Bitcoin struggles near $85,000 as $87,000 resistance holds firm

Bitcoin slid closer to $85,000 on Tuesday after another failed attempt to break above $87,000, leaving traders uncertain between a supportive recovery and stubborn resistance. As of October 6, BTC was trading around $85,500 to $85,600, with sellers rejecting the $87,000 mark for the third time since September 23. While weaker US employment data has reduced expectations of a Federal Reserve rate hike, this tailwind has not been enough to push BTC decisively through $87,000.

The 10-year Treasury yield remained around 5.3%, close to levels last seen in 2002, while the dollar stayed firm. This means Bitcoin is still competing with attractive risk-free yields despite easing rate-hike odds. Analyst Alex Kuptsikevich of FxPro noted that Bitcoin is nearing the apex of a triangle formed by horizontal resistance and rising support, suggesting a sharper move once the structure breaks.

Despite repeated failures at $87,000, institutional demand for Bitcoin remains strong. US spot Bitcoin ETFs attracted roughly $2.65 billion in September, with another $134 million arriving in the first two trading sessions of October. However, analysts warn that Bitcoin still needs stronger spot demand and a sustained close above roughly $87,400 to confirm a convincing breakout. Potential upside levels include $90,000 and $93,000 if yields ease further and macro conditions improve.

Traders should be cautious about treating every dip towards $85,000 as a sell signal. The bearish case becomes more convincing only if underlying demand fails to defend the next support zone. Initial support sits near $84,000, with a more important floor around $82,000. A decisive break below $82,000 would weaken the recent bullish structure more seriously. Conversely, a sustained break above $87,000 to $87,400 would reduce bearish pressure and bring $90,000 to $93,000 back into view.