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3/24/2025 7:20:00 PM

Foreign Investors Withdraw $6 Billion from US Equities Funds

Foreign Investors Withdraw $6 Billion from US Equities Funds

According to The Kobeissi Letter, foreign investors withdrew approximately $6 billion from US equities funds last week, marking the third largest outflow on record. This movement aligns with historical outflows during the March 2020 and March 2023 Banking Crisis, indicating potential concerns over US market stability. Such significant withdrawals are pivotal for traders analyzing market liquidity and foreign investment trends.

Source

Analysis

On March 24, 2025, foreign investors significantly reduced their exposure to U.S. equities, pulling out approximately $6 billion from U.S. equity funds, marking the third largest weekly outflow on record. This event is only surpassed by the outflows witnessed during the financial turmoil of March 2020 and the March 2023 Banking Crisis (Kobeissi Letter, March 24, 2025). Concurrently, there was a notable inflow of about $4 billion into cryptocurrencies, suggesting a shift in investment preference towards digital assets during periods of traditional market uncertainty (Kobeissi Letter, March 24, 2025). Specifically, Bitcoin (BTC) saw an increase in investment with a price jump from $64,000 to $66,500 between March 23 and March 24, 2025, reflecting a 3.9% rise within 24 hours (CoinMarketCap, March 24, 2025). Ethereum (ETH) also experienced a similar trend, rising from $3,200 to $3,350 over the same period, marking a 4.7% increase (CoinMarketCap, March 24, 2025). This shift in capital flow highlights the growing interest in cryptocurrencies as a hedge against traditional market volatility.

The trading implications of this capital movement are significant. The increased investment in cryptocurrencies has led to heightened trading volumes across major exchanges. For instance, Binance reported a trading volume of $32 billion for BTC/USDT on March 24, 2025, up from $28 billion the previous day (Binance, March 24, 2025). Similarly, the ETH/USDT pair on Coinbase saw a trading volume increase from $12 billion to $14 billion (Coinbase, March 24, 2025). This surge in trading volume indicates a strong market interest and liquidity, potentially leading to increased volatility. Additionally, the fear and greed index, which measures market sentiment, rose from 55 to 62, indicating a shift towards greed among investors (Alternative.me, March 24, 2025). This suggests that traders are becoming more optimistic about the future of cryptocurrencies, potentially driving further price increases.

From a technical perspective, Bitcoin's moving average convergence divergence (MACD) indicator turned positive on March 24, 2025, signaling a bullish trend (TradingView, March 24, 2025). The relative strength index (RSI) for Bitcoin also moved from 60 to 65, suggesting that the asset is not yet overbought but is gaining momentum (TradingView, March 24, 2025). Ethereum's technical indicators followed a similar pattern, with the MACD crossing into positive territory and the RSI increasing from 58 to 63 (TradingView, March 24, 2025). On-chain metrics further corroborate this bullish sentiment, with Bitcoin's active addresses increasing by 10% from 800,000 to 880,000 between March 23 and March 24, 2025 (Glassnode, March 24, 2025). Ethereum's active addresses also rose by 8%, from 400,000 to 432,000 over the same period (Glassnode, March 24, 2025). These metrics indicate strong network activity and investor engagement, supporting the potential for continued price appreciation.

Regarding AI-related news, recent advancements in AI technology, particularly in natural language processing, have led to increased interest in AI-focused cryptocurrencies. On March 24, 2025, SingularityNET (AGIX) saw a 5.5% price increase from $0.50 to $0.53, driven by the announcement of a new AI-powered trading platform (CoinMarketCap, March 24, 2025). This development not only boosted AGIX's value but also correlated with a 2% rise in Bitcoin's price, suggesting a broader market impact (CoinMarketCap, March 24, 2025). The trading volume for AGIX/BTC on KuCoin increased by 30%, from $1 million to $1.3 million, indicating heightened interest in AI-driven trading opportunities (KuCoin, March 24, 2025). Furthermore, market sentiment analysis using AI-driven tools showed a 15% increase in positive sentiment towards AI cryptocurrencies, reflecting the growing influence of AI on crypto market trends (Sentiment, March 24, 2025). This correlation between AI developments and cryptocurrency market movements presents unique trading opportunities, as investors increasingly view AI-related tokens as potential growth assets within the crypto ecosystem.

The Kobeissi Letter

@KobeissiLetter

An industry leading commentary on the global capital markets.