Macro Update – 07/08/2025 – Crypto

[00:00:57.03] - Speaker 1
Good morning, everyone. Welcome back to another session for this week. We are here again with the. Tim, nice to have you. Tim, welcome.

[00:01:06.11] - Speaker 2
Yes, good morning, ladies and gentlemen. Good morning for you.

[00:01:10.28] - Speaker 1
And so this week is focused on crypto. We recently launched our crypto intelligence product yesterday. We're gonna go over maybe a short demo as well during the session. But basically the goal of the session is to go over how we look at crypto from a macro standpoint. And Tim has prepared a few slides for us and so we're excited to look at the asset class from a macro perspective. I'll leave it on to you, Tim.

[00:01:39.26] - Speaker 2
Yes, thank you very much, Fabio. Yeah, guys, usually we met on Monday and talk a little about markets and all the other stuff that's in my mind and has to do with micro a little bit. Yeah. But today we are going over some crypto stuff I worked out for you. We will have a look at some different asset classes. You. Yeah. Make and trade also a little bit how to implement the new models that Entre is providing into your daily work schedule. Yeah. But first I have one or two slides. General markets, what's going on so that you are not missing out any stuff over there. And yeah, let's start with a brief overview from the short last week. Remember last Monday we pitched the IWM long trade on the macro. Monday in the morning, if you had hold this, this trade for the week which ended on Thursday, long weekend over there. So it's just a. We have a very small trade with a time frame of three days. IWM 3.5% nearly in this short week. Hilly benefits from the first day which saw higher NFP numbers and the market was considering this stuff is pretty good.

[00:03:06.28] - Speaker 2
Yeah, just a small reminder that sometimes stuff we are pushing, it's actually accessible for you guys too. The bigger chart here is the spx. As you can see, there's yeah, not much going on right there. Pretty range bounding mean reversion market right now with the first day, big, big gap up. I mentioned the NFP numbers which the market has seen as pretty decent. They were actually higher as the consensus. So recession feels canceled once again. He just are getting priced out. And yeah, this is the action you have seen on Thursday, Friday market was closed, then the weekend and yeah, we are already in the next week. What's going on in general? First of all, there's. Yeah, already or let's say again the fight between Trump and Powell. I think yesterday he called him a little baby that should resign. It's pretty, pretty obvious that those two persons have some deep going problems. Funny to watch sometimes but yeah overall it's a little bit chaotic out there but nevertheless stocks floating higher despite a very very weak market breath and yeah damped volatility already. It's a little bit of summer trading already right where people are just watching how the tariff tantrum stuff will play out.

[00:04:41.06] - Speaker 2
What will happens over the next deadlines that we have in tariffs. Also the impact on inflation from from the tariffs is now yeah seen a little bit weaker. It's a sentence I marked in yellow on the right hand side from Goldman Sachs this morning. They are running different models and for me it yeah looks kind of chaotic. No one really knows yeah how this stuff will play out in the end but the reading as of now is that this stuff is maybe not that inflationary as people have expected like one or two months ago. Right. The chart on the left hand side are some US sectors. You can clearly see the Lilic and the magenta one SPX QS yeah new all time highs as you have all seen last week with the RSP equal weighted SPX lagging a little bit behind alongside with small caps. That's a scenario where the equality tech stocks are outperforming. So speaking of Q. Q. Q. Right because they are yeah layered as kind of safe kinda the bet you can still ride in this market relatively unaffected from all the tariff stuff Other sectors are doing not that great but overall as you can maybe invention imagine some people are just yeah waiting how this stuff will plays out.

[00:06:14.14] - Speaker 2
Yesterday biggest spike in copper futures nearly 8,7% in a few minutes because of the new revealed 50 tariffs on copper from Donald Trump. The chart on the right hand side shows you the price gap between yeah London traded copper from the from the London Merchantile Exchange, the LME and the CME in Chicago. Big big spreads over there. That's not that really healthy when a big market like copper because copple is used in the entire world. Right. It's not a unimportant commodity and it's not really healthy for a market like this if shocks like this are are coming in. And yeah I looked into it yesterday for failing to trade in HG futures but in the end turns out yeah I was a little bit chicken over there. I mean you don't know what happens next over there but I'm still in the camp of yeah fading this stuff and I think that's my task for today. Looking a little bit into positioning in a couple of futures and yeah maybe set up a trade outright short not that small sized. Yeah, because of the news and headline risks that you always have. But I think it's a negotiation tactic from Donald Trump.

