2026 Annual Scenario Planner

Wealth is easy to create—now and throughout history. A company can raise $50 million, list publicly, and quickly be valued at $1 billion. Overnight, its founders are labeled billionaires. Yet no one has actually been paid a billion dollars. That wealth exists on paper, marked to market, not in cash.

Money only appears when wealth is sold. That conversion is where stress enters the system. Bubbles form when large amounts of paper wealth accumulate relative to the available pool of real money. The problem emerges when there is a growing need—or incentive—to convert that wealth into cash.

Conventional market thinking assumes this pressure comes from visible policy actions: tighter monetary conditions, higher interest rates, tax hikes, or the threat of wealth taxation. These are the triggers most investors watch for, and the ones most often blamed when markets begin to unravel.

What is consistently overlooked is that major wealth unwinds are rarely set off by the catalyst everyone is watching. The event that breaks a bubble is usually unexpected, unannounced, and already embedded in market structure before it becomes obvious.

Smart money does not wait for headlines. It listens to the markets themselves. We are now entering the window where that unseen catalyst typically emerges—where leverage, liquidity, and internal stress reveal more than policy statements ever could.

/

We've already pointed out that the currency markets tend to make big, violent trend moves right before there's a change in the risk markets. This has been a positive correlation that we've studied over a career and shows an empirical fact. It does give us an inclination regarding the direction but not near-term timing. So, in that regard, we've got to look at our bellwethers that have treated us kindly since the beginning of the new millennium.

Bitcoin’s market value is routinely misunderstood. The headline market capitalization reflects price multiplied by supply, not the amount of cash invested. The true equity base is far smaller, consisting only of spot ownership—on-chain holdings, ETFs, and long-term investors. Price movement beyond that base is largely driven by leverage through futures, perpetuals, options, and synthetic exposure layered on top of existing coins. When leverage expands, Bitcoin can rise rapidly with little new capital; when it contracts, declines are abrupt and disorderly. This makes Bitcoin less a store of value and more a leverage-sensitive volatility instrument—highly responsive to changes in liquidity, risk appetite, and forced de-risking.

So that's good and fine, understood by smart money, and witnessed already by simple observation of the market action. But the key word here is "when." We've started to see its unravelling with the break to new lows in the first part of 2026. So, the foreshadowing has already started.

The change-of-trend dates shown here were generated independently, without reference to the Annual Scenario Planner (shown above.) When overlaid afterward, the alignment is striking. Despite using different inputs and assumptions, both approaches isolate the same windows where risk appetite peaks, liquidity fractures, or reflex rallies fail. That convergence matters more than the precision of any single date—it tells us these are structural time zones, not opinion-based forecasts.

Near-term Bitcoin trading suggests a temporary low may be in place as of Friday.

The Technical Event Model triggered an undercut low (aka spring board) as price broke to new lows below the December pivot. At the same time, the TEM panic reading (not shown) reached an extreme (red not blue.)

On the intraday chart (left), price completed a clear five-wave decline, confirming the dominant short-term trend had been down and increasing the odds of a counter-trend bounce lasting several days.

A 26%–38% retracement would be typical in this context, with upside resistance expected between $87,000 and $89,000.

Importantly, there are no signs of a major low at this stage based on volatility structure, price behavior, or the broader time sequence outlined above. This remains a tactical rebound, not a structural trend change.

Looking back, Bitcoin peaked on October 6, and that call was made in real time.
At the time, we discussed initiating bearish exposure through BITI near the mid-teens, followed by tactical exits and re-entries as conditions evolved. The current documented position reflects a later re-entry around the low-20s, which is now working as expected.

Importantly, this decline unfolded exactly as outlined: a failure to sustain upside near $100,000, followed by progressively weaker retracements. That level remains a defining reference point.

As a rule traders should use the underlying as their trigger as opposed to the vehicle itself. To be clear, taking signals from Bitcoin futures or the spot price is always better suited than taking signals from the trading vehicle ETF or options.

However, the chart on the Bear ETF does show a big base being built that has a potential head and shoulders bottom. Weakness here down towards $22.50 should be used to accumulate for a short-term trade.

The issue with leveraged ETFs is the interest cost goes against you any long-term profitability unless you get a high rate of change move, so you have to keep your position short-term. We did pull some profits. Got back in in the low 20s in December. We like a current position here.

Any near-term rebound should be viewed as a reflex rally, not a structural recovery. Within that context, additional BITI exposure on strength remains consistent with the broader bearish thesis, provided it is treated as a tactical add—not a change in regime.

Great and many thanks,
Jack F. Cahn, CMT+
MarketMap™ 2026 Scenario Planner
Contrary Thinker™ since 1989

Copyright 1989-2026

All-inclusive analytical method: Astrological and Historical Cycles, Advanced Technical Analysis, Traditional EWT, Volatility modeling, Contrarian sentiment modeling. All empirically tested with technical methods hard coded and tested for validity.

Contrary Thinker
1775 E Palm Canyon Drive, Suite 110- box 176
Palm Springs, CA 92264 USA
760-459-4681

OR

25/1 Poinsettia Court
Mooloolaba, QLD Australia 4557
614-2811-9889

-- Contrary Thinker does not assume the risk of its client's trading futures and offers no warranties expressed or implied. The opinions expressed here are my own and grounded in sources I believe to be reliable but not guaranteed.

-- Client subscribers are responsible for keeping their payment details up to date and cancellations via the payment gate.

-- Pricing is subject to change without notice. My indicators and strategies can be withdrawn for private use without notice at any time. Digital products are not returnable or refundable.

-- Trading futures and options involves the risk of loss. Please consider carefully whether futures or options are appropriate for your financial situation. Use only risk capital when trading futures or options.