Bitcoin Faces Critical "Death Cross" Test—What the Charts Really Tell Us

Bitcoin (BTC) is at a crucial technical juncture. Currently trading around $87.21K with a +1.49% daily gain, the leading cryptocurrency is just 24 hours away from a significant chart pattern: the “Death Cross.” This rare technical event occurs when the 50-day Simple Moving Average (SMA) crosses below the 200-day SMA—and history suggests it could mark the next major inflection point.

The Megaphone Pattern: A Test of Support

One of the most striking patterns on BTC’s chart is what traders call the megaphone formation—a widening price channel that BTC has respected with notable precision. The latest bounce occurred almost exactly at the lower boundary of this megaphone pattern, presenting a critical decision point.

Here’s what matters: if Bitcoin rebounds strongly from this level, it could signal renewed buying momentum. If it fails and tests the lower boundary again during the incoming death cross, the bearish case strengthens considerably. The stakes are high because BTC is already trading below its 50-week moving average, a defensive position that limits room for error.

Death Cross: Timing the Bottom

The “Death Cross” isn’t just a spooky name—it’s a historical timing tool. Every previous death cross has coincided with potential market bottoms or significant trend reversals. Within the next 24 hours, this pattern will complete as the shorter-term 50-day line drops below the longer-term 200-day line.

Many technical analysts expect this could trigger a relief bounce higher. The megaphone pattern combined with the death cross suggests the market might be setting up for a notable move upward in the immediate term. But bounce or not, traders need to watch whether BTC closes above or below the 50-week moving average on a weekly basis—two consecutive weekly closes below this pink line would signal a full-fledged bear market has likely begun.

Macroeconomic Crosscurrents: M2 vs. Gold

The broader economic backdrop paints a mixed picture. BTC’s decoupling from Global M2 (the money supply metric) has been pronounced for months, mirroring the exact pattern seen at previous cycle tops. This is a bearish signal that deserves attention—though some analysts misinterpret the chart, wrongly suggesting BTC will merely “catch up” to M2 movements.

Conversely, Gold vs BTC tells a different story. Gold has recently made significant gains, and historically BTC tends to follow gold with an 80-day lag. By this metric, Bitcoin should be approaching the point (mid-November timeframe) where it begins to track gold’s upward trajectory—assuming correlation holds this time.

The contradiction is stark: the M2 relationship warns of cycle exhaustion, while the gold relationship hints at continuation. This uncertainty is why many portfolio managers are heavily concentrated in BTC (96%+), using it as a hedge against altcoin volatility.

What Could Actually Happen

Short-term, a significant bounce seems probable—possibly within days. Such a relief rally would lift altcoins sharply alongside BTC. The million-dollar question: Is this bounce a springboard to new all-time highs in late December or early 2026, or merely a bear market relief move within a broader downtrend?

Three scenarios exist with different probabilities. The base case remains new ATHs by year-end or Q1 2026, but a secondary possibility is a shallow bear market (50% correction) followed by another rally in 2026 aligned with business cycle patterns. This carries roughly 15% odds. Each consolidation at a higher price level marginally increases the chance of a true cycle top forming.

The honest truth: patience wins here. Traders holding through uncertainty typically wait for actual euphoria—irrational exuberance and overheated sentiment—before taking profits. Bitcoin hasn’t shown that extreme enthusiasm yet, favoring steady stair-step gains instead. Without that clear blowoff signal, the risk-reward of selling ahead of potential new highs doesn’t justify the downside.

This is a waiting game. The death cross, the megaphone bounce, and the macro crosscurrents will provide data points. But the next major move—whether up to new ATHs or down into a bear market—may still be weeks or months away.