Bitcoin Climbs To 87K As Analysts Warn Of Possible Dead Cat Bounce

TLDR

Table of Contents

Bitcoin climbed 1.8% in 24 hours, reaching $89K before settling at $87,755.
Analysts say $98K is a key level; a close below may trigger more downside.
A head-and-shoulders pattern on the monthly chart suggests trend weakness.
Bitcoin is reacting near the Ichimoku Kumo cloud, echoing 2022 patterns.

Bitcoin has rebounded by over 1.8% in the past 24 hours, briefly reaching $89,000 before settling around $87,755. While this uptick has brought short-term relief to investors, several analysts warn it could be a classic dead cat bounce—an early recovery in a broader downtrend. With key resistance levels approaching, especially at $98,000, the next few moves will be critical in determining Bitcoin’s near-term market direction.

Short-Term Recovery Fails to Convince Analysts

Bitcoin saw a moderate recovery, gaining 1.8% in 24 hours and reaching a peak of $89,000 before pulling back to $87,755. This movement followed a weekend dip to $82,000, which prompted many investors to hope for a turnaround. However, multiple analysts remain cautious, warning that the current price rise may not indicate a lasting uptrend.

Technical analyst Elja explained that short-term rallies often occur during downtrends. He pointed to $98,000 as a crucial level that previously served as support. “After a major drop, you often see a quick relief rally, like a ‘dead cat bounce,’” he said. Elja warned that failure to close above this level on the weekly chart could confirm a bearish setup and potentially lead to a decline toward $75,000.

Bearish Structures Appear in Technical Patterns

Market observers have flagged various indicators that suggest downward pressure may continue. Ted Pillows described the recent move as a “relief bounce,” saying that while optimism may return briefly, the broader structure remains weak. He emphasized that short recoveries often fade without sustained buying.

Another analyst, Titan of Crypto, noted that Bitcoin is reacting near the Senkou Span B—the lower boundary of the Ichimoku Kumo cloud. This level often marks areas of support or resistance in trend analysis. According to Titan, unless Bitcoin reclaims the full cloud zone and holds above it, the price action could mirror 2022’s failed rallies.

A head-and-shoulders pattern on the monthly chart has also been identified. This chart formation is typically viewed as a bearish reversal signal. If the neckline breaks, further downward movement could occur.

Disagreement Over Long-Term Outlook

While several technical indicators point to a weakening trend, not all analysts agree on the bearish outlook. Peter Anthony, another market analyst, expressed confidence in Bitcoin’s strength. He believes the market is underestimating the potential for a recovery.

“The dead cat bounce will be fake and many will then FOMO when BTC hits $115,000+,” said Anthony. He added that many traders who sold during last week’s decline may be forced to buy back at higher levels.

Some analysts from BeInCrypto also indicated that several signs suggest a market bottom may be forming. However, they also noted that confirmation of a new uptrend would require Bitcoin to break and hold above the $100,000 mark.

Key Resistance Levels and Upcoming Weeks

The $98,000 mark has become a key resistance level that analysts are closely watching. Closing above this level could signal renewed strength, while rejection may increase downside risks. Bitcoin would also need to clear the upper boundary of the Ichimoku Kumo cloud to shift sentiment.

Until then, the current price movement remains under scrutiny. The next few weekly closes will be critical in determining whether the bounce is the start of a broader move higher or just another pause in an ongoing downtrend.