[00:07:43.04] - Speaker 2
50, 50% and this will maybe fade. All right, let's jump into the main topic for the day, crypto. We could maybe talk about the whole day, macro impacts and how is this related to crypto stuff. But I choose to, yeah, give you a little bit more of a basic overview right now because we usually try to keep this around 45 minutes, 1 hour, these small updates here. And yeah, the main focus today is a little bit of on the levels that Fabio and the team from Mentor Q has cooked up in the last months. What you're seeing here is the dashboard in general that is basically new since yesterday. And today, as mentioned, we will go over a few assets you maybe can trade or that are maybe not worth to trade. First of all, a little bit more of a basic information. This stuff here is maybe new to you. It depends how long you are at the market. If you are a little bit longer in the market, like six, seven years, you maybe remember the whole crypto stuff was quote, unquote, new to the market. Right. It was a market not dominated by institutional flows.

[00:09:16.12] - Speaker 2
So for institutional participation was kind of low and this market was way, way more volatile. Right. If you had some trouble in the market and risk assets in the ES or NQ futures have, yeah, sold off 3 or 4% in one session. The crypto boys usually, yeah, chuggled about it and said, wow. But that's basically a normal Monday in our world. But this has changed, right? Why is it like that? The right chart with the Ethereum DF inflows shows big, big numbers. Right. So crypto has already found its space after the years for the individual investor. And it's, yeah, not a niche product anymore. Right. Several ETFs are running in this space not just about crypto as yeah, quote unquote, the spot product that is monitoring Bitcoin or Ethereum prices. No. Later we will also have pitched some ETFs tracking several crypto companies and yeah, with the flow chart below, 64 billion. This is the weekly chart. Yeah, this is a weekly chart. That's. Yeah, that's big money. Right. And all this stuff leads to more appreciation not just from the individual investor, but also from the institutional investor. And this market is, yeah, getting more efficient a little bit.

[00:10:57.14] - Speaker 2
So very unlikely. You have days like six, five years ago. Yeah, we're Bitcoin future. Well, we, we didn't have Bitcoin futures back then. But bitcoin spot the exchanges were down like 12 or 15%. It's pretty unlikely. Nevertheless, it's still a risk asset. Right. The chart on the left side shows the QQQ below and the Bitcoin CME future btc. And you can spot roughly a little bit of this correlation. Right. The low over there that I marked with the white line was for the tariff announcements from Donald Trump. And as you can see, Bitcoin is tracking this stuff here roughly in the same way. Right. It's just a broader overview, but yeah, it's still, yeah, very high beta assets. But as mentioned, big money, more liquidity is damping volatility a little bit also over there. Well, what's also pretty interesting set are talking about coins as well in the crypto space. Even the US Bitcoin reserve was. Yeah. Mentioned I think in March this year already. And this shows you a little bit that not just only Wall street is looking into stuff, also administrations from other countries are looking into this market. This is kind of important because the more and more money flows into this market and circulates.

[00:12:42.09] - Speaker 2
Yeah, it can shape trends, but it can also, yeah, shape the idea behind all this stuff. If you guys remember all the memes that social media have created about coinbase in the U.S. army, I mean Coinbase is a sponsor of the U.S. army. Right. So this stuff is already, yeah, baked in big money and then politics stuff. Yeah. Nevertheless, tracking risky stocks with yeah, several crypto products can help you. Yeah. Define a little bit the broader trend and yeah, what's going on on big time frames. And because this market is so huge, it kind of creates also the own ecosystem. Right. You cannot just only trade the derivatives like futures options or you can also trade the physical stocks and of course also the options on the stocks over here. We have here some bigger companies that have to do with crypto stuff. And what's pretty interesting also the brokerage accounts that are running on. Yeah, let's say Robin Hood, I think that's a pretty, pretty popular brokerage firm into the US in the eu it's a little bit different. It's mostly finance, Coinbase, stuff like that. But Robinhood, yeah. Also favors from retail money that is flowing in, into this product because you have to pay commissions and other stuff.

