Lesson 4
Crypto Regime Trading
Know your regime before sizing crypto positions. Maximum aggression in Reflation, maximum defense in Air Pocket. Crypto is a levered bet on liquidity — don't fight the regime.
📊 Indicators mentioned in this lesson (click for details):
Different macro regimes create different crypto environments. Match your crypto strategy to the regime.
Regime 1: Reflation (Best for Crypto)
- Liquidity rising, DXY falling
- Real rates low/negative
- Risk-on across asset classes
- Strategy: Maximum BTC (BTCUSD), altcoin exposure
Regime 2: Air Pocket (Worst for Crypto)
- Liquidity falling, DXY rising
- Real rates rising
- Risk-off, flight to USD
- Strategy: Reduce exposure, raise cash/stablecoins
Regime 3: Real Rate Squeeze (Mixed)
- Inflation falling faster than rates cut
- Real rates high
- Stocks may do OK but crypto suffers
- Strategy: Underweight crypto vs. equities
Regime 4: Debasement (Bullish Long-Term)
- Massive money printing
- Currency confidence eroding
- BTC (BTCUSD) as 'digital gold' narrative
- Strategy: Accumulate BTC (BTCUSD), avoid leverage
Altcoin vs BTC (BTCUSD) Relative Strength:
- Risk-on environment: Altcoins outperform BTC (BTCUSD)
- Risk-off environment: BTC (BTCUSD) outperforms altcoins
- Regime uncertainty: BTC (BTCUSD) dominance rises
Track BTC (BTCUSD) dominance as a crypto risk indicator.
Check your understanding
Lesson Quiz
Quiz Check
The regime is Air Pocket (liquidity falling, DXY rising, real rates rising). How should you position your crypto allocation?