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This week’s spotlight shifts to a broad rebound in risk assets, led by equities reclaiming critical technical levels and crypto showing renewed strength at major inflection points. With the S&P 500 back above its 50-day moving average and gold pushing to fresh year-to-date highs, markets are responding positively to improving liquidity conditions and expectations of continued policy easing. As we move deeper into Q4, risk appetite is recovering, but remains highly sensitive to credit conditions and macro data.

Here’s what we’ll cover today:

Let’s dive in 👇

The S&P 500 has reclaimed a crucial technical level, trading back above its 50-day moving average after briefly dipping below it earlier this month. This rebound suggests the recent pullback was more likely a healthy consolidation than the beginning of a deeper correction. The key now is whether equities can maintain this level in the coming sessions, as its role as widely watched support will determine if the year-end rally can continue or if renewed downside risks emerge.

Gold has also shown exceptional strength throughout 2025, recording gains in nearly every month of the year. Strong central bank accumulation, persistent inflows into gold-backed ETFs, and the Federal Reserve’s ongoing easing cycle have all contributed to the metal’s resilience. Gold’s consistency reinforces its relevance as both an inflation hedge and a portfolio stabilizer, particularly at a time when geopolitical and macroeconomic uncertainties remain elevated.

On the policy front, swaps traders are now pricing in nearly 100 basis points of rate cuts by December 2026, reflecting expectations that the Federal Reserve will maintain a gradual easing trajectory. This outlook implies confidence in a soft-landing scenario, where economic conditions cool just enough to justify lower rates without tipping the economy into recession. For risk assets, this “Goldilocks” environment remains supportive, though any surprise in upcoming inflation data could quickly challenge market assumptions.

Bitcoin’s behavior continues to confirm its high-beta relationship to macro risk, maintaining a strong inverse correlation to U.S. credit spreads over the past two years. When credit spreads widen, signaling rising financial stress, Bitcoin tends to sell off alongside other risk assets, contradicting the narrative of BTC acting as “digital gold” during turbulence. With high-yield spreads rising toward roughly 3.01% and investment-grade spreads near 0.85%, credit conditions have been stressed since early October, aligning with Bitcoin’s decline over the same period. As seen during the carry trade unwind, the tariff tantrum, and the move from October 6 to today, Bitcoin has historically dropped between 30% and 35% during episodes of credit stress, reinforcing that it trades as a very macro-sensitive asset.

The current environment demands vigilance rather than complacency. While improved equity technicals and a continued Fed easing path provide a supportive backdrop, Bitcoin’s tight link to credit conditions highlights how fragile risk appetite remains.