The cryptocurrency clocked a high of $7,509 at 19:00 UTC yesterday, according to Bitfinex data, before retreating to $7,070 at time of writing.
While that’s not good news for the bulls, only a clear break below $7,000 would kill the odds of a move higher to $7,800-$8,000, the technical charts indicate.
The pullback has neutralized the immediate bullish outlook. Furthermore, the cryptocurrency has created a minor, bearish head-and-shoulders pattern, as seen in the chart below.
However, motion studies are still biased from the bulls: when the 50-hour running average (MA) and 100 hours are climbing MA, 200 hours MM. Bearish bias (flatlined) has been driven. So now, it might seem to drift down to $ 7,000 or below?
That said, the odds of a corrective rally to $7,800 (channel resistance) and $8,000 (psychological mark) would drop sharply if BTC closes (as per UTC) below $7,000.
Bitcoin closes below $7,000 today, it would add credence to the downward sloping (bearish biased) 10-day MA and signal failure to hold above $7,240. Further, the 5-day MA would adopt a bearish bias, derailing the bottoming out process.
Hence, BTC needs to defend $7,000 to avoid further losses.