Snapback or Fakeout? Why This Rally Won’t Last, Even After Yesterday’s Surge
It’s been a wild few days. Bitcoin flushed into the mid-70s, S&P 500 sold off hard, and then yesterday—boom—markets ripped higher. Bitcoin jumped close to $10,000 off the lows, and S&P bounced sharply. Now you’ve got people saying the bottom’s in and we’re off to the races again.
Personally, I’m not convinced, especially after seeing the price action today. This feels more like a reflex move than anything else. A quick snapback after a steep drop, triggered by a headline—not a shift in the bigger trend.
Before I continue my analysis, I need to clarify that I'm buying stocks. My bias might be bearish, but that doesn’t mean I’m selling. I bought stocks last week and even yesterday, before that Trump tweet was posted. I also maintain a 5% Bitcoin allocation to have exposure to crypto.
Snapback ≠ Strength
When I look at the S&P 500 chart, I see a market that got pushed too far too fast, and then reacted to any excuse to bounce. That’s normal. After a strong drawdown, any small bit of news—any pause or pivot—can trigger a rally. But that doesn’t make it healthy. Structure still looks weak. We’re still seeing lower highs, broken supports, and not much clarity going forward.
The reason we got here hasn’t been resolved. Yesterday’s announcement didn’t fix anything—it just paused things. There’s no deal in place. Tariffs are still active, especially with China sitting at 145% while most others remain at 10%. That’s not the kind of situation where money floods back in with confidence. If anything, this kind of backdrop pushes people into wait-and-see mode. A little more cash-heavy. Less eager to commit.
Still a Downtrend
Let’s not forget—Bitcoin is still trending down too. For me, the recent breakdown below 81K was important. Once that gave way, the market moved lower fast. And that confirmed my view that we’re still in a broader decline. I sold my Bitcoin position around $79,500 and I’ve stuck with that.
I’d rather give up some upside here than be caught if this bounce fails. For me, the charts still show weakness. We could absolutely see a move back to $85,000 before rolling over again. Big drops are followed by sharp rallies, then evolve in more downside.
If Bitcoin does break back above 88,500 with strength, I’ll reassess. That would tell me something's changing. But until that happens, I’m leaning defensive with a smaller position and more patience.
Altcoins Still in Bitcoin’s Shadow
On the altcoin side, it’s more of the same. A few names had decent bounces in the last couple days—brief moments of strength—but they’ve mostly reversed already. In fact, all the altcoins I’ve owned throughout this four-year cycle are well below my selling point.
None of them are outperforming. Everything is still heavily tied to Bitcoin. So until BTC shows sustained strength, I don’t see much to do in the altcoin space. That’s fine. It’s part of the process. But it’s also a signal to not get overly aggressive.
Remember—you don’t need to chase every bounce.
Thanks for reading!
Written by Timothy Assi, an Elite Popular Investor on eToro.
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