Why Crypto Is Crashing While the Stock Market Hits Records

The Next 48 Hours Could Decide Crypto’s Entire Year

Let me ask you something.

How is the stock market hitting an all-time high on the same day a crypto crash is underway?

You don’t want to miss this. Let’s just jump right in.

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Two Camps Right Now in the Market

One is pro economy. One is the economy is being killed.

On one side you’ve got the booming ISM manufacturing number, 54.0. Jobs were up. Every darn thing was up. “Business has never been better. The whole economy is just poised for takeoff.”

But here’s my point.

Yes, we’re at all-time high, but if you look at this S&P 500, it has really narrowed in on just a handful of stocks that’s driving this market. Most of that has been on the AI side of things.

Look at the risk asset side. It’s a completely different story.

How Soon Is Soon for a Recession?

The other side says it could happen today.

We’re drawing down inventory and the strategic petroleum reserve is starting to fade. That would be enough to push the already tenuous economy into a recession.

Right now we’re down closer to 90, 95 bucks a barrel. But if we’re at 125 and we stay there for two, three months, that’s about $5 a gallon, maybe a little bit over.

And that would be enough to push the fragile economy into recession.

What’s the Fed to do if this is once again a supply-driven inflation problem?

“I don’t think anyone comes to the rescue here.”

Exxon’s Warning

Exxon is now warning that oil prices could go as high as 160 a barrel in the coming weeks. That’s if reserves are depleted.

We’re going to find out very soon. If Trump doesn’t come to an agreement where the Strait of Hormuz is freed, do we see impact here in the US, maybe for the first time, around energy?

Especially in the summer months, this could put the US in a very precarious situation going forward.

The S&P Erases Losses and Surges

The S&P surges now to its highest level on record. 69 trillion, man. 69 trillion.

And again, this goes back into a very few number of stocks that are driving this.

You’ve got the Anthropic IPO coming soon. Likelihood is SpaceX right on its heels. Then OpenAI starts to put pressure into the market.

I just wonder how much liquidity is actually there.

Because more than half of the S&P 500 stocks are trading below their 100-day moving average.

So think about that right now. What are you trading? Are you FOMOing in at the top, or are you buying dips?

Bitcoin Just Broke Below 69

Bitcoin is now 13,000 down in the last 19 days. That’s wiping out 220 billion from its market cap.

730 million worth of positions have been liquidated just in the last 24 hours.

So where does the bleeding stop? That’s the real question.

88 bill erased from the total crypto market today. Have you guys ever seen a red chart like that? I don’t know that we’ve ever seen one quite like that outside of 10/10.

Bitcoin ETFs also hit their lowest and longest selling streak on record. And here’s the thing. Most of the time when you see that kind of movement, a lot of down days on the ETFs, it marks a bottom.

So is 67, 65 the bottom? Or do we slip under a 60K mark?

The Saylor Sale That Accomplished Nothing

Here’s an interesting take.

“It feels like the worst of both worlds. Sailor sells, so you rip that band-aid off, but his sell is so insignificant that you don’t really get to test liquidity in the market. He sold a complete rounding error worth of Bitcoin. But we’re dumping because people are like, oh my god, Saylor’s selling.”

They only sold 0.0004% of their Bitcoin. Literally.

So the overhang stays. What happens when he really sells a quarter of a billion in Bitcoin?

Is that the mega nuke that could take Bitcoin down dramatically? Nobody knows.

The Bull Case in the Wreckage

Tom Lee isn’t flinching.

He says strategy’s Bitcoin sale is classic bottom behavior. Fears over the sale and record ETF outflows are not structural threats, but signs that investors are selling during a market reset.

Right now fear is holding. Fear and greed at 27 on crypto.

Remember, we have been in the depths of fear and greed back in February. That was the last time we saw real action. Are we headed for that right now?

Two Crypto Deadlines in the Next 48 Hours

June 2nd: the Genius Act stablecoin comment period closes at the Treasury.

June 3rd: the Senate floor reopens to potentially push the Clarity Act forward.

And breaking news, the Clarity Act is now being added to the Senate legislative calendar, making it eligible for full Senate consideration.

Eligible is the key word. It doesn’t go to the floor automatically. This is how politics work. They have meetings about meetings to do meetings before they actually vote.

Senator Lummis has one thing to say. “We’re closer to a functioning digital asset market structure than ever before. So don’t flinch.”

The Bottom Line

Energy is the wildcard. The AI side is draining the liquidity that usually drives risk markets. And the regulation that could change everything is days from a real test.

This isn’t a fun week. But these guys are saying it’s a reset, and the market is saying we don’t know right now.

Here we go.

Don’t flinch.

Thanks for reading. See you in the next one :)

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