Two Analysts. Five Minutes. The Full Story.
An overview of the engine, the data, and why it’s so much more than just DCA.
HOW THE ENGINE WORKS
Every day, the engine aggregates and analyzes 19 economic and crypto indicators — pulling 25+ data points across 8 sources — then distills all of it into one score and one condition, telling you whether to invest, wait for data, or step back.
13 Indicators + 6 Override Triggers
Credit, fear, jobs, valuation & more — plus override triggers for extreme conditions
=
One Score
-100 to +100
updated daily
updated daily
→
One Condition
Buy, wait, or
step back
step back
13 indicators drive the daily score. 6 more act as override triggers and risk monitors that can change the signal independently.
The 13 Scored Indicators
1. Fear & Greed Index — crypto crowd sentiment (0 = panic, 100 = euphoria)
2. Dual Fear Signal — when both Wall Street (VIX ≥ 19.5) and crypto (F&G < 25) show fear simultaneously
3. VIX — stock market fear gauge
4. OAS — corporate credit spreads (borrowing costs)
5. Sahm Rule — unemployment momentum (recession indicator)
6. ISM Manufacturing PMI — factory activity (above 50 = growth)
7. ISM Services PMI — service sector activity (77% of GDP)
8. BTC vs 200-Day SMA — Bitcoin's position relative to its long-term average
9. MVRV Z-Score — Bitcoin valuation vs what holders paid
10. M2 Money Supply — global liquidity (more money = higher crypto, 60-90 day lag)
11. DXY — US dollar strength (weak dollar = crypto tailwind)
12. Stablecoin Market Cap — cash sitting on crypto sidelines
13. ETF Flows — institutional money flowing into/out of Bitcoin ETFs
The 6 Override Triggers
1. VIX > 45 + F&G < 25 → VERY FAVORABLE (dual capitulation)
2. VIX > 45 → FAVORABLE (extreme stock fear)
3. VIX 35-45 → NEUTRAL (falling knife pause)
4. OAS > 6% → DANGER (credit crisis)
5. Oil > $135 → DANGER (demand destruction)
6. Euphoria composite → CAUTIOUS (market overheated)
WAIT FOR Logic
The engine monitors 75+ upcoming economic events. When a major event is 1-2 days away (3 days for Fed meetings), the signal automatically switches to WAIT FOR — most market-moving price action happens within 24 hours of a data release.
THE SIX CONDITIONS
VERY FAVORABLE (+56 to +100) — Rarest signal. Historically the strongest accumulation setup.
FAVORABLE (+16 to +55) — Conditions are better than normal. Stick with or slightly increase regular DCA.
WAIT FOR (data pending) — Conditions are positive but major data is imminent. Wait for the number.
NEUTRAL (-9 to +15) — No strong edge either way. Keep standard DCA, no reason to change.
CAUTIOUS (-29 to -10) — Conditions deteriorating. Consider reducing until NEUTRAL or higher.
DANGER (-100 to -30) — Multiple warning signs. Consider pausing until NEUTRAL or higher.
The score almost never hits the extremes. Think of it like professional baseball: batting over .300 for a season is very good. A score in the +30s or +40s is the same idea — solidly in the Favorable zone.
REFERENCE GUIDE
▶ Start Here
TradFi Traditional Finance — banks, stock markets, bonds, and the Federal Reserve. The established financial system.
Why it matters: TradFi indicators (interest rates, credit, jobs) directly move crypto prices. This report reads both worlds.
Why it matters: TradFi indicators (interest rates, credit, jobs) directly move crypto prices. This report reads both worlds.
DeFi Decentralized Finance — financial services (lending, trading, savings) built on blockchain instead of banks.
Why it matters: DeFi growth drives demand for crypto assets and stablecoins. It's the reason crypto exists beyond speculation.
Why it matters: DeFi growth drives demand for crypto assets and stablecoins. It's the reason crypto exists beyond speculation.
DCA Dollar-Cost Averaging — buying a fixed dollar amount on a regular schedule, regardless of price.
Why it matters: This is the core strategy this report supports. DCA removes emotion and lets you accumulate at an average cost over time.
Why it matters: This is the core strategy this report supports. DCA removes emotion and lets you accumulate at an average cost over time.
