The Fake Bottom: Why I Expect One More Crypto Flush Before the Real Rally

I strongly recommend reading this article all the way to the end; your money is precious, and knowledge is what protects it.

Is This Crypto Bounce Real? Why I Expect One More Leg Down

The entire crypto market just went through a brutal flush: in roughly six weeks, Bitcoin dropped from the $120k–$126k area to the low $80k range, a drawdown of about 30–35%. More than $1 trillion in total crypto market cap evaporated as prices cascaded lower across Bitcoin, Ethereum, and most major altcoins.

Now, we’re seeing what looks like a “relief rally.” Bitcoin has bounced back toward the high $80k–low $90k zone, and on some days more than 80% of the top 100 coins are green at the same time.

So the big question is simple:

Is this the start of a new leg up, or just a classic dead cat bounce before another leg down?

My answer is clear: I do not believe this is the real bottom. Historically, when I look at Bitcoin and the broader crypto market, this pullback feels too short in time and too clean in structure to mark a true cycle low. In my view, at least one more medium-intensity downswing is still ahead before the next powerful uptrend can really take off.

Below is how I see it—and I’ll back this view with both data and my own interpretation of crypto’s history.

1. What Actually Happened in This Crash?

Let’s get the facts straight first.

Bitcoin fell from an all-time high around $120k–$126k to roughly $80k–$82k at the worst point in the recent crash.
That’s roughly a 30–35% drawdown in just over a month.
Total crypto market cap dropped from about $4.2T to under $3T, erasing around $1.2–$1.3T in value.
Open interest in crypto derivatives fell sharply, down roughly 40% from recent peaks, as leveraged positions were flushed out.

Right now, as of late November 2025, Bitcoin has crawled back toward the $90k area, with traders talking about a potential “Santa rally” and funding rates flipping around as positioning resets.

On the surface, that sounds like a healthy reset: leverage washed out, price stabilizing, and a rebound forming.

But when you zoom out and compare this to previous major cycle corrections, something doesn’t feel right—and that is the core of my skepticism.

2. Price vs. Time: Why This Drop Feels Too Short

Everyone loves to talk about percentage drawdown.
But in crypto, time is just as important as price.

Look at past major Bitcoin cycles (approximate numbers):

2017–2018:
- Peak-to-trough: about –84%
- Duration: roughly 1 year
2021–2022:
- Peak-to-trough: about –77%
- Duration: around 18 months
2025 (so far):
- Peak-to-“trough”: about –31%
- Duration: roughly 6 weeks

Does that look like a completed macro correction to you?

To me, it doesn’t. It looks like Round 1 of a larger process.

A real cycle reset in crypto has two ingredients:

Deep price damage (everyone can see that on a chart), and
Extended time damage—months of boredom, frustration, and slow grinding that slowly kills investor optimism.

Right now, we have strong price damage but very little time damage. The market just rushed from euphoria to panic and is already trying to bounce back. That’s emotionally intense, but it doesn’t match the typical cycle pattern where the market needs time to fully digest excesses.

In other words:

This looks more like the first major leg of a new downtrend, not the completion of one.

3. What This Bounce Really Looks Like

When you analyze this bounce, a few things stand out:

3.1. Structural damage is still fresh

This crash wiped out over $1 trillion in market value and triggered huge liquidations across derivatives platforms. Spot Bitcoin ETFs saw large outflows in a short time window, and open interest has been smashed lower.

That’s not the kind of backdrop where you expect a clean “V-shaped” bottom that immediately launches to new highs and never looks back. At this stage, the market is still re-pricing risk and digesting forced selling, not yet entering a new euphoric phase.

3.2. The psychology screams “relief rally”

Right now, the narrative feels very familiar:

“The worst is behind us.”
“This was just a healthy 30% pullback.”
“Leverage got flushed; now we go up.”

We’ve heard that song many times. In previous cycles, those first big bounces after the initial crash were often:

Strong enough to make people believe “bottom is in,”
Short enough that late buyers still remembered the prior all-time high, and
Sharp enough to trap leveraged dip-buyers right before the real capitulation move.

This current bounce fits that pattern disturbingly well.

