Bitcoin Price Analysis

The price of Bitcoin is hovering precariously around key support levels after Monday’s market freefall, during which major cryptocurrencies experienced double-digit drops, followed by a slight recovery on Tuesday.

According to CryptoQuant analysts, Bitcoin’s prices are again at crucial support levels, with risks that this correction may extend further based on valuation metrics.

The Tuesday CryptoQuant market report highlighted that the Market Value to Realized Value (MVRV) ratio has fallen below its 365-day moving average. Historically, this condition has signaled further price declines. Similar breaches have occurred during key downturns, including the COVID-19 crash in March 2020 and the 2021 bear market onset in November.

Analysts recommend investors monitor these valuation metrics to gauge potential price rebounds or further corrections.

Current Market Status

The report notes that Bitcoin’s price is now below the trader’s realized price lower band, which has previously indicated support during the current bull market.

Should this support fail, the price could dip to around $40,000, marking the trader realized price minimum band. At the time of publication, Bitcoin was trading around $56,380, showing a 1.7% decrease over the past day, while the GM 30 Index, which includes the top 30 cryptocurrencies, rose by 2.41% to 108.28 during the same period.