Analyst: Macro Expansion and Fed Rate Cuts Could Drive Bitcoin to New Highs in 2026

Sykodelic argues Bitcoin’s selloff reflects a mid-cycle reset, with macro shifts and chart signals pointing to new highs.

Bitcoin may have already passed a critical turning point in its current cycle, according to market commentator Sykodelic. In a recent post, the analyst said the OG coin’s recent price action reflects a mid-cycle reset rather than a cycle-ending collapse. 

He added that structural signals and shifting macro conditions point toward new highs for the coin. Interestingly, Sykodelic’s comments follow a cautious cloud that has hung over the crypto markets after Bitcoin’s sharp correction.

Sykodelic Says Market Disbelief Often Peaks Before Bitcoin Reversal

According to Sykodelic, the market has already marked a mid-cycle top and has now formed a mid-cycle bottom. From this point, the market commentator expects Bitcoin to touch new highs within the year. 

Within this setting, he stressed that traders “those waiting for October bottom at $40k” may be left behind if the price reversal comes early.

Image Source: X/Sykodelic

The analyst also pointed to a weekly chart structure that supports this framing. Looking at the chart, the price first sold off hard from cycle highs. Afterwards, it recovered to a higher high before rolling over again.

Usually, such sequences are common during mid-cycle transitions rather than at full-cycle peaks. Sykodelic stressed that BTC’s recent weakness does not reflect a trend breakdown. In fact, he linked the movements to a reset in momentum.

A deceptive breakdown below key support levels played a major role in sentiment damage. Those moves created the appearance of long-term failure, which Sykodelic sees as typical during mid-cycle corrections. Disbelief often peaks at such moments, especially after sharp and persistent declines.

He argues Bitcoin has completed an expanded flat correction. On the chart, structure shows a clear A–B–C pattern. An initial decline was followed by a rally that exceeded prior highs, then a final C-wave flushed the price lower. That last leg tends to convince participants that the trend is over, shortly before reversal.

Timing has shifted slightly due to the depth of the recent sell-off. Even so, Sykodelic still expects new highs within the year if the pattern plays out. Weekly momentum indicators support that view, with RSI resetting toward mid-cycle support rather than slipping into long-term bearish ranges.

BTC May Enter Price Discovery as Macro Data Improves

Macroeconomic conditions also play a significant role in his Bitcoin market permutations. Sykodelic believes a large U.S. economic expansion has begun but remains underpriced by markets. He expects incoming Federal Reserve leadership to cut rates more aggressively than current market pricing suggests. Generally, lower rates often drive risk appetite.

From a market perspective, industrial data already points in that direction. ISM readings and related indexes have begun to turn higher and enter price discovery. Historically, the OG crypto tends to move independently of broader market narratives.

Sykodelic compared Bitcoin’s setup to gold before its major breakout. Gold also endured a deep corrective phase before entering price discovery. He mentioned that Bitcoin now sits at a similar point—near the end of a C-wave. At this point, sentiment collapses just before a sharp reversal.

As per the analyst, downside pain has already been expressed. As a result, upside moves may arrive quickly once conditions shift, leaving little room for hesitation.

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