Bitcoin's brief rally to $66,921 failed at the golden zone, and the price has since fallen back to $63,422, a pattern that appears less like a recovery and more like a textbook bull trap.

Every major indicator on the daily chart is bearish, and Myriad traders are betting on $55,000 before $84,000.

Crypto markets opened the day red, and then got redder.

South Korea's KOSPI index fell more than 8% at the open and triggered a circuit breaker, sending a risk-off shockwave through global markets before New York traders had finished their coffee. Bitcoin's reaction was immediate: a drop to $62,684 in early trading, a brief attempt to recover, and then nothing.

Decrypt's morning snapshot showed BTC at $63,400, down 2.7%, with Ethereum at $1,875, down 4.2%, and Solana at $73, down 4.4%. More than $670 million in crypto liquidations hit the market over the past 24 hours, including $533 million from longs, a result that often follows when too many traders position for a rally that does not materialize.

Oil fell 2%. Gold slipped 1%. Even Nasdaq futures turned red, weighed down by weakness in memory stocks. The only thing that did not move was the Fed, and that is part of the problem.

The Federal Open Market Committee meets today and tomorrow, with Fed Chair Kevin Warsh's decision and press conference due July 29. Markets expect a rate hold at 3.50% to 3.75%, but the memory of Warsh's June press conference, when he pushed rate hike odds to 70% and 2-year Treasury yields jumped 16 basis points, has traders deleveraging rather than holding through the event. Stock futures are split, with Dow futures up 0.7% and Nasdaq futures down 0.9% on memory stock weakness. Oil fell 2%, gold slid 1%, and crypto is absorbing more of the damage than most markets.

Bitcoin price: the bounce was a trap

Bitcoin's brief move toward $66,921 briefly generated optimism. Bulls argued that the 200-day exponential moving average, or EMA, had held. EMAs are averages that track price over a specific period of time, and traders often use them to judge trend direction. On the surface, the market seemed to be stabilizing.

The charts tell a different story.

Between Monday and Tuesday, BTC has erased all the gains from the previous week, canceled the bullish trend, and returned to bear territory, almost as strongly as before the bounce. The current resistance also appears parallel to the previous resistance that marked the decline from May to July. That matters because repeated failures at similar levels tend to keep the market locked in the same trading range, leaving short-term rallies vulnerable to being sold into rather than confirmed as a trend change.

The larger picture is even harder to interpret optimistically. On the daily chart stretching back to September 2025, price has been trading well below both the cloud and the 200-day average for months. The pattern has been consistent: an occasional green week appears, gets sold, and the slide resumes. This week appears to be following the same structure, which is why the recent bounce has done little to change the broader setup.

The three bearish resistance lines — the blue line from November 2025 to April, the white line from May through July, and the one currently forming — are parallel.

What the indicators say

The exponential moving average structure is clearly bearish. EMAs show where price sits relative to average levels over time, and the further price remains below them, the weaker the underlying trend. In this case, the 50 EMA is below the 200 EMA, with price below both. That formation is known as a death cross, and it has been in place for months.

The RSI, or Relative Strength Index, is at 46.5. A reading below 50 suggests a bearish tilt. It is not oversold enough to attract forced bargain hunters, which generally happens below 30, and it is not strong enough to indicate meaningful buying momentum. Neutral to slightly bearish is the fairest description.

The Squeeze Momentum Indicator has been active for nine bars, which suggests pressure is building. But squeezes more often resolve in the direction of the prior trend than reverse it, and the prior trend on this chart is down. Momentum inside the squeeze is reading 0.25v, which shows only a faint bullish lift and does not resemble the setup for a sharp upside release.

What Myriad traders are betting

On Myriad, the prediction market built by Decrypt's parent company Dastan, the question is whether Bitcoin hits $84,000 or $55,000 first. Traders are assigning 65.7% odds to $55,000 and 34.3% to a move higher.

In March, before Warsh's first press conference turned hawkish, the split was nearly the opposite. Traders have been repricing Bitcoin's downside for months, and today's technical picture is not giving them reason to reverse that view.

The bull case still exists, but it is limited. A sharply dovish surprise from the Fed tomorrow, with Warsh signaling patience rather than hikes, could be the kind of external shock that resolves the squeeze to the upside and forces a short squeeze through the $65,302 Fibonacci zone. A revival of the Senate's Clarity Act would also provide regulatory support. But both scenarios depend on events outside the chart to rescue a setup that is, on its own, leaning bearish.

For now, the move to $66,921 looks like what bull traps are supposed to look like: a push into resistance, a failed breakout, a return to prior lows, and a squeeze that may be preparing the next leg. Based on the indicators, that next leg does not appear to be up.

Disclaimer: The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.