Macro Context & Alignment
How traditional market conditions adjust position sizing without changing the BTC regime.
Core design principle
Macro context never changes the BTC regime direction. It only adjusts position sizing.
If the BTC regime is RISK-ON and macro is Risk-Off, you remain bullish on BTC, but at reduced size. The macro overlay is a risk management lever, not a signal override.
Three independent macro votes
Each indicator votes independently. Votes are summed (range: −2.5 to +2.5) to determine macro context.
US Dollar Index (DXY)
weight: 1.0A weaker dollar makes risk assets like BTC more attractive to global investors. A strengthening dollar draws capital toward USD-denominated safe assets.
| Condition | Vote | Macro signal |
|---|---|---|
| DXY trending down + below 200D MA | +1 | Risk-On |
| Mixed or flat signals | 0 | Neutral |
| DXY trending up + above 200D MA | −1 | Risk-Off |
Real Yields (US10Y)
weight: 1.0Higher real yields increase the opportunity cost of holding non-yielding assets like BTC. Falling yields remove this pressure and make risk assets more attractive.
Note: Real yield approximated as nominal US10Y − 2.5% (assumed inflation).
| 30-day yield change | Vote | Macro signal |
|---|---|---|
| < −0.2% | +1 | Risk-On: falling yields reduce headwind |
| −0.2% to +0.2% | 0 | Neutral: stable rates |
| > +0.2% | −1 | Risk-Off: rising rates increase headwind |
Equity Risk (SPX & VIX)
weight: 0.5BTC often correlates with broad risk appetite. Equity strength + low fear = constructive environment. Lower weight (0.5) because the BTC–equity relationship breaks down during crypto-specific events.
| Condition | Vote | Macro signal |
|---|---|---|
| SPX above 200D MA AND VIX < 20 | +0.5 | Risk-On: healthy equity environment |
| Mixed (one condition met) | 0 | Neutral |
| SPX below 200D MA AND VIX > 20 | −0.5 | Risk-Off: equity stress |
Macro Context Classification
The three votes are summed (total range: −2.5 to +2.5) to classify the macro environment:
| Total vote score | Classification | Meaning |
|---|---|---|
| ≥ +1.5 | Macro Risk-On | Traditional markets supportive of risk assets |
| −1.0 to +1.4 | Macro Neutral | Mixed signals: no clear tailwind or headwind |
| ≤ −1.5 | Macro Risk-Off | Traditional markets creating headwind for BTC |
Alignment Matrix & Position Sizing
Once both the BTC regime and macro context are determined, cross-reference them to find the appropriate position size conviction level.
| BTC Regime | Macro Risk-On | Macro Neutral | Macro Risk-Off |
|---|---|---|---|
| RISK-ON | ✅ 100% | ⚠️ 75% | ❌ 50% |
| CAUTIOUS-BULL | ✅ 100% | ⚠️ 75% | ❌ 50% |
| NEUTRAL | ⚠️ 75% | ⚠️ 75% | ⚠️ 75% |
| CAUTIOUS-BEAR | ❌ 50% | ⚠️ 75% | ✅ 100% |
| RISK-OFF | ❌ 50% | ⚠️ 75% | ✅ 100% |
BTC and macro agree on direction. Full conviction to size your position.
Mixed signals or a neutral macro reading. Slightly reduced size is prudent.
BTC and macro disagree. Significant headwind present: cut size in half.
Historical examples
Q1 2024: Perfect alignment
May 2022: Macro headwind correctly sized down exposure
Late 2023: Neutral on both, patience rewarded
Key takeaways
- → Macro adjusts size, not direction. Never override a bullish BTC regime to zero just because macro is Risk-Off.
- → Three independent votes prevent any single indicator from dominating the macro assessment.
- → Perfect alignment (100%) is less common than mixed signals. Treat 75% sizing as the normal state.
- → Divergence is a risk signal, not a stop signal. Use it to right-size, not to exit entirely.