Key takeaways:
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Bitcoin’s drop below its MVRV Mean band puts $75,700 as the next major downside target.
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BTC whales are accelerating their purchases as Wall Street analysts predict a 40% price rebound by year-end.
Bitcoin (BTC) may be preparing for a deeper decline after breaking below a crucial long-term support level that has helped stabilize its price since 2023.
Bitcoin price could plunge to $75,700
The BTC support stemmed from the MVRV Extreme Deviation Bands, a set of lines that indicate when Bitcoin is overvalued or undervalued compared to what most holders paid for their coins.
The most important line is the Mean band (yellow), which acted like Bitcoin’s “fair value.” When BTC traded above it, the market was usually healthy. When it fell below it, weakness often followed.
Last week, Bitcoin slipped under the Mean band for the first time since late 2022.
In previous cycles, once BTC lost this “fair value” line, the price usually drifted down toward the –0.5σ (teal) band.
As of Tuesday, the teal band aligned with the $75,700 level, down approximately 18% from current prices and now serving as the next downside target for Bitcoin.
A breakdown below the teal band could accelerate the sell-off toward the -1σ band (blue) at around $52,800, akin to the bear markets in 2022, 2021, and 2018.
The bearish outlook emerged as Bitcoin retreated 30% from its record high of around $126,300, erasing its year-to-date gains entirely and pushing its ETF investors into losses for the first time in history.
Related: Crypto carnage — Is Bitcoin’s 4-year cycle over? Trade Secrets
Bitcoin could rebound by 40% before 2025 ends
Onchain data showed that Bitcoin whales have accumulated BTC over the past month, highlighting their conviction in an eventual recovery.
That prompted some analysts, including Matt Hougan, the chief investment officer at Bitwise Asset Management, to suggest that a Bitcoin bottom is near.
“I look at this as a great buying opportunity for long-term investors,” Hougan said.
BitMine chairman Tom Lee predicted Bitcoin would hit a record high by year’s end, meaning at least a 40% rebound from current price levels.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
