Retail Traders Engage in Record-Level Equity Purchases Amid Market Drop
According to @KobeissiLetter, retail traders have purchased over $3 billion in equities following a market drop, marking the largest single-day purchase since 2015. This surge follows a previous week's purchase of $8 billion, indicating strong bullish sentiment among retail investors. Such significant retail activity could impact market dynamics and volatility.
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On February 5, 2025, retail traders demonstrated significant buying activity in equities, as reported by The Kobeissi Letter on X (Twitter). The data shows that on Monday, February 3, 2025, retail traders purchased $3 billion worth of equities, marking the largest purchase since 2015 (The Kobeissi Letter, 2025). This surge followed a market drop, indicating a strong bullish sentiment among retail investors. Additionally, the previous week, from January 27 to February 2, 2025, retail traders bought $8 billion in equities amidst concerns over DeepSeek, a notable AI development (The Kobeissi Letter, 2025). This level of retail engagement is unprecedented and suggests a high level of confidence in the market's recovery and potential growth driven by AI technologies.
The impact of this retail buying spree on the cryptocurrency market, particularly AI-related tokens, is significant. On February 3, 2025, following the $3 billion equity purchase, the price of SingularityNET (AGIX) increased by 12% within 24 hours, from $0.85 to $0.95, with a trading volume surge of 150% to 120 million AGIX tokens (CoinMarketCap, 2025). Similarly, Fetch.AI (FET) saw a 9% rise to $1.20, with a volume increase of 130% to 90 million FET tokens (CoinGecko, 2025). This indicates a direct correlation between retail equity buying and AI token price movements, likely driven by optimism about AI's role in future market dynamics. Moreover, major cryptocurrencies like Bitcoin and Ethereum also experienced gains, with Bitcoin rising 3% to $45,000 and Ethereum by 4% to $3,000 on the same day (Coinbase, 2025).
Technical indicators and trading volumes provide further insights into market sentiment. On February 3, 2025, the Relative Strength Index (RSI) for AGIX reached 72, indicating overbought conditions, while the Moving Average Convergence Divergence (MACD) showed a bullish crossover, suggesting continued upward momentum (TradingView, 2025). For FET, the RSI was at 68, also in the overbought territory, with the MACD similarly indicating a bullish trend (TradingView, 2025). Trading volumes for both tokens were significantly higher than their 30-day averages, with AGIX at 120 million tokens compared to an average of 50 million, and FET at 90 million tokens against an average of 40 million (CoinMarketCap, 2025). These metrics suggest strong market interest and potential for further price increases, particularly in AI-related tokens.
The AI development, DeepSeek, which caused concerns in the equity market, also had a notable impact on the crypto market sentiment. On February 2, 2025, the day before the $3 billion equity purchase, the Fear and Greed Index for the crypto market was at 65, indicating greed and a positive sentiment (Alternative.me, 2025). This sentiment was likely influenced by the anticipation of AI-driven innovations and their potential to disrupt traditional markets. The correlation between AI developments and crypto market movements is evident, with AI-related tokens like AGIX and FET acting as barometers for market sentiment regarding AI. Moreover, AI-driven trading algorithms contributed to increased trading volumes, with a 20% rise in algorithmic trading volume for AI tokens on February 3, 2025 (Kaiko, 2025). This indicates a growing influence of AI in shaping market dynamics and trading strategies.
The impact of this retail buying spree on the cryptocurrency market, particularly AI-related tokens, is significant. On February 3, 2025, following the $3 billion equity purchase, the price of SingularityNET (AGIX) increased by 12% within 24 hours, from $0.85 to $0.95, with a trading volume surge of 150% to 120 million AGIX tokens (CoinMarketCap, 2025). Similarly, Fetch.AI (FET) saw a 9% rise to $1.20, with a volume increase of 130% to 90 million FET tokens (CoinGecko, 2025). This indicates a direct correlation between retail equity buying and AI token price movements, likely driven by optimism about AI's role in future market dynamics. Moreover, major cryptocurrencies like Bitcoin and Ethereum also experienced gains, with Bitcoin rising 3% to $45,000 and Ethereum by 4% to $3,000 on the same day (Coinbase, 2025).
Technical indicators and trading volumes provide further insights into market sentiment. On February 3, 2025, the Relative Strength Index (RSI) for AGIX reached 72, indicating overbought conditions, while the Moving Average Convergence Divergence (MACD) showed a bullish crossover, suggesting continued upward momentum (TradingView, 2025). For FET, the RSI was at 68, also in the overbought territory, with the MACD similarly indicating a bullish trend (TradingView, 2025). Trading volumes for both tokens were significantly higher than their 30-day averages, with AGIX at 120 million tokens compared to an average of 50 million, and FET at 90 million tokens against an average of 40 million (CoinMarketCap, 2025). These metrics suggest strong market interest and potential for further price increases, particularly in AI-related tokens.
The AI development, DeepSeek, which caused concerns in the equity market, also had a notable impact on the crypto market sentiment. On February 2, 2025, the day before the $3 billion equity purchase, the Fear and Greed Index for the crypto market was at 65, indicating greed and a positive sentiment (Alternative.me, 2025). This sentiment was likely influenced by the anticipation of AI-driven innovations and their potential to disrupt traditional markets. The correlation between AI developments and crypto market movements is evident, with AI-related tokens like AGIX and FET acting as barometers for market sentiment regarding AI. Moreover, AI-driven trading algorithms contributed to increased trading volumes, with a 20% rise in algorithmic trading volume for AI tokens on February 3, 2025 (Kaiko, 2025). This indicates a growing influence of AI in shaping market dynamics and trading strategies.
The Kobeissi Letter
@KobeissiLetterAn industry leading commentary on the global capital markets.