🥛 BTC needs to hold this level 😬

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Here’s what we’ve got for you today:

✍️ BTC needs to hold this level.
🎙️ The Milk Road Show: Wall Street Could Be the Catalyst DeFi Is Waiting For.
🍪 Coinbase is changing the name of the Base App back to Coinbase Wallet.

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BTC NEEDS TO HOLD THIS LEVEL BY SUNDAY 😬

On Monday, we asked the market gods for two things:

Keep the stock/meme pairing craze on Robinhood Chain going.
Have Bitcoin hold $79-80K and confirm the bull run.

We're one for two right now.

DEX volumes on Robinhood Chain hit an all-time high twice this week, while chain fees dropped to their lowest since August.

I.e. There’s more trading than ever on Robinhood Chain, and folks are paying less to do it. It’s a beautiful combo. 👇

Source: DefiLlama

And remember - memecoins are just the beginning here…

Ish Asad from Bitwise made the point on The Milk Road Show yesterday: the memecoins themselves are throwaway trades, but real businesses are forming on Robinhood Chain and pulling in real fee revenue.

Which is exactly what we like to see.

It’s the BTC price where we’re left wanting right now…

Bitcoin's just shy of our desired ~$79K level at the time of this writing ($78.5K, up from its $76.5K low yesterday) - but as John mentioned on Monday, he needs it to close the week at or above $79K before he'll call the bull run confirmed, and weekend trading is famously volatile.

… so why all the uncertainty in price?

In a word: Macro.

New PPI data (which tracks wholesale inflation) was released yesterday, showing it reaccelerated in August to +0.4% for the month, after just +0.1% in July.

And then this morning, CPI landed…

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BTC NEEDS TO HOLD THIS LEVEL BY SUNDAY (P2) 😬

Here's what August's inflation data looked like:

Headline CPI: +0.4% for the month, +3.4% over the year. Matching expectations.
Core CPI (strips out food and energy to show the trend underneath): +0.3% against +0.2% expected.

That 0.3% is (sadly) the more important of the two numbers - and it’s actually something John highlighted three days ago.

In his Tuesday macro brief, he wrote that a core monthly figure at or above 0.3% would flip the inflation axis positive, erode the macro buffer, and drag market momentum back toward zero.

His words: that would "point the posture of the index [Milk Road Macro Index / MRMI] back towards a RISK OFF" signal.

And wouldn’t you know it - we got +0.3% exactly in today’s release.

The cool part: our MRMI (which scores how friendly the macro backdrop is to taking risk) put its omniscience on full display and actually moved ahead of the CPI release, sitting at -0.60 and saying RISK OFF as of yesterday morning.

(Bravo to M0xt, the nerd who built it.) 👇

Source: Milk Road Macro Index

The MRMI was dragged down by sector breadth (how many parts of the market are actually participating in price movement, versus a handful of names carrying the whole thing).

Growth impulses and financial conditions are still holding though - which is a saving grace.

M0xt's now watching where SPY (the fund that tracks the S&P 500) closes today.

If it finishes below $760 (and below its 50-day moving average), he thinks equities will go further down - and if equities are struggling, crypto often follows.

But before you go and panic…

The worry driving all of this is a potential rate hike (odds of a September one have been hovering around 60% for a few weeks now).

But John's been saying all year that the new Fed chair, Kevin Warsh, will do everything he can NOT to pull that trigger.

The way he sees it, Warsh is paddling the boat toward holding steady, and then cutting.

And he wrote Tuesday's brief knowing this exact scenario was on the table.

He laid out the hot-CPI path, then signed off saying he's not concerned about inflation, rate hikes, or the setup for the market right now. He's expecting plenty of volatility and thinner volume heading into the midterms. But he still thinks the bull market recovers and stays strong.

On top of that, the economy underneath all this is also doing just fine. Payrolls came in at 162K against a 53K consensus, and GDPNow (the Atlanta Fed's running growth estimate) has Q3 at 4.7%.

Which puts three things on the scoreboard this week and next:

FOMC next Wednesday. The Fed announces its rate decision at 2pm ET on the 16th.
SPY holding $760. Lose that and the 50-day, and M0xt expects more downside in equities.
Bitcoin at $79K on Sunday's close. John's bull market confirmation level.

As a result, we'll be setting multiple alarms over the next 5 days.

P.S. Want to see how John's navigating all of this in real time? You can get access to his exact trades, as they happen, inside Milk Road PRO (all for a buck).

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