Bitcoin's Support at $88,000 to $90,000 Has Significantly Weakened, and Volatility May Be Amplified

Bitcoin’s support level between $88,000 and $90,000 has weakened in recent trading sessions, raising concerns about potential downward pressure. On-chain data indicates growing hesitation among traders, with the market positioned for a retest of key resistance levels. Analysts note that this shift coincides with broader market structure changes and regulatory uncertainty, complicating short-term projections.

The cryptocurrency’s weekly chart shows BTC rising 5% near $97,582, the 50-week Exponential Moving Average (EMA). A break above this level could propel the price toward $100,000. The Relative Strength Index (RSI) on the weekly chart is at 46, suggesting fading bearish momentum and a potential reversal toward neutral territory.

Daily chart data adds further nuance. Bitcoin’s price reached a nearly two-month high of $97,800 on Wednesday after finding support near $90,000 last week. This behavior indicates a possible bottoming process, but the price remains vulnerable to renewed volatility, especially if the 50-week EMA cannot be sustained.

Why Did This Happen?

The weakening support suggests a shift in market positioning. Traders have increased call option buying while stabilizing call selling activity, pushing premiums higher and showing strong near-term demand for upside exposure. However, for longer-term options, the behavior reverses: as the spot price rallied, traders sold upside at higher premiums, signaling uncertainty about maintaining gains beyond shorter timeframes.

This split in positioning reflects a tug-of-war between bullish optimism and bearish caution. Market participants remain split on the sustainability of the current rally. For BTC to maintain its upward trajectory, the RSI must cross the neutral 50 mark on the weekly chart.

How Did Markets React?

Bitcoin’s price dipped below $96,000 on Thursday as the U.S. Senate Banking Committee postponed the discussion of a key market structure bill. The move came after Coinbase CEO Brian Armstrong withdrew support for the latest version of the bill due to multiple issues, including restrictions on stablecoin rewards and DeFi provisions.

The postponement caused immediate market jitters, with Bitcoin dropping 1% in the session. Other major altcoins such as Ethereum, Ripple, and Solana followed suit, with liquidation data showing a bearish bias as long positions were sold off. This reaction underscores how sensitive the market remains to regulatory developments and institutional sentiment.

What Are Analysts Watching Next?

Market analysts and institutional investors are now watching for two key outcomes in the near term. The first is whether Bitcoin can stabilize above the 50-week EMA, which would be a critical step toward retesting the $100,000 level. The second is the resolution of regulatory uncertainty, particularly around the stalled market structure bill. If passed, the bill would clarify oversight and create a more predictable environment for institutional investors according to Bloomberg.

Meanwhile, on-chain activity remains a key focus. The BNB Chain, for example, continues to show signs of growth, with Total Value Locked (TVL) and transaction count rising. This suggests that broader network activity may contribute to token demand, particularly for projects with strong use cases or adoption.

Investors also remain attentive to macroeconomic signals. Kraken noted that the current environment is less influenced by traditional crypto cycles and more shaped by macroeconomic conditions, institutional flows, and regulatory progress. A return of retail attention, currently diverted to AI and equities, could also shift the balance of power in the market.

Bitcoin’s path forward remains complex. The weakening of key support levels, combined with regulatory uncertainty and mixed technical indicators, suggests that volatility is likely to persist. Investors are advised to monitor both on-chain metrics and legislative developments as critical factors shaping the market’s next move.