Bitcoin briefly tops $85K as rising US yields test bullish market structure

Despite these macroeconomic headwinds, Bitcoin's underlying market structure remains relatively constructive.

A report from K33 Research suggests the cryptocurrency has successfully absorbed a significant derivatives deleveraging event without experiencing the type of sharp decline that often accompanies large-scale liquidations.

Rising US Treasury yields put pressure on Bitcoin

Bitcoin's latest rally has stalled around the $85,400 mark, with buyers unable to generate enough momentum to turn the level into reliable support.

One of the biggest obstacles facing $BTC is the surge in US government bond yields.

The five-year Treasury yield has climbed above 5%, while the benchmark 10-year yield has moved beyond 5.2%, putting both at their highest levels in roughly 19 years.

Higher Treasury yields can create headwinds for cryptocurrencies and other risk-sensitive assets because they increase the returns available from comparatively lower-risk government debt.

As yields rise, investors may become less willing to allocate capital toward more volatile assets.

Bitcoin's inability to break $85,000 therefore comes against an increasingly challenging macroeconomic backdrop.

Investors are also hesitant to build large positions before several important US economic releases that could influence expectations for Federal Reserve monetary policy.