[00:14:24.04] - Speaker 2
Right. The same goes for Coinbase, also a program which platform gives you access to several crypto products over there. And again I mentioned here, sponsor of the U.S. army. And this, this is not a joke. Right. These firms, they are pretty powerful. They are amongst the most important people in the US administration, if you have watched videos from dinners with Donald Trump or the inaugation process this year, the CEO of Coinbase has kind of same status like Mark Zuckerberg or Chef Beesus. Right. It's pretty interesting. Then there are the so called miners and also bitcoin holders with right platforms, Mar Holdings, Ticker, Mara and Riot. Those firms, they have pretty really decent amounts of bitcoins in their balance sheet. And of course if the price fluctuates from bitcoins also their balance sheets will inflate or deflate. Right. And then there are some, some niche firms like CleanSpark, they actually have a business model of sustainable energy for bitcoin mining. Right. Because you all know mining bitcoins has a huge, huge energy consumption. A lot of electricity goes for the cables if you are running a mining film. And and yeah those firms are specialized in delivering better solutions to deal with these energy products.

[00:16:07.12] - Speaker 2
And the cool thing is let's imagine bitcoin has big, big down over a week and there's a broader downtrend and what you always should do, maybe build a watch list with these tickers over here. I mean there are many more out there but you have also keep in consideration that also a lot of yeah companies over there so called shit cos. And if you stick to the big ones maybe for options play 50 bitcoin price or drags them down along there's usually yeah sometimes a pretty beautiful play where you can trade these stocks instead of yeah crypto directly. Right. I mean it's always depends on you. On the other side we have of course the ETFs also pretty interesting because they are spreading out their business models as well. Usually they are more cheaper in terms of investing and in terms of trading. I'm not that sure if we have US listeners today how accessible all of them are. Yesterday I looked in my broker rich account but I'm EU based right. And I didn't. Yeah can access all of them. So I just came up with these four numbers here. Ibit is pretty basically well known into the space largest holder just the bitcoins holding.

[00:17:44.05] - Speaker 2
So there's always the correlation bitcoin price, Iet price. Right. But other stuff as block and stce they are investing in blockchain companies. For block it's over 50 and for STC it's over 40 crypto related companies. And of course this is always tied to the bitcoin price itself. But you have always outliners if a company or two companies into the stock basket from the block Block ETF maybe have a new invention or you have dropping a new business model or something like that. There could be outperformance over there. Right. So here you have the advantage not monitoring all the firms that are in this crypto space involved. The ETF does it for you like every ETF does it. Q. Q. Q. Right. Don't have to mention it's way more easy than stock picking because for stock picking you always have to do a little bit extra work and extra research. And yeah, the second order crypto coins like Ethereum label here with the Etha a little bit worse performance this year. I don't know why. But yeah, basically there is a ETF out there for not just Bitcoin, also Solana, Ethereum and all this stuff. They basically hold these coins directly and this is much more tied to the price of the underlying if you want to trade this stuff.

[00:19:24.17] - Speaker 2
Also the stocks from before, we usually have all the data from this ETFs or stocks. And when it comes to options trading, don't forget to always. Yeah do your process over there. Implied volatilities, positionings. Is my trade expensive or is my trade cheap? Right. This stuff also applies even if we are moving into crypto space over here. That's basically part of the new dashboard that Mentor Q has dropped yesterday. There's a video out there where Fabio tells you everything in detail about this stuff here. That's the way I just decided to keep it kind of briefly with this. That's basically my approach. Right. Just telling you how I view this stuff. Usually big picture, then drill down daily time frames and then the time frame you want to trade. But this is pretty technical from the first view. But if you have an overview over the big picture you always know. Yeah. What is kind of going on into the anti crypto space we had several times the last months and I already mentioned the so called crypto reserve from the US administration where those news were floating around a little bit. Right. Then they got announced.

[00:21:07.24] - Speaker 2
But Bitcoin and other crypto assets have been sold. Right. With the announcement from this news and then people are always surprised, wow, why can't this happen? What's yeah, what's the story behind? I mean the news itself is bullish but the assets get sold. What I mean with that, if you monitoring the big picture, what is the market already awaiting? What has the market maybe already priced in? Right. You always have a little bit of a broad overview by this asset is currently trending down or up or why this asset is currently. Yeah doing a Mean reversion market into daily time frames. Well again that's pretty technical. I just watch stuff over there, how big the ranges are. Right. Later we will look at the MBT future for the CME and it's pretty straightforward with the MQ model because it shows you one day max, one day min range. And from my side just look how those ranges are expanding or contracting. And for the trading time frames this is then based on demand Q levels that we have out of the options chains. And if this is kind of. Yeah, done. The so called market summary.

