Asian equity markets traded in a narrow range on Monday with activity constrained by public holidays in China, South Korea, and Taiwan. Japanese shares showed modest divergence after the release of fourth-quarter 2025 GDP data that fell short of forecasts. The Nikkei 225 advanced 0.14 percent to around 56,900, while the TOPIX declined 0.2 percent to 3,810. Japan’s economy expanded by only 0.1 percent quarter-on-quarter in the final three months of 2025, recovering from a 0.7 percent contraction in the prior quarter but missing the expected 0.4 percent gain. Industrial production also slipped 0.1 percent month-on-month in December, marking the second consecutive decline. The yen weakened to approximately 153 per dollar, giving back some of the previous week’s gains.
Asian Markets and Currency Moves
These developments contributed to a subdued risk tone across the region. With mainland China closed for the Lunar New Year holiday, the offshore yuan strengthened to a thirty-four-month high near 6.89 per dollar. Hong Kong’s Hang Seng Index rose 0.52 percent to 26,723, snapping a two-day losing streak, while India’s Sensex gained 0.22 percent to 82,680 and Australia’s ASX 200 added 0.22 percent to 8,943. Overall volumes remained light, reflecting the holiday calendar and limited fresh catalysts.
Precious Metals Performance
Precious metals went through a phase of profit booking from the market participants after recent strength. Gold declined more than 1 percent to trade near $5,000 per ounce, pulling back from levels above $5,600 reached in late January. Silver dropped more than 1 percent toward $76 per ounce. In the time period of recent weeks under consideration, the move in gold, while lower on the day, still illustrates its greater performance relative to the crypto market.
U.S. Futures and Policy Expectations
U.S. equity futures traded with minimal change amid the Presidents’ Day holiday closure. The Dow Jones Industrial Average future rose 0.14 percent, the S&P 500 future 0.13 percent, and the Nasdaq 100 future 0.06 percent. Investors continued to digest Friday’s softer-than-expected January inflation report, which did not materially alter expectations for the Federal Reserve’s policy path. Attention now shifts to the upcoming FOMC meeting minutes, the advance estimate of fourth-quarter U.S. GDP, and the January PCE inflation reading.
The Impact On Crypto
The mix of thin liquidity in Asia, modest Japanese growth figures, and persistent uncertainty surrounding U.S. interest rates has provided a cautious backdrop for the high-risk assets. Cryptocurrencies continue to feel pressure despite the modest firmness in U.S. equity futures. Bitcoin was changing hands at $68,710, down 0.1 percent on the day. Most alternative tokens posted larger declines, with DOGE falling more than 10 percent in the past 24 hours and several others, including HYPE, ZEC, and XMR, dropping over 3 percent.
Ether Price Movement and On-Chain Trigger
Ether proved an exception, advancing 0.43 percent to near $1,988 and recovering toward the $2,000 level. The move followed a significant weekend sell-off triggered by a single large transfer. The on-chain records show that Garrett Jin’s linked wallet made a deposit of over $540 million worth of ether to the largest centralized crypto exchange, Binance, which triggered extra selling activity on the platform and pushed the token into an oversold condition. The rebound that followed came from short-term selling pressure, which resulted in exhaustion instead of any actual fundamental market transformation.
Derivatives Positioning and Volatility
Broader derivatives data illustrate the prevailing de-risking across the crypto market. Total notional open interest in futures contracts fell to $98 billion, with declines registered in bitcoin and ether contracts as well as in several altcoin pairs. Open interest in bitcoin futures dropped 1 percent and in ether futures 2.7 percent over the past 24 hours, while several altcoin contracts saw reductions of 6 percent or more. Funding rates for tokens such as XRP, TRX, DOGE, and SOL stayed in negative territory, signaling that short positions continued to dominate.
Capital Rotation Toward Gold
The current market trend highlights that the market participants are now leaning towards safe haven assets like gold in comparison to the risky assets like cryptocurrencies. Gold has experienced only a small decline since its peak compared to the crypto markets that have gone through a 21 percent correction since their late-January highs. The relative trend shows that investors still choose to invest in gold. The market behavior shows that investors have shifted their funds from high-risk digital currencies to safer investment options, which become more attractive during times of market stress and low growth predictions.
Liquidity Conditions
Market conditions at present show how liquidity requirements affect market operations. Major Asian financial centers are closed for holidays, which has decreased trading activity and this situation causes large trades like the recent $540 million ether deposit to create excessive market effects. The market experiences extreme price movements during periods of low trading activity because actual market conditions do not change. The U.S. futures market showed limited activity during the same session, which revealed how low market participation restricted the formation of distinct market trends.
Upcoming Macro Catalysts
The near-term sentiment for the financial market will be influenced by several macro factors. The Reserve Bank of Australia policy meeting minutes are scheduled for Tuesday, and a series of corporate earnings from major miners and industrial names are expected to provide insight into commodity demand and regional growth.
Investors are watching the FOMC minutes, GDP, PPI, and PCE data for clues on U.S. rate policy. The uncertainty around rates is most likely to hinder risk-taking, which makes assets like cryptocurrencies more sensitive, often capping short-term gains.
Positioning Signals
On the favorable side, negative funding rates among multiple altcoins strengthen the chances of a short squeeze that could flush out the late shorters and help the market stabilize or show resilience. A single large bullish option flow on Deribit, with $3 million in premium paid for a $75,000 bitcoin call, demonstrates that some participants continue to position for upside. However, the overall derivatives positioning remains defensive.
Market Structure and Near-Term Outlook
The current environment reflects a market in consolidation mode. Weak growth data from Japan, holiday-induced thin liquidity, and unresolved questions about the trajectory of U.S. monetary policy have combined to suppress enthusiasm for riskier assets. Cryptocurrencies have underperformed gold and shown limited follow-through on any positive equity cues. Ether’s isolated recovery after the weekend sell wave highlights how specific on-chain events can temporarily decouple individual tokens from the broader trend, yet the dominant picture remains one of caution.
