Bitcoin faces “cloud resistance” for $85,000, neutralizing Bulls' risk rewards

In the market, ensuring the best entry point is often half the battle, as timing and level have a big impact on success by distorting the risk-to-reward ratio in court by traders.

While the recent outlook for Bitcoin (BTC) may seem constructive due to the increased demand for bullish bets in the options market, the proximity of cryptocurrency to key resistance that has been upside down in recent months means the risk reward profile of those trying to capitalize bullish outlook.

Since Saturday, the BTC has been pushed onto the lower boundary of West Kaiun at around $85,000. Developed by Japanese journalists in the 1960s, this Hegishi Cloud is a technical analytical indicator that provides a comprehensive view of market momentum, support and resistance levels.

The indicator consists of five rows. Reading Span A, Reading Span B, Conversion Line or Tenkan-Sen (T), Baseline or Kijun-Sen (k), and A Lagging Laging Price Line.

The difference between the main spans A and B forms a sided cloud, whose upper and lower limits serve as potential support and resistance levels based on their price position relative to the cloud. If prices exceed the cloud, it shows a bullish trend, while the prices below suggest a bearish trend.

In early February, BTC fell below $10,000 and traded under West Kaiun. Since then, the lower limit of the cloud has acted as a strong resistance and supply zone, limiting the recovery rallies.

With BTC approaching this level again, the Bulls, especially those who want to go to the market with new bids, may want to be cautious as cloud resistance is around $85,000 and support is below $75,000, so immediate resistance could fall below $75,000. The situation corresponds to Long's unfavourable risk.

One of the denials in the cloud on April 2 resulted in significant sales, bringing BTC below $75,000, reflecting a similar pattern following the denial on February 21.

Thus, the latest interaction with cloud resistance requires close monitoring of potential returns in sales pressure. A recession from this level of resistance will bring attention back to the $75,000 mark.

On the contrary, potential moves above $90K marking breakouts over the clouds would mark a resumption of a wider bull run and a rally to score highs.