Bitcoin Tests Key Resistance as Momentum Weakens

Bitcoin is currently testing the $87,363 resistance level, with the price at $86,252 on a 5-hour chart showing a bullish bias. Despite this upward momentum, there are signs of weakening strength, as key indicators approach critical levels. The cryptocurrency remains 6.98% above its 200-period simple moving average (SMA) at $80,625 and is supported by the Ichimoku Cloud ranging from $84,864 to $85,417. The SuperTrend indicator is also green at $83,900, suggesting that short-term momentum is intact, for now.

However, the recent high at $87,363 was rejected, and the Relative Strength Index (RSI) at 60.74 is nearing overbought territory. While the latest candle closed bullish, the Moving Average Convergence Divergence (MACD) histogram is shrinking, indicating that momentum may be fading. An ascending triangle pattern is forming but requires a decisive close above the resistance to confirm further upward movement.

Traders are watching key levels for potential moves. Bullish traders eyeing momentum could enter at $86,300, while those waiting for confirmation might target $87,400 after a breakout. Bearish traders looking for a reversal might watch $87,000 for a rejection or $84,800 for a close below the Ichimoku Cloud. The no-trade zone spans $85,400 to $87,000, where indecision is likely.

The biggest risk highlighted is a potential 'bull trap' above $87,363, where a failed breakout could lead to a sharp reversal. The ascending triangle pattern's reliability depends on sustained momentum, which is waning. Analysts caution that rising triangles without strong follow-through often trap late bulls.