Netizen Premium | Bitcoin Deep Dive #35

Bitcoin Volatility Returns Despite Bullish Macro

Macro Still Favors Risk Assets

The overarching liquidity environment remains constructive despite Bitcoin’s recent stumble from $125K to $103K. We remain in a risk-on GOLDILOCKS market regime while the Fed continues signaling accommodation rather than restraint. The S&P 500 maintains BULLISH momentum, gold is at new all-time highs above $4.2K, and volatility indices across equity, bonds, and currency markets remain BEARISH. All of these are textbook signs of a risk-on backdrop where liquidity is expanding and capital is hunting for returns. Meanwhile, the US Dollar remains in BEARISH momentum, and oil recently transitioned from neutral to BEARISH momentum, which historically correlates with expanding global liquidity and supportive conditions for risk assets. Meanwhile, the bottom-up macro regime is also signaling a risk-on REFLATION in the next 3-6 months, which should be supportive of Bitcoin and stocks.

TLDR: Cross-asset momentum and global liquidity indicators point to a RISK-ON environment that typically supports Bitcoin and stocks.

Bitcoin Momentum Breakdown Warrants Caution

That said, Bitcoin’s shift from BULLISH to NEUTRAL volatility-adjusted momentum is worth calling out. As a 24/7 market and one of the largest risk assets globally, Bitcoin often signals ahead of broader market moves, so this momentum breakdown deserves attention and warrants caution in the near term. However, this appears to be a technical signal reflecting the need to digest gains after the run to $125K, rather than a fundamental deterioration in the macro conditions that drove the rally. The cross-asset backdrop and liquidity indicators suggest this is volatility within a bullish structure, not a regime change. When Bitcoin’s technical signals diverge from macro fundamentals, history shows the fundamentals eventually win out.

TLDR: Bitcoin’s momentum breakdown to NEUTRAL is a legitimate near-term warning, but the underlying macro support remains intact, suggesting this is a technical correction rather than a structural shift.

The Everything Rally Thesis Strengthens

What we’re experiencing is a structural regime shift where fiscal dominance and monetary accommodation create the perfect storm for hard assets. Powell’s October 15 speech confirmed the Fed is preparing to end balance sheet runoff and deliver another rate cut before year-end, prioritizing liquidity over inflation discipline. Treasury Secretary Bessent floated extending tariff relief on Chinese imports, signaling that trade policy will bend toward maintaining growth rather than risking a slowdown. Meanwhile, the Trump administration is pushing full throttle with deregulation, AI infrastructure spending, reshoring incentives, and looming tax cuts that will flood the US economy with more dollars. This is the playbook for currency debasement masquerading as economic policy, where governments choose to grow their way out of debt rather than tighten into recession. Bitcoin and gold exist precisely for this environment, where trust in fiat purchasing power erodes and capital seeks refuge in assets with provable scarcity. The recent volatility reflects tactical positioning within this larger structural shift, not a breakdown of the thesis itself.

TLDR: Fiscal and monetary policy are converging on a path of currency debasement that validates the long-term case for Bitcoin and gold, even as short-term volatility creates noise around the signal.

The macro picture confirms liquidity support remains intact and policy is tilting toward debasement. Now we turn to Bitcoin’s on-chain data to verify whether the correction reflects structural weakness or not.