- Goldman Sachs has cautioned investors that there will be more stock selling pressure this week.
- The bank expects Commodity Trading Advisers to sell over $33 billion this week if the S&P 500 keeps falling.
- Bitcoin led a broad crypto selloff as extreme fear grips markets, signaling volatile trading ahead.
Goldman Sachs Group Inc. (NYSE: GS) has warned of more stock and crypto selloff this week. The bank cautioned investors to approach the stock market and the crypto industry with care this week, especially if the S&P 500 index continues its bearish performance.
Goldman Sachs Warns of More Stock Selloff This Week
Last week, the S&P 500, the Dow Jones Industrial Average, and the NASDAQ Composite lost 0.1%, 2.5%, and 1.8%, respectively. As such, Goldman Sachs stated that the S&P 500 has already breached its short-term trigger that prompted the Commodity Trading Advisors (CTA) to sell stocks last week.
If the S&P 500 keeps its midterm bearish sentiment this week, Goldman Sachs estimates the CTAs to sell stocks valued at about $33 billion before the end of this week. Further, the bank believes that the CTAs have more than $80 billion to offload in the next month if the S&P 500 keeps falling in the coming weeks.
The bank highlighted that stock selling pressure will be exacerbated this week by heightened retail capitulation. Furthermore, the stock market’s fear and greed index remains in fear after major tech companies reacted negatively to the launch of a new automation tool from Anthropic PBC.
On Monday, February, CNN’s Fear & Greed Index was hovering at 45/100, on the border between Fear and Neutral. Similarly, Bloomberg’s Panic Index hovered around 9.22 at press time, indicating traders are in fear and are approaching the extreme fear level.
With the thin liquidity, Goldman Sachs expects the stock market to continue with its recent choppy trading. Nonetheless, President Donald Trump has championed a stock market rally by the end of this year.
Will the Crypto Market Get Spared?
With the crypto industry having shown a high correlation with the stock market in the recent past, the former is likely to continue with further capitulation. Last week, Bitcoin (BTC) led the wider altcoin market in a heavy selloff. The total crypto market was hovering around $2.4 trillion at press time.
Notably, CoinMarketCap’s Fear & Greed index hovered around 9/100, which is extreme fear. With the general crypto market trending downwards, choppy volatility is expected to rock the crypto industry this week.
Nonetheless, on-chain data from CryptoQuant shows whale investors have been aggressively accumulating Bitcoin in the past few days. Furthermore, the anticipated capital rotation from the precious metals to crypto will catalyze a fresh crypto bull market before the end of 2026.
Related: Arthur Hayes Says Bitcoin Drop May Be Caused By Institutional Hedge
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