Several technical and macro-financial signals are currently pointing toward a plausible scenario of a tactical year-end rebound in Bitcoin, though this does not necessarily confirm a structural bullish reversal. Read Vincent Ganne’s technical analysis.
Technical and fundamental signals pointing to a dead cat bounce
Several technical and macro-financial signals are currently converging toward a plausible scenario of a tactical year-end rebound in the Bitcoin price, without necessarily confirming a structural bullish reversal. This scenario is more akin to a dead cat bounce, that is, a temporary rebound within a more fragile dynamic that could be the so-called “cyclical bear market.”
The first factor comes from technical analysis, specifically the Bressert DSS on a weekly basis. Historically, this cyclical oscillator has demonstrated a strong ability to identify phases of excess, both on the upside and the downside. Currently, the DSS is trading in a deeply oversold zone, at levels comparable to those observed during previous intermediate lows.
In the past, this type of setup has often preceded significant technical rebounds—sometimes sharp—but rarely sustained ones when the macroeconomic and structural environment remained weak. In other words, the signal points to a technical rebound, without guaranteeing a resumption of the underlying uptrend, at least not until the bear market has run its course.
The second factor concerns overall dollar liquidity, and more specifically U.S. net liquidity. The combination of the Fed’s so-called “technical” QE, intended for reserve management, and a Treasury General Account (TGA) in a phase of decline could temporarily support this liquidity.
Even in the absence of traditional QE, halting the marginal deterioration of liquidity is often a sufficient catalyst to boost high-beta assets, such as Bitcoin. Historically, Bitcoin reacts less to the absolute level of liquidity than to its change in direction. A shift from negative to neutral, or even slightly positive, momentum may therefore be enough to trigger a recovery in the Bitcoin price.
What kind of rebound is possible if the market repeats the previous bear market (that of 2022)?
Finally, a third analytical perspective is based on a fractal and behavioral analysis, comparing the current structure to that of the previous bear market. On several occasions, Bitcoin has experienced sharp rebounds following a deep correction phase, before resuming a more bearish or sideways trajectory.
The chart below presents a hypothetical price action scenario for the coming weeks by applying the structure of the dead cat bounce from the 2022 bear market to our current price action. Note that there is still a possibility that the Bitcoin price will first test the $70,000–$80,000 range before entering a dead cat bounce phase.
In summary, the convergence of the Bressert DSS signal, a slight improvement in U.S. liquidity, and a pattern of past cycle repetition reinforces the hypothesis of a year-end technical rebound for Bitcoin.
However, this scenario remains fragile, dependent on technical factors and capital flows, and should not be confused with the start of a new, sustainable bull cycle.
Caution is therefore still warranted: a dead cat bounce is, by nature, appealing… but rarely sustainable, and it will occur when no one is expecting it.
