Weekly Market Positioning
+

New facelift to my weekly email - what do you think?

What happened this week?

Last week delivered high drama in the crypto markets, centered around two major narratives: Powell's FOMC press conference and an epic battle between whales and a massive short position.

The week began with markets on edge as a huge BTC short position grew from $460M to $520M, with the anonymous trader maintaining their stance despite multiple attempts by whales to force liquidation. This high-stakes game of chicken saw Bitcoin briefly surge to $85.1K in just nine minutes as whales attempted to trigger the short's liquidation level at $85.3K.

The real fireworks came with Powell's press conference. Despite no change in rates (as expected), Powell's surprisingly dovish tone shifted market sentiment. His use of the term "transitory" to describe inflation and suggestion that Trump's tariffs wouldn't have long-term impact triggered a significant rally, pushing Bitcoin above $87K and out of its week-long consolidation range.

Most telling was Powell's signal that the Fed will remain patient, avoiding any rush to make rate decisions due to ongoing uncertainty. The market has priced in two rate cuts by year-end, even though the Fed's dot plot suggests only one. This divergence between market expectations and Fed projections will likely drive volatility in the coming months.

The week concluded with a new dynamic in play - the SEC's crypto task force held its first-ever roundtable with industry leaders, marking a significant shift from previous adversarial relationships. This constructive dialogue, combined with Powell's dovish stance, suggests a potentially more favorable regulatory environment ahead.

How am I positioning?

I'm hunting for long entries with a mid time horizon, but remaining patient and buying on dips vs strength. We likely have about 2 weeks to find good entry points on dips.

The current BTC $85K range could trend upward if held definitively, especially if we get confluence of equities coming back. However, losing the $82K level could trigger additional selling pressure IMO.

Several short-term factors are worth considering:

Tax selling pressure is finished April 15th
Markets have shifted to defensive positioning. The longer we consolidate at these levels, the more bullish I become as we exhaust potential sellers in a local bottom scenario
Tariff situations likely see resolution around April 2nd. Given the reciprocal nature of US tariffs, game theory suggests de-escalation is more probable than escalation
If tariffs don't resolve, April's CPI numbers look promising. Truflation data, which typically leads official inflation data by 60 days, shows rapidly declining numbers. IMO we see a cool print.

However, two major macro overhangs need monitoring for wider time frame:

Widespread weak consumer spending signals, evidenced by guidance from Delta, Nike, and others
Surge in law school and business school applications, indicating a challenging white-collar job market

The key question is whether these signals reflect productivity gains or indicate structural weakness and deteriorating earnings quality.

For asset selection, I prefer Robinhood ($HOOD) as my crypto exposure. It's misunderstood by traditional investors and flying under crypto natives' radar. Their business model wins in both directions - capturing fees in crypto bull markets while retaining users who trade equities in bear markets. They're following the Zuckerberg playbook: own the user, copy/buy products, leverage distribution to captive audience.

Check out my writeup on $HOOD below:

Dave | Emerging Markets

@DaveWangMIA

1:45 PM • Mar 17, 2025

Retweets

Likes

If you want to hedge out crypto momentum, consider pairing long $HOOD with short $BTC. HOOD in my opinion could outperform BTC in bull markets while maintaining similar downside profile if we trend down.

Here's a 2 step prompt I used last week to get guidance ahead of FOMC last week - steal my prompt from my full X post below:

Dave | Emerging Markets

@DaveWangMIA

12:21 PM • Mar 19, 2025

Retweets

Likes

Grok has real time data and sentiment analysis. And correctly predicted ahead of the meeting an outsized probability of a dovish hold.

Get one high impact AI prompt every week