Bitcoin (BTC) is rapidly approaching the $100,000 mark, buoyed by optimism surrounding a potential major trade deal teased by U.S. President Donald Trump, with speculation pointing to the U.K. as the deal’s likely counterpart.
This surge in prices aligns with the broader bullish trend in cryptocurrencies and positive sentiment in traditional markets, as evidenced by higher Asian stocks and S&P 500 futures climbing 0.6%. However, despite this upward momentum, several factors suggest the path to $100K might face some obstacles.
Wall Street Journal’s Cautious Outlook
One key factor is a report from the Wall Street Journal, which dampens optimism surrounding Trump’s trade deal. According to the report, the major announcement Trump hinted at on Truth Social might just outline a “framework” for tariff adjustments, rather than a full trade deal. This implies that the actual agreement could take weeks or even months to materialize, which could cause the current bullish momentum in BTC to slow as initial excitement fades.
Resistance at $99,900
As previously discussed, the $99,900 price level could present a significant resistance point for Bitcoin. There may be increased selling pressure from traders who purchased Bitcoin around these levels earlier this year, along with potential profit-taking from long-term holders looking to cash out. This could hinder Bitcoin’s progress toward breaking the $100K threshold.
Coinbase Premium Indicator Shows Weakening Demand
The Coinbase premium, a popular indicator of demand from U.S. investors, has also shown signs of weakness. This metric tracks the difference between Bitcoin’s price in USD on Coinbase and in USDT on Binance, and in previous bull runs, a sustained increase in this premium typically signaled strong demand from U.S. buyers. However, since late April, the seven-day moving average of the Coinbase premium has shown a bearish divergence, suggesting that demand from U.S. investors may not be as strong as it was in earlier phases of the rally.
Bearish RSI Divergence Signals Potential Weakening Momentum
Finally, despite Bitcoin setting a new multi-week high during the Asian session, the relative strength index (RSI) for the 14-hour period failed to follow suit, creating a bearish divergence. This suggests that while price action is still climbing, momentum may be losing steam, signaling a possible weakening of the rally.
Given these factors, while Bitcoin’s ascent to $100,000 remains a possibility, the road ahead could be rocky with increased resistance and signs of waning bullish momentum.
