Where will Bitcoin pull back to? The MVRV model accurately predicts support levels

The MVRV indicator has always been regarded as an important reference for Bitcoin's medium to long-term valuation, and in this cycle, its 'extreme deviation pricing range' has once again demonstrated its high reference value. By observing the evolution of multiple phased trends, we can clearly see that this model remains reliable at key points.

In the first wave of the rising market in March 2024, the BTC price broke through the purple extreme line (marked 1), and subsequently, the price trend adjusted downward step by step, crossing through the red, orange, and yellow ranges (as detailed by the red arrows in the diagram). In the second wave of the market in December of the same year, although it did not touch the purple line, after breaking through the red line (marked 2), BTC also began to fall back layer by layer, sequentially crossing the red, orange, yellow, and green lines.

The logic behind this phenomenon is that the average cost for holders gradually increases, and under limited funds, the extent to which the market can push up naturally weakens. The first wave reached the purple line, the second wave only to the red line, and inferring from this, the third wave's peak is likely only able to reach the orange line.

The fact confirms the speculation: on May 22, the peak of Bitcoin just crossed the orange line (marked 3), further validating the accuracy of this model.

Currently, the market is in a pullback phase, and the key support line below that needs the most attention is the yellow line, which is $100,800. This price is not only the current primary defense line but also the lower boundary of area A from the chip structure perspective. If this level can hold steady, BTC has the chance to challenge the orange line again, which is $112,000.

If it falls below $100,800, according to the URPD chip distribution, the next strong support will be in the $93,000-$98,000 range. It is especially worth noting the $96,000 level, which is the average cost for short-term holders and serves as the 'lifeline' of market sentiment.

Following the previous pattern of 'step-by-step pullbacks', if the adjustments continue to deepen, BTC may gradually probe down to the support structure of the yellow-green-blue lines. The green line is currently around $89,000, while the blue line is around $78,000.

In summary, the key observation points for Bitcoin's current trend are concentrated in two places: $100,800 and $96,000. These two price lines will determine in the coming weeks whether the market will rise again or seek further lows.