Crypto Carnage and Market Rebound — A Volatile Start to the Week

Hello traders, and welcome to Crazy Monday — a well-deserved title after the market chaos that unfolded late on Friday. What happened before the weekend could easily be turned into a Hollywood-style financial thriller, as traders around the world witnessed one of the most unusual and dramatic market reversals in recent months. Many analysts and traders are now calling it a pure case of manipulation, orchestrated for a select few to make millions in minutes — particularly on the crypto market, where the devastation was most severe.

So, what exactly happened? Late on Friday, just as European markets closed, Donald Trump posted a message on social media suggesting renewed tensions with China — mentioning trade problems, tariffs, and disagreements. Those comments immediately sent shockwaves through the markets. Stocks turned lower, oil dropped sharply, and the U.S. dollar reversed after a brief period of strength. But the biggest collapse happened on cryptocurrencies, where the market went into freefall. Millions of dollars in losses were recorded in minutes, and thousands of traders were liquidated, as their orders simply couldn’t be filled in time due to the scale and speed of the crash. The size of the move was so extreme that speculations began almost instantly — that a handful of well-informed whales might have exploited the event to profit from the chaos.

Over the weekend, traders were bracing for the worst, but on Sunday Donald Trump attempted to calm markets, assuring investors that the China situation is not as bad and that relations with Xi Jinping remain strong. This helped bring back some risk appetite — or at least soften the panic — allowing markets to open Monday in a risk-on mode. Futures opened in the green, though it’s worth noting that not all of Friday’s losses have been recovered, and prices across many markets still remain below pre-tweet levels.

On the currency market, the picture is mixed but generally constructive. We’re seeing a drop in the value of the Japanese Yen, signaling improving risk sentiment. The Australian Dollar is gaining alongside other European currencies, while the U.S. Dollar and Canadian Dollar are also showing strength — a somewhat unusual combination reflecting the current market confusion. On commodities, we’re witnessing a modest rebound in oil, though it’s not yet strong enough to reverse last week’s damage. Meanwhile, metals are holding firm, with copper pushing significantly higher, signaling improving industrial optimism.

Looking ahead, today’s macro calendar is extremely quiet. With U.S. banks closed for Columbus Day, liquidity will be lower, and major movements are unlikely. That means traders will have time to digest the chaos from Friday, watch how sentiment develops, and prepare for the busier week ahead, where volatility could easily resurface.

Source: https://www.axiory.com/analytics/market-news/crypto-carnage-and-market-rebound-a-volatile-start