Hey Trader,
Welcome to the weekly Velaris Trading Newsletter – your source for real market insight, no fluff, no noise.
Here’s this week’s newsletter breakdown:
Brief Overview
Weekly Market Recap
Bitcoin and Ethereum stayed range-bound with bearish setups, as BTC stalled and ETH lagged, while sentiment soured on MicroStrategy’s S&P 500 rejection and macro uncertainty. Equities swung on labor data and politics, with heavy tech insider selling and record hedge fund shorting in S&P futures highlighting broad market caution.
What’s Coming in Week 37
Week 37 could be pivotal, with CPI, PPI, and consumer sentiment driving Fed expectations and sparking volatility. Bitcoin remains stuck between 112K and 108K with bearish divergences that could lead to sub 100K if support breaks, while Ethereum looks weaker still. Equities hit new highs but face fading momentum, heavy insider selling, and record hedge fund shorts, limiting upside. Key catalysts are CPI, PPI, inflation expectations, positioning flows, and Bitcoin’s 108K level.
What does week 37 bring?
Monday, September 8
Consumer Credit – Measures the change in the total value of outstanding consumer credit. A sharp rise may signal increased borrowing stress.
Earnings: Casey’s General Stores (CASY)
Tuesday, September 9
NFIB Small Business Optimism – Sentiment gauge for small firms. A drop could hint at future employment softness.
Earnings: Core & Main (CNM), SailPoint (SAIL), Oracle (ORCL), Synopsis (SNPS), Rubrik (RBRK), GameStop (GME)
Wednesday, September 10
PPI & Core PPI – Expected higher after last month’s surprise uptick. Watch for signs of continued producer inflation.
Wholesale Inventories & MBA Mortgage Applications – Important for tracking credit demand and supply chain stress.
Earnings: Chewy (CHWY), Manchester United (MANU)
Thursday, September 11
CPI & Core CPI – Most important print of the week. CPI expected higher. Markets will watch core inflation for signs of stickiness.
Initial & Continuing Claims – Labor market health check.
Earnings: Kroger (KR), Adobe (ADBE), RH (RH)
Friday, September 12
University of Michigan Sentiment (Prelim) – Consumer sentiment, current conditions, and inflation expectations (1yr and 5-10yr).
Earnings: None
IMPORTANT: The expectations of the respective economic data may change in the course of the week. They will be updated in the Discord and will be discussed in more detail.
Weekly Market Wrap
Crypto Market Recap
Bitcoin started the week at around 108K, slipping to 107K as expected, where it found support at the bull market support band. Into mid-week, BTC pushed toward 112K, but ultimately stayed in the 112K-108K range. On Friday, weaker-than-expected labor market data briefly lifted BTC in hopes of more rate cuts. That rally was short-lived, as sentiment turned negative when MicroStrategy was not accepted into the S&P 500, dragging prices back. On the HTF, the structure remains bearish, and I continue to expect Bitcoin to trade below 100K in the coming weeks. On the LTF, short bursts of bullish momentum are possible.
Ethereum mirrored BTC but showed more weakness against it. A clear HTF bearish divergence has formed, likely to play out over a longer timeframe, similar to the path of BTC dominance. ETH held support around 4.2K, but its relative weakness is notable.
Traditional Markets & U.S. Politics
Equities were volatile. The S&P 500 weakened early in the week, pressured by bond market stress and renewed political concerns, then stabilized midweek before rallying on Friday after weaker jobs data. That move, however, was quickly faded. On the macro side, PCE and Core PCE came in as expected, but with PPI and PCE both rising, it will be difficult to justify more than a single 25bps cut. This explains the slight dollar strength after the data. A September cut is nearly certain, but the mid-term policy outlook will hinge on the next FOMC.
Political noise also continued to weigh, with Trump’s attacks on Fed independence unsettling markets. The balance between monetary policy and political influence remains a risk factor that investors cannot ignore.
