Crypto beat stocks as AI trade unwinds

AI Stocks vs. Crypto: This Week the Market Picked a Side

AI stocks fell sharply this week. Across 30 tokenized AI stocks tracked on altFINS, the median drop was 12.9%, and only two names (IBM and Salesforce) finished higher. (See live performance here)

The top 50 cryptocurrencies were far steadier, with a median of −4.3%. Crypto’s own AI tokens actually rose: TAO, RENDER, NEAR and WLD gained a median 1.0%. (see live performance here)

What triggered it. The selling started with CoreWeave, the AI cloud provider that carries about $50B of debt. Its stock fell roughly 20% in three sessions. The cost of insuring its bonds against default hit a record, and credit markets priced in a better-than-60% chance of default within five years.

At the same time, a hotter-than-expected CPI report pushed Treasury yields higher. That makes debt-funded data-center buildouts more expensive and revives the question of whether AI spending will pay off.

The selling spread quickly. The chip index (SOX) fell 7.9% on the week, Dell and HPE each lost about 20%, and the Nasdaq fell 2.1% on Friday.

Crypto outperformed. Over one month, top-50 crypto is up a median 8.0% vs −2.5% for AI stocks. Crypto AI tokens are up a median 39% over the same period.

Many altcoins are bouncing from their support levels. Especially when there’s a robust support zone.

What makes a support zone robust? When multiple support levels line up together:

1) horizontal support

2) 200-day Moving Average (200 SMA)

3) Channel or Wedge support trendline

Also, in some cases, momentum is inflecting (MACD Histogram rising again) just as price nears that support zone.

FET is a good example. Price pulled back to the $0.19 horizontal support, 200-day Moving Average (200 SMA) and Channel support trendline.

FET Expert Trade Setup: Price pulled back to a critical level: $0.19 horizontal support, Channel up trendline, and 200 SMA, which makes that a robust support zone for a swing trade entry in Uptrend. Price could rebound back +15% - 30% to $0.22 (PT1) or $0.26 (PT2). Entry: $0.19. Stop loss at $0.174.

If you're looking for alts that are in Uptrend but have pulled back to 200 SMA and near their horizontal support, here's a custom market scan. Usually that makes for a solid support zone.

Or this market scan where we also added another condition: rising MACD histogram, which indicates bullish momentum inflection.

TIP: Save these custom scans for future reuse (click Edit Filter > Save As). Create an Alert to get notifications of assets that fit this trading strategy (click on alert bell icon on top).

SKY is among the scan results: approaching horizontal support and 200 SMA:

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