Bitcoin (BTC) The first and largest cryptocurrency. A digital asset with a fixed supply of 21 million coins, secured by a global network.
Why it matters: BTC is the primary asset this report tracks. It leads crypto markets — when BTC moves, everything else follows.
Why it matters: BTC is the primary asset this report tracks. It leads crypto markets — when BTC moves, everything else follows.
Altcoins All cryptocurrencies other than Bitcoin — Ethereum (ETH), Solana (SOL), and thousands of others.
Why it matters: Altcoins are higher risk/reward than BTC. The engine tells you when conditions favor them vs when to stick with BTC only.
Why it matters: Altcoins are higher risk/reward than BTC. The engine tells you when conditions favor them vs when to stick with BTC only.
Stablecoins Cryptocurrencies pegged to $1 USD (like USDT, USDC). Used as “digital cash” within the crypto ecosystem.
Why it matters: A growing stablecoin market means cash is sitting on the sidelines ready to buy crypto. Shrinking = money leaving.
Why it matters: A growing stablecoin market means cash is sitting on the sidelines ready to buy crypto. Shrinking = money leaving.
Layer 1 (L1) Base blockchain networks like Ethereum, Solana, and Cardano that process transactions directly.
Why it matters: Capital flowing into L1s signals broader market recovery and real demand, not just speculation.
Why it matters: Capital flowing into L1s signals broader market recovery and real demand, not just speculation.
ETF Exchange-Traded Fund — lets you buy Bitcoin through a regular brokerage account (like Fidelity or Schwab).
Why it matters: ETF flows show whether large institutions (hedge funds, pensions) are buying or selling Bitcoin. Big money in = bullish.
Why it matters: ETF flows show whether large institutions (hedge funds, pensions) are buying or selling Bitcoin. Big money in = bullish.
▶ What the Engine Tracks
OAS The extra interest risky companies pay to borrow. Low = healthy. High = trouble. Above 4.50% = stress. Above 6% = DANGER override.
VIX Stock market fear gauge. High = fear = historically good entry points. Above 45 = maximum conviction.
F&G Crypto Fear & Greed. 0 = max panic, 100 = max greed. Below 25 = extreme fear = best accumulation window.
Dual Fear VIX ≥19.5 + F&G <25. Both crowds panicking. Engine's strongest signal.
ISM PMI Factory (Mfg) and service (Svc) activity surveys. Above 50 = growing. Services = 77% of GDP.
Sahm Rule Recession indicator tracking unemployment momentum. Above 0.50 = recession likely.
200d SMA Bitcoin's 200-day average price. Key trend line. 15%+ below = altcoins historically underperform.
MVRV Z-Score Compares BTC price to what holders paid. Below 2.5 = undervalued. Above 5 = cycle top risk.
M2 Global money supply. Growing M2 flows into crypto with 60-90 day delay.
DXY US Dollar strength. Weak (<100) = tailwind for crypto. Strong (>106) = headwind.
Brent Crude Global oil price. $110+ = score penalty. $135+ = DANGER override.
Stablecoin MCap Total stablecoin value. Growing = cash waiting to buy. Shrinking >5% = money leaving.
ETF Flows 5-day net into US spot Bitcoin ETFs. >$500M = strong bullish. <-$500M = institutions pulling back.
BTC Dominance Bitcoin's share of total crypto. >63% = hedge mode. 50-55% = altseason. <50% = full alt.
▶ Pro Insight Terms
Liquidation Forced closure of leveraged positions. High volume often marks local bottoms.
Longs Traders betting price goes UP. When liquidated = buyers forced to sell = potential capitulation.
Shorts Traders betting price goes DOWN. When liquidated = forced buying = short squeeze.
Leverage Borrowing to trade bigger. 10x = 10% move wipes you out. High leverage = fragile market.
▶ Economic Events
FOMC Fed rate decisions. BTC swings 5-15% within 24 hours.
CPI Consumer inflation. Most-traded macro release for crypto.
PCE Fed's preferred inflation measure. Directly influences rate cut timing.
PPI Wholesale prices. Leads CPI.
GDP Economic growth. Two negative quarters = recession.
NFP Monthly jobs report. Updates Sahm Rule.
