As Bitcoin price fell below the $60,000 threshold, the market saw a mix of technical indicators and levels, leading to divided forecasts and increased uncertainty.

Mixed Signals Cloud Bitcoin Price Trajectory

According to For Bitcoin maximalist Mark Cullen, Bitcoin’s current price action presents a convoluted technical picture. It suggests the $57.5000 level is likely to be tested, with the key question being whether it will hold.

Cullen believes this will happen, at least initially, before a potential breakout. He also emphasizes the importance of the $59,500 level, stating that if Bitcoin manages to break through, it would be a mighty signal to hold on tight to the asset with a tight stop loss below it.

However, Cullen also warns against the possibility of sweeping liquidity below the $54,500 level, which could pave the way for recent lows in the $40,000 range if that level is breached.

Cryptocurrency analyst Axel Adler also steering to a similar picture, emphasizing that since Bitcoin price is currently below the 200-day basic moving average (SMA), this could lead to a further bearish continuation for BTC. According to Adler’s analysis, the next support level is the 365-day SMA at $50,000.

What do the basics of the BTC blockchain say?

Adding to the technical uncertainty, the intelligence platform Glassnode has reported that Swissblock’s Bitcoin Fundamental Index (BFI) moved from positive to neutral last week.

According to the platform’s co-founders, Yan Alleman and Jan Happel, the change reflects the uncertainty surrounding the Black Monday event and the Consumer Price Index (CPI) bull trap felt on the chain.

The BFI, which consists of two sub-metrics measuring network liquidity and network growth, recently showed a fork. While network liquidity fell into neutral territory, network growth increased, painting a convoluted picture of Bitcoin’s fundamental prospects.

Alleman and Happel note that the decrease in network liquidity, although it concerns a compact period, is not necessarily bear signal in the long term. They explain that increased network liquidity is desirable because it increases Bitcoin’s functionality as a medium of exchange.

However, the raise in network growth is seen as a mighty bullish signal, indicating that more players are interacting with the Bitcoin network on an entity-specific basis. This effectively creates a deeper pool of crypto-native capital that could support the asset’s long-term valuation. The Glassnode co-founders stated:

Given the current narrative of “digital gold” store of value and the increasing ease of gaining exposure to BTC via ETFs, CEX exchanges, etc., the network’s increasing growth is a mighty bullish signal.

At the time of writing, Bitcoin was trading at $58,680, down over 2% in the last 24 hours.

Featured image from DALL-E, chart from TradingView.com