Bitcoin Hits $104K But Faces Pullback Risk Amid Overbought Signals

Bitcoin’s breakout above the critical $100,000 level marked a major psychological milestone for the market, peaking near $104,000 after cleanly breaching the $98,000 resistance. However, despite the bullish excitement, analysts urge caution, suggesting this surge may be a short-term overextension rather than the beginning of a sustained rally.

Historically, Bitcoin price spikes of this magnitude are often followed by consolidation or even sharp corrections. Current technical indicators support this pattern. Notably, trading volume is not keeping pace with the price surge—typically a red flag when evaluating the strength of a rally. Ideally, volume should be rising in tandem with price to confirm bullish momentum.

Additionally, the Relative Strength Index (RSI) is firmly in overbought territory, sitting well above the typical reversal point of 75. This signals a potential near-term top and increases the risk of a retracement.

Key support levels now lie between $98,000 and $95,000. A failure to hold this zone could trigger a sharp drop toward $92,000 or even $90,000. The 50-day exponential moving average (EMA), currently hovering around $93,000, is also a critical level bulls must defend to prevent further downside pressure.

While the path to higher highs remains intact in the long term, a healthy consolidation phase appears necessary before Bitcoin can confidently push further above the $100K mark. For now, market participants should monitor volume, RSI, and key support zones closely as volatility remains elevated.