These were the comments on my last video, the one titled “I Just Sold Everything.” I don’t want to spend too much time dunking on people. But I hope those two are watching this week because the S&P is down nearly another percent today, gold gave back its gains, Bitcoin rejected off $76K and dumped back to the high $60s, and I’m sitting in 100% cash having avoided all of it.
The system spoke. I listened. The market did the rest.
The stress dashboard confirms it. VIX hit new highs today. The MOVE Index continues to rip higher.. bond volatility is elevated and trending in the wrong direction. The Dollar has broken out bullish and continues to strengthen. None of this is supportive for risk assets.
Rate hike odds continue to creep higher. April: 2% chance of a hike. June: ~7% with a 0.1% shot of a 50bp hike. July: numbers keep shifting higher. And by September, there’s a 25% chance of a rate hike. Not a cut. A hike.
The macro regime engine flagged all of this weeks before FOMC. The system continues to do its job.
The bigger theme: All models break.
APSK32 posted his Bitcoin cycle comparison chart.. the one that had everyone convinced of $200K last July. This cycle has clearly broken the model. And that’s the point I keep making: Bitcoin has price action going back to 2009, but you can really only count two mature cycles. That’s an n of 2 in terms of sample size. That’s not statistically powerful enough to build a prediction framework on.
Global M2 was the hot narrative until it broke. BTC/Gold was the hot narrative until it broke. Cycle seasonality models.. broken. The theme is clear: all models break eventually, especially for an asset class with this little history.
That’s why I follow systems that react to what’s in front of them rather than models that predict.
Final Thoughts
Two weeks of risk off. The slide continues. The doubters are quiet.
I’m prepared to sit in cash for five, six, seven months if that’s what the systems demand. The main weapon I’m sharpening right now isn’t about getting out.. that’s done. It’s about getting back in as fast as possible when things start turning positive. That’s where the real edge compounds.
We stay in cash. We stay disciplined. And when the signal flips, you’ll hear it from me first.
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💥 Stay sovereign. Don’t be exit liquidity.
— Durden out.
✊🧼
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