Bitcoin: neutral. 8th Rule sitting at a 25% probe. Month three of the chop.
Ethereum: gone. Signal flipped bearish, position closed in full.
Gold: full allocation. Two gap-ups this month and it hasn’t looked back.
Equities: untouched. Fully long, no changes.
Macro Regime Engine: Goldilocks, 13 votes. Risk on.
The near-miss: around August 4–5 the production engine was 2–3 days from flipping risk off. It didn’t. That non-event is the story of the month so far.
The uncomfortable read: the system is fully invested and printing.. just not in crypto.
Two versions worth comparing here.
The original MRE sold the bottom and bought back near the top. I’m showing it because I’d rather you see the failure mode than pretend it doesn’t exist. I wrote a whole post about this a few weeks back.
The production engine, the one actually running the book and the one subscribers get, did not flip. We got close. Early August it was hanging by a thread. Then breadth rebounded and we’re back to a clean Goldilocks read at 13 votes.
Last risk-off print was around April 2025, the tariff shock. That’s it. That’s the whole list. Everything since has been held.
Current allocation:
Equity sleeve fully allocated. Gold fully allocated. Crypto is the only sleeve sitting on its hands. Portfolio receipts, as always:
Two and a half, arguably three months range-bound. Before that: capitulation, a month and a half of base-building, a break higher, then a deeper leg down.
That sequence is literally what historical bottom formations look like. It’s also what a distribution range looks like until it isn’t. I’m not going to pretend to know which one this is in real time.. that’s what the signal is for.
Ethereum got the harsher treatment. It spent a month looking marginally stronger than BTC while going absolutely nowhere, then the signal went bearish and we exited entirely.
Gold is the actual bull market. Gap up August 5th, another gap later in the week, and it appears to have based right around the old mini-top. Full allocation, no hesitation.
On the discretionary side: still holding December 2027 IBIT calls plus a couple of put spreads, and running a bull put spread on SPY that keeps paying for the risk-on regime. The standing plan hasn’t changed.. if BTC revisits the 58-60k area, I add to LEAPS. Blood in the streets is a buy signal for the long end, not for the systematic sleeve.
Why things ground higher this week: inflation didn’t surprise anyone.
Core PPI came in better than expected
Core CPI in line
CPI m/m and y/y in line
Unemployment claims slightly lower
Core retail sales negative
Consumer sentiment soft
Nothing dramatic. “In line” was enough.
The more interesting print is FedWatch. September: 66.9% hold, roughly 1-in-3 odds of a hike. Out to January, there’s still a 24% path to two hikes, with 42% pricing one by year end. Not the cutting cycle everybody spent last year modeling.
How Warsh handles the next two meetings matters more than this week’s CPI did.
On-chain, the thesis is unchanged. Long-term holder supply in profit is sitting at levels that have historically marked cycle bottoms. The question was never whether.. it’s how long. Counting days from comparable setups puts the window around October.
The Bitcoin Sharpe ratio chart tells the same story from a different angle: we’re in the capitulation band that’s aligned with prior bottoms. Fair warning: previous cycles pushed all the way to -2.
A gentle reminder that “undervalued” and “done going down” are different statements.
Full cycle suite is free on the site: durdenbtc.com/charts.
The portfolio is risk on because the engine says risk on. Equities long, gold long, crypto at a probe, 21% in cash waiting.
Bitcoin will make a real move. Up or down.. I don’t have that answer and neither does anyone selling you one. What I do have is a system that sizes into the move after it starts instead of guessing before it does.
Three months of chop is boring. Boring is survivable. That’s the entire point.
Nothing changed this week. Sometimes that’s the update.
For this weeks full video breakdown:
— Durden out.
✊🧼
Disclaimer: This content is for educational and informational purposes only. It does not constitute financial advice, investment advice, or a recommendation to buy or sell any asset. Trading equities and futures involves substantial risk of loss, including the potential for loss exceeding your initial investment.
Past performance, whether backtested or live, does not guarantee future results. Backtested performance has inherent limitations: it is designed with the benefit of hindsight, does not reflect actual trading, and does not account for all factors that may affect real-world execution.
The author is not a licensed financial advisor. Always do your own research and consult a qualified financial professional before making investment decisions. You are solely responsible for your own trading decisions.
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