Sophia

The Risk Index is repeating a familiar sequence. In 2022, every wave of risk acceleration translated into new downside. That pattern usually unfolds as: Acceleration → Capitulation → Deceleration → Re-acceleration Once the Risk Index accelerated, Bitcoin was pushed into capitulation, falling as much as -20% before risk even began to decelerate. In 2026, we’ve already seen the capitulation phase and a period of partial stabilization. Now risk is rising again.

Well, we smashed through the first major area of support on the $SPX so at this stage I would say this pullback is actually quite significant. Zooming out as a reminder that we are likely in the final innings of what has been a secular bull market since 2008 (if we haven't already topped). We can see that the wave structure is pretty clean/clear leading into this final 5th wave. Which means, we are overdue for a major, massive market correction "of a higher degree", similar in time/magnitude to what we saw during the 2000-2008 period. The big question is, has that correction already begun and have we just seen the top in trad markets for the coming 5+ years, OR are we still working on that final, parabolic, blow off top that has clearly been in the making for years? It's important to note that as we see a final, cycle ending parabolic advance- it's common to see very aggressive/fast/deep pullbacks on the way up as we approach the top of the parabola. We go up quicker than ever before, with sharp shakeouts in between, until finally, something breaks. For perspective, the last two major corrections on the SPX were 35% in 2020 and 28% in 2022. These were both followed by new ATH. Our current correction is about 17% off the top, so at current depth it's similar in magnitude to our last couple intra-cycle corrections. However, if we are still working on this parabolic advance and the top isn't in, major areas of HTF demand/support should be respected. Our next main area of HTF demand/support is at 4100-4600- about 10-15% lower from current levels. This would be, imo, the last acceptable bounce zone if we are to continue our parabolic ascent. Lose it, and I would have to lean towards our cycle top on the SPX already being in. $ES

*TREASURY 30-YEAR YIELD RISES TO 4.986%, HIGHEST SINCE SEPTEMBER

In case you don't realize what just happened: MARA sold 15,000 BTC, Bitdeer sold all of its BTC, Riot is selling BTC from treasury to fund data center build-outs, Auradine just rebranded to Velaura AI. The biggest miners are leaving the game. Not necessarily because it's broken, but because AI pays more per megawatt. Think about what this means: These aren't small players. They find thousands of blocks and move global hashrate. When they redirect capital and infrastructure toward AI, that hashrate comes offline. Unless equivalent hashrate fills the gap, difficulty drops. And it doesn't seem the the gap will be filled in the near term because the whole reason they're leaving is better margins elsewhere. Lower difficulty = higher margins for every miner who stays. And there's a second layer here. If the Strait of Hormuz stays closed into April, energy prices climb. Oil-dependent miners get hit hardest. This might be the best setup small/medium miners with stable PPA's have seen since the 2021 China mining ban.