Bitcoin attempts recovery after dipping below $90k: check forecast

The cryptocurrency market has stabilised over the past few hours, following a sharp correction earlier this week.

Bitcoin rallied above $93k a few hours ago but has now slightly declined towards the $91k region. 

The leading cryptocurrency is still supporting the $90k key support level.

Failure to defend this level could see Bitcoin suffer further losses in the near term. 

Analysts predict further dump

While Bitcoin has defended the $90k support level this week, analysts are not optimistic of a short-term bounce.

In an email to Invezz, Dr Sean Dawson, head of research at the on-chain options platform Derive.xyz, pointed out that the market is experiencing a volatility surge across the board. 

Short-term volatility (30-day tenor) has jumped from 41% to 49% in just two weeks, and long-term volatility (180-day tenor) has moved almost in lockstep, rising from 46% to 49%.

Dawson added that BTC skew has also taken a meaningful hit. Skew is one of the clearest measures of sentiment because it captures the relative pricing of puts versus calls – downside protection versus upside leverage.

The 30-day put skew has fallen from -2.9% to -5.3%, suggesting that traders are increasingly paying up for downside insurance as prices continue to soften.

Dawson concluded that Bitcoin’s price continues to lean bearish.

Options markets are assigning only a 30% probability that BTC finishes 2025 above $100K, while there’s now a 50% chance we close the year below $90K. 

Bitcoin finds support around the $90k psychological level

The BTC/USD daily chart is bearish and inefficient as Bitcoin has underperformed over the past few days.

BTC began the new week bearish, extending its decline by 2% and closing the weekly candle below the 61.8% Fibonacci retracement level at $94,253.

The leading cryptocurrency dipped to the $89k region on Tuesday but quickly bounced from the key psychological $90,000 level, ultimately closing the day higher at $92,960.

At press time, BTC is now trading around $91,600 per coin. 

If the $90k support level continues to hold, Bitcoin could extend its recovery towards the support-turned-resistance level of $94,253. 

The Relative Strength Index (RSI) on the daily chart is 29, close to the oversold region, suggesting that the bearish momentum remains strong.

The MACD lines also remain within the bearish zone, indicating that sellers remain in control.

If the daily candle closes below the $90k psychological level, Bitcoin could extend its correction towards the next daily support level at $85k.