Tech Stocks, Crypto, and Gold Slump; U.S. Equities Break Key Support Amid Broad-based Sell-off

On Monday, November 17 (local time), a sharp sell-off swept U.S. financial markets, hitting nearly all asset classes from high-flying technology stocks to cryptocurrencies and gold. Heightened concerns over the sustainability of the AI boom and the economic outlook prompted investors to shed risk assets, driving major indices below key technical support levels and sharply increasing safe-haven sentiment.

Latest market developments show the S&P 500 and Nasdaq Composite both closed below their 50-day moving averages for the first time in 138 trading sessions, breaking the longest winning streak since May. The Dow Jones Industrial Average recorded its worst three-day performance since April, closing down 1.2%, or 557 points, on Monday. The Nasdaq fell 0.8%, and the S&P 500 declined 0.9%.

The sell-off extended beyond equities. Gold futures, viewed by some analysts as speculative assets, retreated to USD 4,068.30 per troy ounce. Spot gold fell toward the USD 4,000 level.

Cryptocurrencies were similarly hit hard. Bitcoin fell below USD 92,000, turning its year-to-date gains negative. Panic in markets pushed the CBOE Volatility Index (VIX) to its highest level since April, underscoring rising investor anxiety.

Investor nervousness intensified ahead of key events. Nvidia is set to release earnings this week, seen as a barometer of AI chip demand; September employment data, delayed by the government shutdown, will also be published. Meanwhile, markets have grown wary of tech giants’ reliance on large-scale debt issuance to fund capital expenditures, and continuing uncertainty over Federal Reserve interest-rate policy has contributed to the current broad-based sell-off.

U.S. equities break key technical levels, AI enthusiasm cools

Monday’s decline marked an important technical signal for U.S. equities.Nearly all major indices fell below critical support: the S&P 500, Dow Jones, and Nasdaq broke under their 50-day moving averages, while the RTY index fell below its 100-day moving average. Technical analysts often interpret breaks of such moving averages as signals of potential short-term trend reversals.

Technology stocks were the epicenter of the sell-off. Although Berkshire Hathaway disclosed increased holdings in Alphabet, lifting the stock by 3.1%, this failed to lift the broader sector. Apple fell 1.8% after Berkshire reduced its stake. Most of the “Magnificent Seven,” including Nvidia, Meta, and Amazon, declined. AI server suppliers such as Super Micro Computer and Dell Technologies, as well as Oracle and CoreWeave, also saw their share prices fall.

Data indicate that indices tracking large-cap tech stocks dropped to the lowest closing level in nearly a month. The “most shorted stocks” index also fell to a two-month low, signaling weakening confidence in previously popular names. S&P 500 breaks key level—6,725 points; market faces 10% correction risk

The S&P 500 not only broke its closely watched 50-day moving average but also fell below 6,725 points. Analysts are concerned the decline could evolve into a broad correction of at least 10%.

Goldman Sachs’ Lee Coppersmith previously noted that a break below 6,725 could prompt commodity trading advisor (CTA) trend-following funds to shift from buyers to sellers.

John Roque, head of technical analysis at 22V Research, pointed to “ugly” signals in the Nasdaq Composite. He noted that more constituents have hit 52-week lows than 52-week highs, an indication of internal weakness that suggests limited prospects for a rebound. Roque expects the Nasdaq to extend its slide, potentially by as much as 8%.

Deteriorating market breadth has amplified analyst concerns. Dan Wantrobski, technical strategist at Janney Montgomery Scott, said: “Market breadth is very poor, and equities are in a vulnerable position.” He forecasts a 5% to 10% pullback in the S&P 500 by the end of December.

Credit market alarms sound, Amazon bond sale cools. Weakness in equities coincided with mounting stress in credit markets. Credit spreads for investment-grade and high-yield corporate bonds have widened at a pace exceeding that of the VIX, reflecting increasing concerns about default risk.

Amazon’s USD 15 billion bond issuance on Monday served as a litmus test for credit market health. Although reportedly well subscribed, final pricing spreads were wider than outstanding bonds, indicating investors demanded higher risk premiums. This reflects growing scrutiny of tech giants’ heavy borrowing to support AI infrastructure build-outs.

Osman Ali, Global Co-Head of Quantitative Investment Strategies at Goldman Sachs Asset Management, said: “There should be winners in AI, but it is clear some companies will be unable to compete in this new world.”

Credit concerns are spreading among AI-related firms. Credit default swap spreads for Oracle and cloud service provider CoreWeave continued widening.

CoreWeave’s spreads surged, while Oracle’s spread trajectory was viewed as an ominous sign by markets. Bitcoin forms a “death cross,” gold loses safe-haven appeal. Beyond traditional risk assets, supposed hedges also faltered.

Bitcoin fell sharply on Monday, dropping below USD 92,000 and erasing all gains for 2025. Its 50-day moving average crossed below the 200-day moving average, forming a “death cross” pattern. Notably, when Bitcoin triggered a death cross in April, it also set a new interim low.

Shares of Coinbase plunged 7.1%. Some market analysts suggested Bitcoin’s early decline on Monday may have acted as a leading indicator dragging the broader equity market lower.

Meanwhile, gold lost its safe-haven aura. According to The Wall Street Journal, some analysts believe gold’s recent trading resembles a speculative stock rather than a traditional safe asset. On Monday, spot gold fell toward USD 4,000. Silver also dropped sharply, breaking below the key USD 50 level.

Amid widespread declines across asset classes, the U.S. dollar index was one of the few winners, posting a strong rebound.

Prevailing pessimism is rooted in significant uncertainty around macroeconomics and monetary policy. The Federal Reserve’s policy path remains unclear. Traders have reduced bets on a December rate cut. Fed Vice Chair Philip Jefferson said Monday that policymakers need to “move slowly” on rate cuts, offering little clear guidance.

Investors also face mixed economic data. Commerce Department figures show nonresidential construction spending fell in August, with data center build-outs among the few bright spots. Other data indicate New York state manufacturing beat expectations, and overall construction spending unexpectedly rose, which in turn reduced expectations for Fed easing.

Concerns over the private credit market have surfaced. Asset manager Blue Owl saw its share price drop sharply after limiting investor redemptions at a non-traded fund.

Prominent investor Jeffrey Gundlach warned that the USD 1.7 trillion private credit market is creating “junk loans,” likening it to subprime mortgages ahead of the 2008 financial crisis, and said “the next major financial market crisis will come from private credit.” These factors have heightened investor caution as they await Nvidia’s earnings and key employment data.