3.3. Macro still isn’t friendly enough

Crypto boomed on the back of loose liquidity, AI-driven tech euphoria, and aggressive risk-on positioning. That environment has cracked:

Concerns over stretched tech and AI valuations
Mixed signals on interest rate cuts
Rising risk aversion across broader markets

If macro conditions are still wobbling, it’s hard to argue that crypto should immediately return to full-throttle risk-on mode. Instead, the more logical path is choppy, painful sideways-to-down trading before the true next leg higher.

4. My Bold View: One More Medium-Strength Leg Down

Let’s be explicit. In my personal view, here’s the most likely path over the next phase of this cycle:

4.1. Base case (my main scenario)

Bitcoin:
- Current zone: roughly $90k
- Potential bounce extension: $95k–$100k to pull more people back in
- Then: one more leg down into the $70k–$80k range, possibly with panic wicks below that
Major altcoins (ETH, SOL, etc.):
- Likely to underperform BTC on the next drop
- Another 30–50% down from whatever high this relief rally makes would not surprise me
Total market cap:
- Could easily revisit the $2.2T–$2.5T region before a more durable bottom forms

This is what I mean by “one more medium-strength leg down.” I’m not calling for a –80% apocalyptic bear market like 2018, but I am expecting something bigger than a simple one-and-done 30% dip.

Emotionally, this would:

Punish aggressive dip-buyers who treated this bounce as a guaranteed bottom.
Force more weak hands out of the market.
Create a cleaner accumulation zone for long-term capital.

4.2. Bullish alternative (what proves me wrong)

What would make me admit I was too bearish?

Bitcoin regains $100k, holds it as support, and
Total market cap quickly reclaims the $3.5T–$4T zone with improving spot flows and shrinking ETF outflows, not just leverage games.

If that happens, I’d say the recent crash was a violent but contained correction within an ongoing super-cycle, and the true bear risk has been postponed.

4.3. Bearish alternative (worse than I expect)

On the flip side, if macro really deteriorates or a critical player blows up (large exchange, major stablecoin, huge structured product, etc.), we could see:

Bitcoin revisiting $50k–$60k
Altcoins revisiting levels people thought were “gone forever”

I don’t see that as my base case right now, but in crypto, tail risks are always real.

5. How I Think Traders and Investors Should Frame This

Everyone has a different style and timeframe, but if you zoom out from the noise, a few principles stand out in this kind of environment.

5.1. Treat this bounce as suspect, not sacred

When you see:

A 30% crash
Massive liquidations
A quick bounce
No real time for proper accumulation

It’s rational to doubt the first big rebound, not worship it. Whether you’re a futures trader or a spot investor, assuming “the bottom is in” after only six chaotic weeks is, in my view, irresponsible.

5.2. Respect the possibility of a second flush

If I’m right and we see another medium-strength leg down:

You’ll want dry powder, not full exposure at current levels.
You’ll be happy you didn’t marry altcoins that can easily drop another 40–60%.
You’ll see more interesting long-term entries once the market has truly exhausted the remaining hope.

5.3. Separate price noise from structural reality

Even if we get another leg down, that doesn’t mean crypto is dead:

Institutional adoption, infrastructure, and regulation have all advanced far beyond earlier cycles.
Bitcoin is much more integrated into the global financial system now.
Major players (corporates, funds, ETFs) now treat BTC as a strategic asset—even if they’re currently reducing exposure.

But market structure and long-term narrative can be bullish while price still has room to fall in the short-to-medium term. Those two truths can coexist.

6. Final Thoughts

This recent bounce feels good emotionally—especially after a crash that erased over a trillion dollars of crypto wealth in such a short time. But emotionally comforting moves are often the most dangerous ones.

When I compare the depth and duration of past cycle corrections with what we’ve just seen, I cannot treat this as a completed reset. In my view, one more medium-strength downside wave is still the most probable path before the market can build a truly solid foundation for the next big rally.

If I’m wrong, the market will prove it by sustainably reclaiming higher levels and holding them. Until then, my stance is simple:

Enjoy the bounce, but don’t confuse relief with resolution.

This article is for informational and educational purposes only and does not constitute financial or investment advice; any decisions you make with your money are entirely your own responsibility.

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