Bitcoin (BTC) fell below the $7,000 mark on Wednesday, neutralizing the immediate bullish outlook. More worryingly for the bulls, a further decline towards $6,425 (recent low) would turn the tide in favor of the bears, the technical charts indicate.

The cryptocurrency witnessed a head-and-shoulders breakdown at 09:00 UTC yesterday and fell to $7,000 (target as per the measured height method). The hourly momentum studies (moving averages) were aligned for a bullish move back then, hence BTC was expected to defend the psychological mark.

However, the sell-off gathered pace early in the U.S. session, pushing BTC down to a low of $6,670, according to Bitfinex data. Interestingly, the drop in BTC coincided with a 500 point sell-off in S&P 500 futures.

Since late February, bitcoin and U.S. stocks have been moving more or less in tandem, indicating the cryptocurrency is still being perceived as a risk asset. By the day’s end, U.S. stocks had turned positive, yet bitcoin fell further to $6,565 in the Asian hours before regaining some poise.

As of writing, BTC is changing hands at $6,847 on Bitfinex. While the retreat from $7,510 (April 3 high) to $6,565 has neutralized the immediate bullish outlook, a close today (as per UTC) above the 10-day moving average would boost the odds of an upside break of the falling channel (seen chart below). Read more from…

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