Bitcoin is currently trading just under the significant $90,000 mark, facing challenges in regaining bullish momentum after several weeks of uncertainty. Market sentiment has shifted slightly from extreme fear to cautious monitoring, yet confidence remains delicate. Analysts are divided on the potential future direction. Some caution that a failure to surpass $90K might prolong the existing downtrend, while others argue that a breakout above this threshold could lead to a substantial upward movement.
Adding to the ambiguity, data from CryptoQuant indicates that Bitcoin is undergoing its seventh instance of Realized Volatility compression on the daily timeframe during this cycle. These phases of low volatility frequently precede notable price shifts. The Garman-Klass Realized Volatility metric, which evaluates intraday volatility, is currently signaling an alert that suggests Bitcoin might be on the brink of a significant breakout — in either direction.
Historically, four out of the last six volatility compressions in this cycle have resulted in upward price shifts, while two have led to declines. As Bitcoin remains near a crucial resistance point, this volatility squeeze is likely to serve as a pressure valve — setting the stage for its next major movement. Traders are now closely observing for confirmation.
Bitcoin Momentum Stalls As Volatility Signals Caution
Bitcoin is maintaining its position above the $85,000 level, demonstrating resilience after a period of volatility. Nevertheless, the upward momentum has started to wane, and the price has struggled to climb higher despite repeated attempts. Bulls face challenges in reclaiming the $90,000 level, while bears are increasingly probing the strength of the $85K support zone. A decisive break below this level could confirm a deeper retracement and pave the way for further declines.
Analysts remain split regarding the next steps. Some warn that if Bitcoin doesn’t reclaim $90K soon, the market could enter a prolonged correction phase. Conversely, others express optimism, highlighting the potential for a breakout should bulls manage to regain control and convert resistance into support.
Furthermore, prominent analyst Axel Adler shared a vital on-chain insight on X, noting that Bitcoin is currently experiencing its seventh Realized Volatility compression on the daily timeframe within this cycle. The Garman-Klass Realized Volatility metric, which monitors intraday price fluctuations, is showing an alert — indicating that a notable move may soon occur.
Historically, these periods of volatility compression have often preceded significant price shifts. In four out of six previous instances, Bitcoin experienced sharp rallies following such compressions, while in the remaining two cases, prices declined. With Bitcoin hovering near a critical level, this volatility squeeze could potentially act as a catalyst for its next big movement — up or down. As pressure builds, traders are eagerly watching for confirmation signals that will indicate the market’s true direction.
Price Action Details: Key Levels To Watch
Bitcoin is presently trading at $87,000 after a few days of fluctuations between $84,000 and $88,000. The price action has shown relative stability, but bulls are running out of time to regain control. To confirm the initiation of a new uptrend, BTC must decisively break above the $90,000 mark — a significant psychological and technical resistance area.
Currently, both the 4-hour 200-day moving average (MA) and the exponential moving average (EMA) are serving as short-term support, helping Bitcoin remain above the $86K-$87K zone. These levels are crucial for maintaining momentum and preventing a breakdown in market structure.
However, if bulls are unable to uphold this support and fall below the $85K zone, bearish pressure may escalate. A drop beneath $84K would invalidate the current range and likely drive BTC down to retest the $81,000 mark — a critical area of previous demand.
As the price continues to coil within a narrow band, the forthcoming breakout — or breakdown — will likely set the tone for the upcoming weeks. Until then, bulls must act swiftly to reclaim $90K and shift sentiment back in their favor before the market shifts against them.
Featured image from Dall-E, chart from TradingView
