Markets may be heading into a far more turbulent phase than investors currently expect, according to a fresh macro outlook from Bloomberg Intelligence strategist Mike McGlone.
His analysis paints a 2026 scenario defined by tightening financial conditions, falling risk assets, and renewed strength in hard commodities – a setup that echoes some of the most uncomfortable periods in U.S. economic history.
Key Takeaways
The outlook suggests rising downside risks for equities, Bitcoin, and cyclical commodities into 2026.
Falling bond yields and strengthening precious metals point to a potential shift toward safety.
Suppressed volatility may be masking deeper structural stress across markets.
Rather than focusing on short-term market noise, McGlone’s framework looks at how prolonged policy tightening, suppressed volatility, and stretched asset valuations could unwind over the next year.
A risk-off scenario takes shape
One of the most striking elements of the outlook is the expectation that U.S. equities may struggle for a third consecutive year. The S&P 500, which has already endured elevated volatility since 2024, could remain under pressure if growth slows and financial conditions tighten further. McGlone points to volatility levels that remain unusually low by historical standards, warning that calm markets have rarely been sustainable for long.
At the same time, several key commodities are projected to move sharply lower in a slowdown scenario. Crude oil could slide toward $40 per barrel, while copper – often viewed as a barometer of global growth – may retreat toward the $4 level. Agricultural markets may not be spared either, with corn prices potentially drifting toward $3.50 as demand weakens.
Bond markets, however, tell a different story. Long-term Treasury yields could fall below 4% if recession risks intensify, reflecting a renewed flight to safety and softer inflation pressures.
Bitcoin and metals: diverging paths
Digital assets are also central to the outlook. Bitcoin is projected to trend lower toward the $50,000 region if risk appetite fades and liquidity tightens. McGlone suggests that a sustained move below key psychological levels would reinforce the broader risk-off narrative forming across markets.
In contrast, precious metals are positioned as potential beneficiaries. Silver, in particular, stands out as a candidate for multi-year highs, with gold also seen as a possible winner if investors seek protection from equity volatility and policy uncertainty. Historically, periods of falling yields and rising macro stress have favored hard assets, and McGlone argues current conditions are beginning to align with that pattern.
What would prove this view wrong
The strategist also outlines clear markers that would invalidate the bearish thesis. A Bitcoin price that holds comfortably above $100,000 would signal ongoing risk appetite. Copper staying north of $6 would suggest global growth remains resilient, while Treasury yields above 5% could indicate inflation and policy pressures are far from easing. Persistent calm in equity volatility would further challenge the idea that markets are on the verge of a broader reset.
Why timing matters
A key concern highlighted in the analysis is timing. Consensus expectations, McGlone argues, may be running too hot heading into political and economic crossroads, increasing the risk of sticky inflation and policy missteps. He also notes that several major markets have already shown signs of peaking at different points in 2025, hinting that momentum may be fading beneath the surface.
Perhaps most notably, gold and silver have rarely rallied at such speed while equity volatility, inflation, and energy prices remain subdued – a historical anomaly that often precedes broader market adjustments.
If McGlone’s scenario plays out, the next phase for global markets may be less about chasing returns and more about navigating volatility that investors have grown unaccustomed to confronting.
