Why are crypto and stocks suddenly rallying right now?
Stocks and crypto are pushing higher because traders are reacting to an upcoming Federal Reserve rate cut and a heavy week of Big Tech earnings.
S&P 500 futures rose 0.7%, Nasdaq 100 futures gained 0.9%, and Dow futures added 290 points, or 0.6%, during Sunday evening trading.
The rallies are coming after a week of strong gains across major indexes, and traders are now positioning ahead of the Federal Reserve’s October 29 meeting, where the market widely expects a rate cut.
According to the CME FedWatch Tool, 96% of investors are betting on rates being cut to 375–400 basis points, while about 3% expect the Fed to slow down and cut to 400–425 basis points instead.
This momentum is being paired with anticipation for third‑quarter earnings from the so‑called Magnificent 7: Alphabet, Amazon, Apple, Meta Platforms, Microsoft, and others. Investors are expecting strong numbers based on earlier Q3 releases across tech names.
Market reactions continue
The Dow Jones Industrial Average closed above 47,000 for the first time on Friday, ending the session at 47,207.12 after gaining 472.51 points, or roughly 1%.The S&P 500 finished at 6,791.69, up 0.79%, while the Nasdaq Composite climbed 1.15% to 23,204.87.
The move in the stock market spilled into crypto almost instantly.
About $160 million in crypto shorts were liquidated within the first 30 minutes of the stock futures open.
Bitcoin and Ethereum saw gains of 1.6% and 2.8% after officials signaled that two countries involved in ongoing tariff threats are unlikely to follow through on extreme tariff and export control actions.
But the rally comes after a violent pullback earlier this week, when Bitcoin, which had reached a $125,000 all‑time high, dropped 16% and briefly traded below $105,000. Many altcoins were hit even harder, dropping anywhere from 30% to 80%.
This decline forced leveraged traders to close positions, causing a $19 billion liquidation cascade across crypto markets. Even stablecoins were affected. USDC briefly slipped below $1, while USDT traded at a small premium.
Uptober was basically placed on ice. The phrase refers to October historically being a strong month for crypto performance. This year, some traders got caught assuming the same pattern would automatically repeat.
Meanwhile, traders are also watching U.S.–China trade developments. According to Disruptive Technology analyst Dan Ives, a broader trade deal is being discussed. Ives said, “It appears a much broader trade framework/deal could be on the table this week between US and China which would be a huge groundbreaking moment for the tech sector and markets.”
A stabilized trade environment would support Big Tech earnings and could push this stock rally even further.
Meanwhile, gold is crashing, as is in its nature. The price dropped to around $4,065 early Monday in Asia, down 1.10% for the day. Traders are locking in profits after a long record-breaking rally.
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