Top Wall Street CEOs, including David Solomon of Goldman Sachs and Ted Pick of Morgan Stanley, have issued a warning. They foresee a 10% to 15% equity correction in the next 12 to 24 months. This macroeconomic caution coincides with a time when Bitcoin shows weakness against the S&P 500, losing key technical levels.
The main concern is “excessive” valuations. Mike Gitlin, CEO of Capital Group, noted at a financial summit in Hong Kong that the S&P 500 is trading at 23 times forward earnings. This figure is well above the five-year average of 20x. Gitlin described the market as “between fair and full,” but far from “between cheap and fair.” Credit spreads are showing similar patterns, offering little cushion against potential shocks.
Is the Crypto Market Already Absorbing the Hit Wall Street Is Just Anticipating?
The warning from these financial titans is significant. It suggests that risk premiums have compressed dangerously. Although corporate earnings remain strong, the high price of stocks leaves little room to absorb negative shocks. Political uncertainty also persists. This cautious consensus from major investment firms indicates a shift in sentiment, moving from euphoria to risk management.
This macro nervousness is reflected in the cryptocurrencies market. Analyst Brett highlighted a worrying technical signal. Bitcoin shows weakness against the S&P 500 (the BTC/SPX ratio) and is printing its third consecutive weekly candle below the 50-week simple moving average. Historically, this level has acted as crucial support during bull markets. Losing it could foreshadow a broader rotation out of risk assets.
However, not all is pessimism. Hunter Horsley, CEO of Bitwise, offered an alternative perspective. He suggested that fears of a 2026 bear market may have pulled the downside risk forward. Horsley posed that the market might have already been absorbing this correction during 2025. Therefore, markets appear to be approaching a normalization phase of prices rather than a total collapse. Investors may soon begin to favor fundamentals over excessive optimism.