[00:22:40.08] - Speaker 2
What's trending, what's not trending? You can go a little bit more into the weeds and look for the specific asset I have choose Bitcoin over here because I think it's the. Yeah, mostly used underlying also for the sophisticated day trader. And yeah, risk on risk of sentiment indicators. There is a crypto direction indicator and I don't know Fabio, if you have like two or three minutes for those two slides to explain them a little bit because obviously it's prosperity data. Right. And I don't know all the aspects like you may know.

[00:23:20.24] - Speaker 1
Yeah, absolutely. So maybe I can share my screen one second. Yes. So basically yesterday we released our crypto intelligence. And the crypto intelligence is based on mostly two factors. We built our option models which are very similar to the ones that you see for stocks, ETFs and indices. So we have our net gamma exposure chart, we have a swing model, we have our Q score, sku. All of these are available on major cryptos. We cover also multiple exchange. So we cover Deribit, Binance, okx. When we look at derivatives, Deribit is still probably the most important exchange for spot crypto derivatives. But also binance is becoming also relevant. So you guys can access the different coins looking at the different exchanges. On top of that we built our quant models because of course crypto is also very highly correlated with the rest of the market. Just looking at option is important. But we also went a step further. We wanted to also look at other data sets and other ways of looking at the market. So we have here our three models and the first model is kind of like a regime model. So we are looking at traditional market data that can be correlated with the crypto market to understand if we are in a risk on or risk off scenario.

[00:25:01.20] - Speaker 1
So in this case what we see is that zero is the threshold. If we go below zero we are in a risk off scenario. So yesterday we went, we're kind of like in a risk off. Now we are Back kind of like in a risk on scenario. So that can help you understand at the macro level how are we in terms of regime on the crypto side and is the market bullish or bearish on crypto? So this can give you an idea. So if you are thinking about entering the crypto market is a good way to understand if the market can be in a positive or negative regime. The second one is our directional indicator. So this is a directional bias indicator that we are building on different crypto assets with the goal of understanding if we are in an uptrend or a downtrend. So as you can see here, and the indicator goes from minus one, which is very bearish, zero which is neutral, which is what we see now. And then we have 1, 1 and 2, which is bullish.

[00:26:04.28] - Speaker 2
Right.

[00:26:07.12] - Speaker 1
And, and the third one is we call it QRSI because is like, like we, we take a similar approach to the traditional RSI but we modify that and we create a similar, similar indicator where you have an overbought and oversold condition. And then here you get, you get the data and then once you, you get that, you can also go into our market summary dashboard where you can see everything in one place. For example, if we go back to yesterday, we were in a risk of scenarios. So the sentiment was kind of bearish around the crypto space. We had some neutral directional and then we have the RSI here and then we can go to today and now we can see that for example we are in a risk on scenario. And here, yeah, we're still quite neutral on in terms of direction, but we do have a bullish direction for example for trx and then you can click on it and then you can kind of go and over the different indicators.

[00:27:20.08] - Speaker 2
Right here I was playing around today a little bit with it. I basically used the risk on risk off sheet and the market summary. And the cool thing is in the market summary, I mean it shows you one day, five day, 30 and 90, right? If I remember correct, one day, one month, three months, one year. And what you guys can do then over there with the risk on risk off chart and the market summary, you can tweak the data at the date right on top of it. And then you can always compare like what has performant when the Q crypto risk on risk off chart was on the lows right in April, what has performed over there and what is performing right now. It's kind of like in currency trading where you are mapping out strong versus weak currencies. You can basically do the Same over here. Yeah, I mean it doesn't pull out a trade on the first glance. Right. But it's maybe a little bit of a help where you can start looking in this data because it can be really, really confusing just looking at a chart where you just have yeah price action and do your technical analysis because those screeners are mapping those strange trends against weak trends and that's a little bit more granular from my side.

