VIX Signal and Crypto Relative Strength Support Near-Term Bullish Bias

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Discussed in today’s video:

• Relative Strength: Crypto demonstrated notable resilience today despite meaningful weakness in traditional risk assets. At one point, both the S&P 500 and Nasdaq were down more than 2% intraday, while BTC and the broader crypto complex held up comparatively well. This continued relative strength is consistent with the “bottoming on bad news” dynamic we highlighted over the weekend and again yesterday.
• Crowded Trades Unwinding: Some of today’s weakness in traditional markets appeared concentrated in crowded positions. Gold, MAG7, KOSPI, and NIKKEI all sold off sharply. The read-through is that broader de-risking may be occurring in crowded exposures, while crypto positioning appears comparatively light. In the current range, there appears to be a relative absence of sellers, barring the emergence of a new negative catalyst.
• Volatility Signal: The VIX crossed 27 intraday today, marking the seventh instance of such a move since 2024. Historically, BTC forward returns following these events have leaned constructive. While the seven-day win rate is roughly 50%, it improves to about 67% at the 14- and 30-day horizons. Returns have tended to be particularly favorable when BTC has been underperforming into the volatility spike, which aligns with the current setup.
• Policy Development: President Trump publicly called for banks to engage constructively with the crypto industry regarding negotiations around the Clarity Act, while criticizing attempts to undermine the Genius Act. The comments suggest the administration may be less aligned with banking-sector opposition to stablecoin yield pass-through than previously assumed. If negotiations move forward constructively, this would represent a positive development for the industry and could support sentiment toward crypto-native platforms, such as (COIN is probably a beneficiary of any yield pass-through narrative).
• Macro Risks Persist: While near-term price action has been constructive, broader macro headwinds remain. Credit spreads widened again today, forward rate expectations have begun firming after last week’s decline, and stress in private credit markets continues to emerge. These factors reinforce the idea that any near-term rally should still be approached tactically.
• Bottom Line: Crypto’s continued relative strength amid equity weakness and rising volatility keeps the prospect of a near-term rally firmly on the table. While macro risks remain elevated, the combination of light positioning, constructive volatility signals, and incremental regulatory tailwinds suggests the near-term risk-reward remains skewed to the upside. This is likely a rally to rent rather than own, but the tape continues to behave constructively for tactical longs.

Tickers in this video: BTC -0.45%