Insider Selling & Hedge Fund Positioning
Insiders are selling. The wave is massive across big tech and fintech. Executives at MSFT, SNOW, HOOD, AFRM, SOFI, NFLX, DDOG, NVDA, GOOG, and AAPL are unloading tens to hundreds of millions in stock. This is not a one-off trimming - it’s systemic. The Walmart family trusts cashed nearly $1B. Satya Nadella at Microsoft, Frank Slootman at Snowflake, Jensen Huang at Nvidia, Mary Barra at GM, Max Levchin at Affirm, and Anthony Noto at SoFi all joined the selling. Very few insiders are buying. CEO and Chair-level sales are the most sensitive because they directly dent investor confidence. Right now, the boardroom class is offloading, not accumulating - a broad, cautious signal, especially for tech and by extension crypto.
Hedge funds are also loading up on shorts. Short positioning in S&P 500 futures has surged to a record $180 billion. Since April’s low, short exposure has risen by about $75 billion, surpassing the prior record near $170 billion set in January. Hedge fund short exposure now stands at roughly 27% of open interest, the highest since mid-2023. For context, at the 2022 bear market low, it was about 31%. This does not necessarily mean funds are predicting an imminent correction, but it does show that institutional players are aggressively hedging.
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The Secret To Our Consistent Results
Crypto & Market Outlook
Week 37 could mark a turning point. CPI, PPI, and consumer sentiment will either validate a late-cycle inflation bounce or signal cooling that allows the Fed to ease in Q4. Either scenario brings volatility.
Bitcoin sits in a critical HTF range with a bearish 3 day bearish divergence that still hasn’t fully played out. As long as we stay below 112K and above 108K, chop continues. A confirmed break below 108K and below the bull market support band opens the path to sub 100K. Ethereum looks weaker, with bearish divergence on the HTF and on the ETH/BTC pair.
I expect lower levels in September in the crypto market.
SPX is holding strong after making a new all-time high on Friday, but momentum is fading. If CPI or sentiment surprises to the upside, we may see ongoing strength. Still, heavy hedge fund shorts and ongoing insider selling limit upside potential.
In general, if we see CPI coming higher than expected, that would put more pressure on the Fed. The Fed is working on a double mandate. Lower inflation but also strengthen the economy and labor market. While lowering interest rates sounds like a no brainer, it isn’t. Lowering too fast could lead to more inflation, while lowering too late could risk a deeper recession and if inflation stays elevated at the same time, even stagflation.
Key Catalysts to Watch
CPI & Core CPI (Thursday) – Will set near-term Fed policy. A sticky core above expctations could kill the soft landing narrative.
PPI (Wednesday) – Often front-runs CPI. A surprise here could shift risk appetite early.
Insider & Hedge Fund Positioning – Continued insider selling and record SPX shorts could spark broader risk-off.
Bitcoin 108K – Critical HTF zone to watch for breakdowns or rebounds.
Inflation Expectations (Friday) – If long-term expectations tick higher, the Fed’s credibility faces pressure again and interest rate cuts in Q4 become more unlikely.
Conclusion
Week 37 is a pressure cooker. With Bitcoin at range-bound, and macro risk rising, we expect decisive moves post-CPI. Whether the Fed can still steer this soft landing narrative or if markets start calling the bluff, will be revealed in the coming days.
Key Takeaways:
CPI Thursday is the make-or-break moment.
Bitcoin structure favors a move under 100K unless 112K breaks, but any retest of 114K-118K is likely just a bearish retest.
Ethereum remains weak vs BTC, not a leadership asset this week.
Insider selling and hedge fund shorts = caution from smart money.
Trump-Fed drama adds political instability to an already fragile market.
Stick to the plan. Trade with clarity. Ignore the noise.
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To a successful week ahead - and stay tuned for more weekly insights into the crypto and financial markets.
Stay focused. Stay rational.
Kind regards,
Don - Founder of Velaris Trading
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