Yo Pit Crazies!

Bitcoin futures dropped under $87,000 – and that tells you everything about where this market is headed. 

Most people still think Bitcoin is digital gold. I’m seeing margin call triggers.

Bitcoin isn’t behaving like a store of value anymore. There’s leverage in it now. 

People borrowed against it at higher levels, and when futures crack key support like 87k, those margin calls start hitting. This isn’t Great Financial Crisis territory yet, but when people have to take losses somewhere, they’re going to sell their stocks and their good stuff to pay for those crypto losses.

Right now, Bitcoin is measuring the very speculative end of the market – and as of Friday, traders are dumping it hard.

My Perfect Setup Got Crushed

Here’s the thing that burns me: my prediction about 670 SPY by end of week and VIX trading the 19 handle came true Friday morning. Dead accurate for about 90 minutes. I was taking profits on SPY calls in Weekly Profit Cycles, VIX was down around 19-20, and everything looked perfect.

Then Bitcoin leverage killed the party.

NVIDIA (NVDA) earnings were fantastic – stocks were up 2.5% Friday morning, most names were flying. But when crypto started unwinding, tech joined the selling party. 

Nvidia finished down on the day despite beating numbers. 

Amazon (AMZN), going into Christmas season, down on the day. 

Total bloodbath.

How I Flipped Positions in Real Time

My prediction about 670 SPY by the end of the week and VIX trading the 19 handle came very true. It came true on Friday morning and lasted for about a solid hour to hour and a half. I was able to take some profits in some SPY calls on Riff Trades in Weekly Profit Cycles, which was nice. 

Then on the turnaround, I was able to ride and flip some VIX calls from my Riff Trade and in Weekly Profit Cycles.

The beauty of trading volatility is you can pivot when the market shows its hand. Bitcoin futures cracking 87k while everyone’s celebrating AI earnings? That’s your signal that leverage is unwinding somewhere dangerous.

Multiple Risk Factors Converging

This isn’t just crypto problems. We’ve got:

• Bitcoin leverage unwinding – The main event nobody’s watching
• Rate uncertainty – Fed’s probably not cutting in December
• Unintended consequences from Epstein release – Political noise
• Supreme Court eyeing tariffs – Policy uncertainty
• September jobs numbers – Nobody believed them anyway

When these factors pile up during leverage unwinds, selling accelerates.

All Bets Off for Volatility

I firmly believed we’d be in the 17-18 VIX range by next week. As of right now, I think we’re in uncharted waters.

Bitcoin futures sub-87k changes everything. This isn’t digital gold selling off – this is leveraged speculation getting margin called. And when crypto borrowers need cash, they sell their winning positions in stocks to cover losses.

I’ll hold my VIX call spreads a little longer. When leverage starts unwinding, volatility stays elevated until it’s finished.

The bottom line: NVIDIA earnings were perfect. Bitcoin leverage was perfect at destroying everything.

To Your Trading Success,

AG