Top Three Factors Pushing Bitcoin Towards Falling Below $90K
Bitcoin is currently facing some challenges that could potentially drive its price below $90,000. Despite hopes for a breakthrough above $100,000, prices recently dropped to $94,500 as key indicators suggest further declines may be on the horizon.
One reason for concern is the 25-delta risk reversal, which compares the volatility premium of options betting on price increases to those protecting against price decreases. Currently, the negative risk reversal indicates a preference for protective puts, signaling a cautious stance among traders.
In addition, the Coinbase premium, which measures the price difference between BTC on Nasdaq-listed Coinbase and offshore exchanges like Binance, has decreased. This shift suggests weakening demand for BTC in the U.S., adding to the downward pressure on prices.
Another red flag is the relative strength index (RSI) divergence, where the RSI fails to confirm price movements. Despite reaching a high above $99,000, the RSI did not follow suit, hinting at a possible loss of bullish momentum and the potential for future price drops.
While intraday charts show support in the $87,000 to $88,000 range, indicating a possible floor for a deeper decline, long-term technical studies still lean towards a bullish outlook. It’s essential for investors to monitor these indicators closely to make informed decisions about their Bitcoin investments.
