Market Update – Week of November 14: Risk Assets Decline Amid Data Vacuum & Shifting Rate Expectations

Market Overview - Financial markets are experiencing volatility due to unusual data scarcity, with the Nasdaq Composite down 2.3% and Bitcoin falling below $90,000, indicating a broader risk-off sentiment rather than sector-specific issues [1] - The market-implied probability of a December Federal Reserve rate cut has decreased sharply from approximately 70% to around 50% without new communications or significant economic releases [2] Employment Data Uncertainty - The October employment report may not be released, and the November report remains unconfirmed, creating an informational void for investors [3] Digital Asset Market Dynamics - In the cryptocurrency market, large Bitcoin holders have distributed over $20 billion worth of coins in the past month, leading to significant supply pressure [4] - Digital asset exchange-traded products (ETPs) have seen $1.4 billion in net outflows over the past week, totaling $2.6 billion in redemptions over three weeks, marking the largest drawdown since March 2025 [4] On-Chain Metrics - Daily realized value in the Bitcoin market has consistently exceeded $3 billion over the past week, with over 500,000 BTC dormant for five years or longer being moved in 2025 [5] - A record 123,600 BTC from wallets inactive for over a decade has also been mobilized [5] Risk Concentration - The current market structure shows vulnerabilities, with short-term holders (those who acquired Bitcoin within the past 154 days) facing unrealized losses at the $96,000 price level [6] - Approximately 75% of long-term holders remain profitable, but the concentration of losses among recent buyers poses a risk for accelerated selling if sentiment worsens [6] Historical Context - The current drawdown in the digital asset market is moderate by historical bull market standards, but the composition of holders, skewed towards recent entrants with shallow conviction, requires monitoring as a near-term risk factor [7]