypto and broader risk markets. The modest rebound came as the U.S. dollar weakened slightly and market volatility continued to climb, creating a fragile and cautious trading environment.
Despite Bitcoin’s small recovery, overall sentiment across risk assets remains defensive. Volatility indicators are flashing warning signs, while crypto-linked equities extended losses in pre-market trading. Investors are still digesting the market impact of President Donald Trump’s decision on Friday to nominate Kevin Warsh as the next Chair of the Federal Reserve — a move that triggered widespread repositioning across financial markets.
Crypto Equities Under Pressure
U.S.-listed crypto stocks were among the hardest hit as selling pressure carried over into the new week. Strategy (MSTR), the largest publicly traded holder of bitcoin, fell more than 6% in pre-market trading as investors reduced exposure to leveraged bitcoin proxies. Galaxy Digital (GLXY) also dropped over 7%, reflecting broader weakness across crypto-focused investment firms.
Mining and AI-linked crypto companies saw similar declines. IREN and Cipher Mining both slipped around 4%, as falling bitcoin prices and rising volatility weighed on the sector. Coinbase (COIN), the largest U.S. crypto exchange, was also down roughly 4%, signaling that traders remain cautious about near-term trading volumes and retail participation.
The weakness in these equities highlights how closely tied crypto-related stocks have become to broader risk sentiment, especially during periods of policy uncertainty and elevated volatility.
Volatility Signals Rising Uncertainty
Market volatility continues to rise across asset classes. The CBOE Volatility Index (VIX), often referred to as Wall Street’s “fear gauge,” jumped 10% on the day, reflecting growing anxiety in equity markets. At the same time, crypto-specific volatility measures have surged even more sharply.
The Volmex implied volatility index climbed significantly over the past week, rising from around 40 to near 50. Implied volatility represents the market’s expectations for future price swings. Higher readings suggest traders are bracing for larger and more unpredictable moves ahead, rather than a quick return to calm conditions.
This surge in volatility explains why even modest price rebounds, such as Bitcoin’s 1% gain, are being treated cautiously by market participants.
Bitcoin Tracks Dollar Weakness
Bitcoin traded near $77,000 after briefly dipping as low as $74,500 on Saturday during the height of the weekend selloff. Analysts noted that the rebound coincided with a pullback in the U.S. dollar, reinforcing the inverse relationship between Bitcoin and the dollar that has been evident in recent weeks.
The U.S. Dollar Index (DXY), which measures the dollar’s strength against a basket of major currencies, eased back to around 97. Research has shown that when the dollar weakens, bitcoin often benefits as investors look for alternative stores of value or speculative opportunities. Monday’s price action appears to follow that pattern once again.
Pressure Across Commodities
The weakness was not limited to crypto markets. Precious metals remained under heavy pressure following last week’s historic selloff. Gold fell another 4%, trading near $4,700 per ounce, while silver slid roughly 4% to around $82 per ounce. The declines extended the damage caused by forced liquidations and crowded positioning unwinds in the metals market.
Energy markets also struggled. West Texas Intermediate crude oil futures dropped about 5% to $62 per barrel, reflecting concerns about slowing demand and tighter financial conditions.
Equities Show Tentative Stability
In contrast to crypto and commodities, U.S. equity index futures showed mild stabilization. Futures tied to the Nasdaq 100, tracked by the Invesco QQQ ETF, were down less than 1% in pre-market trading, suggesting some investors are selectively stepping back into equities after last week’s volatility spike.
Looking Ahead
While Bitcoin’s rebound offers short-term relief, the broader market environment remains fragile. Rising volatility, policy uncertainty around the Federal Reserve, and continued pressure on risk assets suggest that traders are still in risk-management mode. For now, Bitcoin’s ability to hold above recent lows may depend less on crypto-specific factors and more on macro trends particularly the direction of the U.S. dollar and global liquidity conditions.#Binance #SquareCreators