Bitcoin sparks ‘bull trap’ warning after BTC price rejects at $76K

Bitcoin bulls failed to break through major resistance at six-week highs as open interest trends triggered warnings of a BTC price reversal.

Bitcoin (BTC) risks turning its rebound into a classic “bull trap” as the price rejects at strong resistance.

Bitcoin faces flat Coinbase spot demand and an open interest divergence as prices rise above $75,000.

This risks ending the rebound due to structural weakness, analysis warns.

Any push higher toward $80,000 will be “challenging.”

New research from onchain analytics platform CryptoQuant released on Tuesday warns that the recent BTC price rebound may collapse.

“The Bitcoin market is currently exposing a critical structural vulnerability as it transitions from a healthy spot-led regime to an overheated rally driven primarily by derivatives,” contributor Easy On Chain wrote in a QuickTake blog post.

Several factors support the theory, including the Coinbase Premium Index — the difference in price between Coinbase’s BTC/USD and Binance’s BTC/USDT pairs. 

Despite BTC/USD hitting six-week highs, the index continues to dip into negative territory, pointing to a lack of US spot demand.

“In this absence of spot-buying support, we are witnessing an extreme decoupling between investor cohorts where smart money is tactically distributing its supply,” Easy On Chain continued.

Fellow CryptoQuant contributor MAC_D agreed, drawing a clear distinction between old and new investors.

“Recent on-chain data shows that OG investors are distributing, while new investors are entering the market, indicating a clear transfer of ownership,” they wrote in a separate Quicktake post.

The core issue, however, is with open interest (OI), which shows the market in a precarious situation.

“On the 1-hour timeframe, a divergence between price and open interest is emerging. While the spot market shows strength, futures traders appear reluctant to take on additional risk,” MAC_D continued. 

As Cointelegraph reported, Bitcoin faces a wall of selling pressure in the mid-$70,000 zone, which coincides with old local lows from April 2025.

Related: $58K BTC price still in play? Five things to know in Bitcoin this week

Data from CoinGlass shows price stalling midway through that ask-liquidity at $76,000 before reversing.

Market participants thus remain level-headed when it comes to a broader market recovery. 

In his latest X analysis, Keith Alan, cofounder of trading resource Material Indicators, referenced various moving average (MA) trend lines and proprietary trading tools to put the odds of a full bull-market comeback in context.

“Bulls are currently attempting to flip resistance at the Q2 2024 Timescape Level, and now psychological resistance at $75k is coming into focus. If bulls can push higher the next targets are at the Q2 2025 Timescape Levels at $78.3k and $82.5k,” he explained.

Trader Mister Crypto, meanwhile, drew comparisons between current price action and that from earlier in 2026, where BTC/USD offered a relief bounce before breaking below support.

$BTC is forming a textbook bear flag here...Don't say I didn't warn you. pic.twitter.com/0FnHj0BVrP

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision. While we strive to provide accurate and timely information, Cointelegraph does not guarantee the accuracy, completeness, or reliability of any information in this article. This article may contain forward-looking statements that are subject to risks and uncertainties. Cointelegraph will not be liable for any loss or damage arising from your reliance on this information.

Source: CoinTelegraph