I think I've heard a Hadith, that goes something like this, 40 flags (or 120) will fly against the Muslims and the war will be fought on horses and swords, it will the bloodiest battle... Could you please verify this Hadith for me whether it is true or not? I don't know who narrated it or when.

Praise be to Allah, the Lord of the World; and blessings and peace be upon our Prophet Muhammad and upon all his Family and Companions.

Probably, dear brother, you mean the Hadith narrated in Sahih Bukhari from Awf Bin Malik who said that "I went to the Prophet during the Ghazwa of Tabuk while he was sitting in a leather tent. He said, "Count six signs that indicate the approach of the Hour: my death, the conquest of Jerusalem, a plague that will afflict you (and kill you in great numbers) as the plague that afflicts sheep, the increase of wealth to such an extent that even if one is given one hundred Dinars, he will not be satisfied; then an affliction which no Arab house will escape, and then a truce between you and Bani Al-Asfar (i.e. the Byzantines) who will betray you and attack you under eighty objectives. Under each objective will be twelve thousand soldiers".
The same Hadith is narrated in Abu Dawood with some different words. The Prophet said: "You will make peace with the People of Rome and then you and they together will combat an enemy. You will be victorious in that battle. After that all of you will stay at a pasture, at that time a person from among the People of the cross will raise a cross then a Muslim will get angry and rise to him and push him away. Thereafter all the People of Rome get together and attack you under eighty flags…" [Abu Dawood]
Imam Muslim narrates from Abu Hurairah reporting Allah's Messenger (may peace be upon him) as saying: The Last Hour would not come until the Romans would land at al-A'maq or in Dabiq. An army consisting of the best (soldiers) of the people of the earth at that time will come from Madinah (to counteract them). When they will arrange themselves in ranks, the Romans would say: Do not stand between us and those (Muslims) who took prisoners from amongst us. Let us fight with them; and the Muslims would say: Nay, by Allah, we would never get aside from you and from our brethren that you may fight them. They will then fight and a third (part) of the army would run away, whom Allah will never forgive. A third (part of the army), which would be constituted of excellent martyrs in Allah's eye, would be killed and the third who would never be put to trial would win and they would be conquerors of Constantinople. And as they would be busy in distributing the spoils of war (amongst themselves) after hanging their swords by the olive trees, the Satan would cry: The Dajjal has taken your place among your family. They would then come out, but it would be of no avail. And when they would come to Syria, he would come out while they would be still preparing themselves for battle drawing up the ranks. Certainly, the time of prayer shall come and then Jesus (peace be upon him) son of Mary would descend and would lead them in prayer. When the enemy of Allah would see him, he would (disappear) just as the salt dissolves itself in water and if he (Jesus) were not to confront him at all, even then it would dissolve completely, but Allah would kill him by his hand (Jesus) and he would show them his blood on his lance (the lance of Jesus Christ)". [Reported by Imam Muslim]
Imam Ibn al-Muneer said: 'Till this time the incident of gathering and attacking Rome in this huge number of soldiers has not happened yet. This matter has not taken place yet. In this Hadith there are glad tidings and warning at the same time to the Muslims. This Hadith also proves that the result will be in favor of the Muslims and the Muslim army will be much greater than it is now". The Ahadith mentioned above are all correct.
Allah knows best.