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 showed strength but face potential short-term pullbacks amid bearish divergences and market consolidation, while ETF inflows and resilient traditional markets signal ongoing institutional demand and liquidity support despite U.S. political and regulatory uncertainties.
What’s Coming in Week 41
Bitcoin’s attempted breakout above 120K faces bearish divergence risk despite strong ETF inflows and euphoric sentiment, as smart money stays cautious, altcoins lag, and traders focus on structure and risk management amid a liquidity-driven market.
What does week 41 bring?
Monday, October 6
No major economic reports
Earnings Reports: Constellation Brands, Aehr Test Systems, Spire Global, Brand Engagement Network
Tuesday, October 7
Consumer Credit – important to monitor rising debt levels as a sign of pressure on households
Trade Balance – sheds light on export strength and potential GDP implications
Earnings Reports: McCormick, Penguin Solutions, Saratoga Investment Corp
Wednesday, October 8
MBA Mortgage Applications Index – gives insight into housing market activity and borrowing appetite
Earnings Reports: AZZ Inc., Resources Connection, Richardson Electronics, Bassett Furniture
Thursday, October 9
Initial Jobless Claims – delayed from last week due to government shutdown, signals labor market shifts
Wholesale Inventories – used as a growth and supply chain barometer
Earnings Reports: Applied Digital, Apogee, Delta Air Lines, Helen of Troy, Levi Strauss, PepsiCo, Neogen, Tilray, VinFast
Friday, October 10
University of Michigan Consumer Sentiment – expected to show slight weakness around 70, important for gauging demand outlook
Earnings Reports: 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
Bitcoin, Ethereum, Altcoins & Smart Money
Bitcoin recovered from its local low around 108K over the weekend, exactly where my short take profit triggered. The short is still running and my average entry is now close to 120K. BTC tried breaking its all-time high again this week but failed so far. Price action showed clear rejection near resistance, and with the weekly close approaching, a potential weekly bearish divergence could start forming. The last 3-day bearish divergence already brought us down to 108K and has still not been fully reset. For now this is not a good time to buy, only a clear invalidation and successful retest would make it a low-risk opportunity.
Ethereum did not outperform this week. In fact, ETH/BTC moved lower and Bitcoin dominance rose above 59 percent, showing clear strength in BTC over altcoins. Many traders are calling for another altseason and expect Bitcoin to shoot straight toward 150K without any pause, but I believe the market still needs more time to consolidate before the next leg higher. The current structure looks more like distribution than expansion, and patience is key here.
ETF flows returned strongly after last week’s outflows. Bitcoin ETFs saw renewed inflows, showing that institutional demand remains intact. ETH ETFs also recorded strong inflows, confirming that both majors continue to attract capital from traditional finance. Among altcoins, Solana is starting to stand out again as a strong play. With the SOL ETF in place and the Solana ecosystem expanding, once SOL treasuries begin to form we could easily see new all-time highs for Solana and its ecosystem coins.
Traditional Markets Snapshot
Traditional markets showed impressive resilience. The S&P 500 climbed to new all-time highs even in the midst of a government shutdown. While some U.S. government data releases were delayed, including key labor market numbers, risk assets rallied on expectations that fiscal disruption will be short-lived. Investor optimism remains strong across equities and crypto, supported by steady liquidity and improving ETF sentiment.
Politics & Regulation
The ongoing government shutdown in the United States led to the postponement of several important economic data releases, including the weekly jobless claims and monthly payrolls. Despite the political noise, markets reacted positively, expecting that a resolution will come quickly. On the regulatory side, crypto ETF optimism remained high after the SEC approved broader listing standards that could pave the way for additional products beyond Bitcoin and Ethereum.
Federal Reserve & Smart Money Signals
No major Fed announcements were made this week, but market participants continued to price in a stable rate outlook. Smart money flows indicate that large holders are gradually re-accumulating BTC and ETH on dips, while staying defensive in altcoins. The derivatives market showed calmer funding rates and reduced leverage compared to earlier in the month. Overall, liquidity conditions remain healthy, but the risk of a short-term pullback remains if bearish divergences confirm on higher timeframes.
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The Secret To Our Consistent Results
Crypto & Market Outlook
Bitcoin is attempting another breakout through the all-time high zone. If we close above 120K this week, we’ll begin the new week with a confirmed bearish divergence on the weekly chart. That could make follow-through risky even if price continues higher.
ETF inflows are strong. SPX is climbing into new highs. Sentiment across X is euphoric. But from a structural standpoint, Bitcoin is not in a clean expansion phase. The divergence risk remains and invalidation is not easy. A failed breakout here could lead to another sharp retracement.
For now, it’s a market driven by headlines and liquidity. Smart money is active but cautious. Retail is chasing. Altcoins continue to underperform unless tied to major narratives like Solana. Traders should stay focused on structure, risk management, and avoid emotional FOMO plays.
Key Catalysts to Watch
Bitcoin’s weekly close – determines if we start the week with a bearish divergence
University of Michigan Sentiment – potential driver for equities and crypto into the weekend
ETF inflows – signal institutional confidence or hesitation
SPX behavior near all-time highs – risk of double top or continued melt-up
SOL ecosystem – still one of the only alt narratives worth watching
Conclusion
Markets are bullish on the surface but carry hidden risks underneath. This is not the time to blindly chase green candles. Structure matters more than ever. Divergences are forming, liquidity is strong, but discipline is what separates smart money from retail.
Key Takeaways
Bitcoin showing strength but could soon be exhausted
Weekly bearish divergence in play unless invalidated above 120K
ETH underperforms, altseason is not here yet
ETF flows support majors, not the broader market
Solana remains the most promising alt narrative
This is where patience makes the difference. Let the structure guide you.
Don Diego
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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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