NVIDIA's earnings report is a shock! $57 billion exceeds expectations, full analysis of Bitcoin correlation risks.

NVIDIA released its third-quarter earnings report after the US stock market closed. The report showed that the profit for the third quarter was $57 billion, exceeding Wall Street's expectations of $54.92 billion; earnings per share were $1.30, also above the expected $1.25. The spot order book depth for BTC and ETH lags behind the overall pace of price fluctuations this month, and the reaction of tech stocks following the NVIDIA earnings report may trigger a chain reaction.

NVIDIA's earnings report exceeded expectations, but market reaction is key

(Source: NVIDIA)

NVIDIA's financial report for the third fiscal quarter shows a profit of $57 billion, exceeding Wall Street's expectations of $54.92 billion, which is an impressive figure in itself. Earnings per share were $1.30, also surpassing the market consensus expectation of $1.25. From the numbers, NVIDIA has once again delivered an outstanding performance, continuing its strong growth momentum as a leader in AI hardware.

However, in the current market environment, unexpectedly high figures do not guarantee a rise in stock prices. The release of this financial report coincides with a period when stock indices are particularly sensitive to trends in artificial intelligence hardware demand, export restrictions, and supply timelines. This means that any performance that falls short of expectations or weak guidance could widen the decline in the technology sector and exacerbate cross-asset correlation as post-market liquidity becomes thinner.

The market's interpretation of NVIDIA's financial report has gone beyond simple revenue and profit figures; investors are more focused on future outlook, order visibility, and supply chain conditions. Changes in the revenue structure, if they indicate a decrease in data center orders or extended delivery cycles, typically raise the beta coefficient of the semiconductor industry, and these changes often trigger a de-risking process, which can affect cryptocurrencies during the evening trading sessions in the US and the opening period in Asia.

If the announced results are clearer and the comments on supply, delivery, and capital expenditures are more stable, it is more likely to stabilize stock index futures and alleviate the defensive rotation that has occurred this month alongside the weakening of digital asset closings, as index fluctuations typically reset the short-term relationship between technology stocks and cryptocurrencies during event windows. NVIDIA's on-demand color, supply chain, and customer spending plans have driven this policy growth portfolio, as the artificial intelligence hardware cycle has become a shorthand indicator of large tech companies' willingness to invest and the breadth of profits supporting stock sentiment.

Analysis of the Correlation Mechanism between Technology Stocks and Cryptocurrencies

The impact of NVIDIA's financial report on the cryptocurrency market is not direct, but rather acts indirectly through risk appetite and liquidity transmission mechanisms. When a tech giant like NVIDIA releases its financial report, if the stock price fluctuates significantly, it often triggers a ripple effect across the entire tech sector, thereby affecting investors' overall allocation strategies towards risk assets.

Cryptocurrencies, as typical representatives of high-risk assets, have seen a significant increase in correlation with technology stocks, especially those related to AI, in recent years. This correlation arises from several factors: First, there is a high overlap between the investor groups of technology stocks and cryptocurrencies, with many hedge funds and retail investors holding both types of assets simultaneously. Second, the impact of the macro liquidity environment on both is consistent; when market risk appetite rises, funds flow into both technology stocks and cryptocurrencies at the same time; when risk appetite declines, both face selling pressure.

During the specific time window of NVIDIA's earnings report release, this linkage mechanism became more apparent. Liquidity is thin during after-hours trading, making it easier for large orders to cause sharp price fluctuations. If NVIDIA's earnings report leads to a significant drop in technology stock futures after hours, this sentiment will quickly spread to the 24-hour trading cryptocurrency market, triggering early hedging operations.

The Transmission Path of Technology Stocks and Cryptocurrency Correlation

Emotional Transmission: NVIDIA's poor earnings report → Tech stock sell-off → Decreased risk appetite → Cryptocurrency sell-off in sync

Liquidity Transmission: Tech stocks decline → Hedge funds face margin calls → Forced to sell more liquid crypto assets

Futures Market Transmission: Stock index futures decline → CME Bitcoin futures follow → Spot market arbitrage pressure increases

Against this backdrop, the recent trends in cryptocurrency are less about being dictated by a single news headline and more about whether liquidity will be rebuilt as the market base tends toward stability. If these factors turn positive after the data is released, risks often stabilize across both screens; however, if divergences appear within a few hours after the call, volatility typically persists until the next trading day.

ETF Fund Flow and Liquidity Exhaustion Risk

(Source: CoinMarketCap)

The spot order book depth for BTC and ETH lags behind the overall pace of price fluctuations this month, and the spread widens near key time points in the U.S. Therefore, shocks that occur when the order book is thin may cause greater cryptocurrency price fluctuations relative to the underlying news. This fragility in the liquidity structure makes significant events like NVIDIA's earnings report more likely to trigger excessive volatility.

When this pattern appears, the futures capital and basis usually readjust first, and the stability of the spot market only occurs after market makers rebuild their inventories and tighten quotes. This makes it easy for intraday rebounds to be affected if stock futures weaken at the close. The fund flows of Bitcoin ETFs have become a key indicator for assessing market confidence. On hedging days, the net outflow of Bitcoin instruments aligns with greater pressure at the close.

The trends in ETF activities and stablecoin supply provide a second layer of factors affecting their durability. The continuous rise in stablecoin circulation aligns with a more solid spot settlement and a reduced reliance on leverage, thereby supporting the rebound. If the reaction of tech stocks tonight indicates a tightening of financial conditions, these channels often determine whether buying pressure will quickly rebound or if the market will rely on short covering, which will soon be exhausted.

According to CoinMarketCap's Cryptocurrency Fear and Greed Index, the current market sentiment is in a relatively cautious range. In this emotional context, any negative surprises from NVIDIA's earnings report could quickly push the index into the panic zone, triggering a larger-scale sell-off. Conversely, if the earnings report and outlook exceed the market's most optimistic expectations, it could rapidly reverse sentiment and drive the index into the greed zone.

The Combined Effect of USD Trends and Macroeconomic Risks

The macro environment remains crucial, as concerns about economic growth or tightening conditions can lead to a stronger dollar, which often puts pressure on global risk; conversely, a relief in economic conditions that causes the dollar to weaken can support the stock market, thereby supporting cryptocurrency pairs that trade in sync with stock index futures during event-driven trading periods. The movements of the dollar index often react hours or even days ahead of risk assets.

NVIDIA's earnings report coincides with a delicate moment in expectations surrounding Federal Reserve policy. If NVIDIA's performance and outlook indicate that the AI investment boom remains strong, it could reinforce expectations of economic resilience, pushing up the dollar and suppressing risk assets. Conversely, if the earnings report shows weak demand or inventory buildup, it may exacerbate concerns about economic slowdown, which, while potentially boosting dollar demand for safe-haven assets in the short term, could undermine the credibility of the Federal Reserve's hawkish stance in the medium term, ultimately benefiting risk assets.

This complex transmission mechanism means that NVIDIA's financial report has multiple pathways and lag characteristics in its impact on cryptocurrencies. Investors need to closely monitor the immediate reactions of the US dollar index, US Treasury yields, and stock index futures after the financial report is released, as the combination changes of these indicators will determine the trend of the cryptocurrency market in the next 24 to 48 hours.