Analyst’s warning – Bitcoin’s early-2026 rebound could precede a major crash!

The cryptocurrency market, particularly Bitcoin, continues to be a subject of intense speculation and analysis. As 2025 draws to a close, a significant warning from market analysts suggests a potential rebound for Bitcoin in early 2026 could be a precursor to a more substantial market downturn. This perspective urges caution, advising investors to look beyond immediate gains and consider broader macroeconomic shifts that could influence Bitcoin’s trajectory.

Bitcoin’s Recent Movements and Historical Parallels

Recent Bitcoin price action has exhibited notable similarities to patterns observed earlier in 2025, specifically around March. Both periods saw Bitcoin break down from a three-month consolidation range, a pattern that consistently followed the establishment of new all-time highs. This recurring behavior suggests that while a new peak might generate bullish sentiment, it can also lead to a period of correction or consolidation. The formation of a “death cross” has further fueled discussions about potential market bottoms or continued bearish pressure. Historically, such formations have often coincided with market bottoms, prompting close observation of Bitcoin’s response in the subsequent weeks.

The Analyst’s Warning: A Potential “Macro Lower High” in Early 2026

According to analysis from market observer EndGame Macro, drawing on insights from other financial analyses, Bitcoin is anticipated to find support and experience a bounce in early 2026. However, this projection comes with a crucial caveat: this rebound might not signal the commencement of a new bullish rally, as seen in previous instances during April and May of 2025. Instead, analysts warn that this bounce could represent a “macro lower high,” a temporary recovery within a larger downtrend. Such a scenario could lull investors into a false sense of security before the market potentially declines further into a bear market, particularly by the second quarter of 2026.

Key Factors Influencing a Potential Q2 2026 Slump

Several macroeconomic and market-specific factors are cited as potential drivers for a significant downturn following an early 2026 rebound:

Tightened Liquidity Conditions

One primary concern revolves around the tightening of liquidity conditions, expected to become more pronounced during the tax season. The U.S. Treasury’s efforts to build up its Treasury General Account (TGA) are anticipated to withdraw liquidity from the financial system. Historically, periods of reduced market liquidity often correlate with decreased risk appetite among investors, which could disproportionately affect riskier assets like Bitcoin. This squeeze on available funds could create an unfavorable environment for sustained upward price movement in the cryptocurrency market.

U.S. Dollar Index (DXY) Trends

The strength of the U.S. Dollar, as measured by the U.S. Dollar Index (DXY), serves as a crucial macro signal for global investors. A rising DXY generally indicates a stronger dollar, often correlating with reduced appetite for risk-on assets, including Bitcoin. Conversely, a weakening dollar typically suggests increased risk-taking sentiment. While the DXY has generally maintained a bearish structure as of November 2025, providing a positive signal for Bitcoin, this trend could quickly reverse.

Federal Reserve Rate Cut Uncertainty

Uncertainty surrounding potential Federal Reserve interest rate cuts further complicates the outlook. The probability of a rate cut in December has significantly decreased, falling to 44% from 88% a month prior. This shift in expectations can impact the DXY and broader market sentiment. If the Federal Reserve maintains a more hawkish stance or delays rate cuts, the dollar’s downtrend could be arrested, potentially adding pressure to Bitcoin and other cryptocurrencies.

Bitcoin ETF Outflows

Recent data from Exchange-Traded Funds (ETFs) tracking Bitcoin also points to an underlying weakness in investor sentiment. Since a market correction in October, Bitcoin ETFs have experienced substantial outflows, reflecting a cautious or bearish disposition among investors. While these outflows alone do not guarantee sustained losses, they highlight a current lack of strong buying pressure, making the market vulnerable to further price depreciation.

Navigating Technical Indicators: The Death Cross and $110,000 Threshold

Prominent analyst Benjamin Cowen has highlighted the formation of a Bitcoin “death cross,” a technical pattern where a short-term moving average crosses below a long-term moving average. While previous death crosses have sometimes indicated market bottoms, the current context suggests a potential for a “macro lower high.” For Bitcoin to avoid this scenario and challenge the bearish outlook, it would need to respond bullishly within a week of such a formation and convincingly move above its 50-day Moving Average (50DMA), specifically targeting the $110,000 mark. A failure to do so could mean that any subsequent rally towards this $110,000 area would merely serve as a macro lower high, consistent with the forecast for a deeper decline in Q2 2026.

Conclusion

The analyst’s warning regarding Bitcoin’s potential early-2026 rebound preceding a major crash underscores the importance of a comprehensive market perspective. While a short-term bounce might seem encouraging, investors are advised to carefully consider the prevailing macroeconomic conditions, liquidity trends, DXY movements, Federal Reserve policy, and ETF flows. Understanding these interconnected factors is crucial for navigating what could be a volatile period for Bitcoin, distinguishing between a genuine market recovery and a temporary “macro lower high” before a more significant correction.