Bitcoin's recent weakness coincided with renewed pressure on technology and software shares, where investors continued to grapple with the potential for AI-driven disruption. The Nasdaq-100 underperformed, slipping 0.3%, while the iShares Expanded Tech-Software Sector ETF dropped more than 2.7% in midday New York trading.
The software-focused fund has now declined in 11 of the past 15 sessions, pushing its year-to-date losses to nearly 25%. Broader equity indices remained largely flat, masking sharp divergences beneath the surface as financial stocks rebounded after weeks of weakness while consumer staples lagged.
Travel Sector Shows Surprising Strength
Travel-linked shares emerged as a notable pocket of strength amid the broader market uncertainty. Norwegian Cruise Line Holdings surged 11% after Elliott Investment Management disclosed a stake exceeding 10% and signaled plans to push for strategic changes following the cruise operator's prolonged underperformance.
The announcement triggered a sympathy rally across the sector, with Carnival Corp. rising approximately 4% and Royal Caribbean Group gaining 3%. In travel and leisure, Airbnb Inc. added 3.7%, extending momentum from last week's earnings report, while Southwest Airlines Co. jumped more than 6% following analyst upgrades from Susquehanna and UBS.
Bitcoin's Historical Cycles Under Scrutiny
The top cryptocurrency has fallen approximately 29% over the past month, igniting debate over whether the downturn is approaching a bottom or has further downside ahead. Trader Altcoin Sherpa highlighted past cycles for comparison, noting that both the 2017-2018 and 2021-2022 bear markets witnessed steep 75-85% drawdowns and required roughly a year from all-time high to final bottom.
Each historical cycle concluded with a sharp capitulation event, including the 2018 plunge from $6,000 to $3,000 and the 2022 crash linked to FTX, followed by several months of accumulation. However, Sherpa argues the current cycle may differ significantly from these precedents.
Structural Changes Could Alter Bitcoin's Trajectory
The 2024-2025 rally demonstrated notably different characteristics, proceeding slower with more consolidation phases compared to prior vertical surges. Several structural factors suggest this bear market could deviate from the traditional 365-day timeline, including the introduction of spot ETFs, reduced speculative excess, and stronger support established in the $50,000-$70,000 range.
Additionally, the altcoin market has already experienced significant froth reduction, potentially shortening the overall correction period. Sherpa believes that bitcoin has already capitulated with the dramatic move from $100,000 to $60,000, suggesting the market has now entered the accumulation phase of the cycle.
Looking Ahead: The accumulation phase could last anywhere from a few weeks to several months, representing a critical juncture for investors. If structural changes prove sufficient to alter historical patterns, bitcoin may avoid the full year-long decline typical of previous cycles, potentially offering earlier recovery opportunities for market participants.