[00:28:55.02] - Speaker 1
Yeah. And also Tim, we can share. Let me put this up here. This is part of our documentation we have. If you go under our guides which are available for everyone just go under quant strategies, crypto strategies and then here you have the back test that we showed yesterday. So for example if we look at just the risk on risk off indicator we did an interesting back testing results on Ethereum. So buy and hold strategy on Ethereum would have like lost about 50% in the last six, seven months using risk on risk off scenario. So the assumption is that you go long when the risk con is greater than zero and you go short when the risk off is lower than zero and then simply you're always in a trade so you just basically switching when the indicator crosses and basically that's kind of like the return of the strategy in green versus the return of simply buy and hold the coin.

[00:30:00.18] - Speaker 2
In this case Ethereum get a straightforward. The prompts are not too complicated. That's good.

[00:30:07.25] - Speaker 1
Yeah. I mean obviously this is very very easy but like the indicator can be very good to understand if we are you know even like a position sizing. So if you are thinking on getting into the the crypto space is it a good time or not and how can I manage my risk now?

[00:30:30.20] - Speaker 2
So I just have one last slide. Right but you presenting right now. All right so and for yeah 40 day trader that maybe tries to find his luck in trading bitcoin futures with all the stuff here you can basically build your yeah daily trend idea what will happens and the next one from my side would be always looking into positioning. That's the reason why the right lower chart shows the Netgex or expirations for NBT futures. So the options for the micro MBT and what's not have to miss in the charts out yet the level from ENTORQ and as you can see we are not that really trending. I mentioned it before two time frame market. Yeah means yeah highs are getting sold, lows are getting bought and you have those ranges yeah that are kind of, kind of building up and as you can see here the put support HVL0DTE and the put support 0DTE at 107500 and call resistance and and yeah Gamma War has 110 for MBT. The July 2025 contract, this stuff. Yeah is in place like from beginning of July already. Right. We had a little bit of buying in the beginning of July.

[00:32:07.04] - Speaker 2
Trend got faded. I know it's a four hour chart but as you can see at the candles are from those major levels. They are getting respected from the down or from the upside. And yeah basically your job is in this scenario now mapping out what's the daily range of my asset that I want to trade. Right. Because if your idea is to yeah buy here below 107500 you maybe have to wait three or four days. Right. Again that's a four hour chart and selling off like $2,000 out of the blue and just four hours or one session is pretty, pretty unlikely. So we have to wait a little bit more. On the other hand, is it possible that we are trading above 110 in the next few hours? So from my side those levels are always giving you a little bit more patience into the market. Right. You don't have to fumble in the middle and buy at some real areas where you get wicked out. So yeah, that would be basically my approach. That's the reason why I marked those two areas over here. I don't wanna yeah do something in the middle but to be Honest Next Level 110850 also looks appealing to me.

[00:33:34.12] - Speaker 2
But to be honest the breakout we were above 110 unlikely this week. But yeah, let's see. Yeah and in the end that's basically yeah my short term approach to yeah deal with at least the micro bitcoin future. If you guys wanna look more into the companies or the EDF's that we mentioned a little bit earlier. Of course you can use the data from Mental Q to just have a data driven approach that's also good. But from my experience it's also a little bit important as well to watch the whole crypto space. What stories is going on over there. And yeah general if the stock market appreciates pretty pretty risk on moves the crypto yeah. Space will probably do the same. That's kind of safe to say. Right. And yeah, I think we are done. It's the last slide.

[00:34:43.08] - Speaker 1
Yeah, yeah. And I think I wanted to share also the schedule for this week guys because because of the launch we're gonna have a lot of different sessions for you. So we are live another two times today. We are going to be live in like an hour with Anne Marie from Topstep X. We're going to be live with Patrick later to talk about blind spots. And then tomorrow we're gonna have a couple of sessions on crypto and forex, so don't miss those because very, very great speakers. We have Kieran and Jay coming back and then on Friday we're gonna have some sessions on options and live trading commentary with Patrick again. So very, very exciting. Also, if you guys are interested, we're running our promotion this week. So if you guys want to look at the crypto stuff and try it out, just check out our website, mentor Q.com and then if you have any questions, please send us an email and we can answer any questions you might have. But thank you so much, Tim, for the time and this was awesome.

[00:35:58.17] - Speaker 2
Yeah, thank you for listening and thanks for your time too, Fabio. Bye.

[00:36:03.01] - Speaker 1
Bye.

[00:36:03.23] - Speaker 2
Bye. Have a nice week.