Dot Plot / SEP Fed rate projections. Published 4x/year. Shifts move billions.
Yield Curve Short vs long bond rates. Inversion historically precedes recession 12-18 months later.
BTC Dominance Phases
>63% HEDGE MODE — altcoins extremely weak, Bitcoin only
58-63% DEFENSIVE — altcoins lagging, reduce altcoin exposure
55-58% TRANSITION — altcoins recovering, mixed signals
50-55% ALTSEASON — altcoins outperforming, broader portfolio works
<50% FULL ALT — max altcoin momentum, take profits on runners
MIDTERM CYCLE ANALYSIS
Election: November 3, 2026
DRAWDOWN PHASE
BTC Midterm Avg
-56%
Drawdown before
BTC Post-Midterm
+54%
Avg 12mo after
S&P Post-Midterm
+19%
Avg 12mo after
S&P Negative After
0
Since 1939
Historically the weakest period of the cycle. If the pattern holds, the post-election rally window opens in November.
Prior Midterm BTC Bottoms
2014 — BTC bottomed ~$200 during midterm year, rallied to $20K by 2017
2018 — BTC bottomed ~$3,200 during midterm year, rallied to $69K by 2021
2022 — BTC bottomed ~$15,500 during midterm year, rallied to $109K by 2025
The 5-Year Cycle Thesis
Raoul Pal's liquidity argument: global M2 money supply drives a roughly 4-5 year boom/bust cycle in risk assets. Midterm election years consistently align with the bottom of this cycle — when liquidity tightens, fear peaks, and the best accumulation opportunities appear. The pattern has held for three consecutive cycles.
Clarity Act Status
The Financial Innovation and Technology for the 21st Century Act (FIT21) passed the House in 2024. If signed into law, it would create the first comprehensive U.S. regulatory framework for digital assets — separating securities from commodities and giving the CFTC primary oversight of most crypto. Clarity reduces regulatory risk and historically correlates with institutional adoption.
BACKTESTED ACROSS 8 YEARS OF MARKET DATA
Engineered across over 3,100+ days of market data (2017 to 2025). The engine caught 21 of 24 major events where macro data provided advance signals.
Key Backtested Events
✓ 2018 Crypto Winter — Engine flagged deteriorating conditions as BTC fell from $20K to $3.2K
✓ COVID Crash (March 2020) — VIX override triggered FAVORABLE at the bottom, one of the best accumulation windows in history
✓ 2022 Bear Market — OAS and fear indicators flagged risk before the major drawdown
✓ Oct 2025 Cycle Top ($126K) — Euphoria composite triggered CAUTIOUS near the peak
Validation Methodology
Out-of-sample validation (2017-2019) was performed on data not used during calibration. The engine was calibrated on 2020-2025 data, then tested backwards to verify the signals would have held on data the engine had never seen.
What It Missed (3 of 24)
The engine missed 3 events where the catalyst was purely idiosyncratic (exchange-specific collapses, regulatory surprises with no macro lead) rather than macro-driven. The engine reads economic data — it cannot predict fraud, hacks, or sudden regulatory action. Transparency matters: no system catches everything.
SAMPLE REPORTS — SEE THE ENGINE IN ACTION
See how the signal responds to real market events. These reports are fully unlocked so you can explore the complete analysis.
W
FAVORABLE → WAIT FOR
Signal changed ahead of CPI release — the engine paused the buy signal until data cleared.
F
WAIT FOR → FAVORABLE
Data came in cool — the engine cleared the hold and restored accumulation signal.
C
CAUTIOUS Day
Multiple indicators deteriorated simultaneously — the engine pulled back the signal.
Links to specific past reports will be added as the archive grows.
This is NOT financial advice. HUD DCA™ provides market condition assessments for informational and educational purposes only. HUD DCA™ LLC is not a registered investment adviser, broker-dealer, or commodity trading advisor. All historical results are hypothetical, backtested with the benefit of hindsight, and do not represent actual trading. Model parameters were optimized using historical data. Out-of-sample validation (2017–2019) was performed on data not used during calibration. Digital assets are highly volatile and involve substantial risk of total loss. Past performance is not indicative of future results. Consult a qualified financial advisor before making investment decisions.