Crypto Analyst Says Next Bitcoin Target Is $78,700 If BTC Breaks This Resistance
The analyst explained that the next target for Bitcoin would be $78,700 if BTC could cross this resistance level of the on-chain price model.
Bitcoin MVRV Extreme Deviation Pricing Bands Place Resistance at $65,800
In a new post on X, analyst Ali discussed Bitcoin price levels that may be important based on the on-chain pricing model. The model is based on the ratio of Market Value to Realized Value (MVRV).
The MVRV ratio is a popular indicator that, in short, tracks the ratio between the amount of Bitcoin investors currently hold (market cap) and what they originally spent to purchase their coins (available cap). This metric tells us about the profit/loss situation of the market as a whole.
Now, a pricing model called MVRV Extreme Deviation Pricing Bands uses standard deviations from the all-time mean of the MVRV ratio to determine key price levels for cryptocurrencies.
Below is a chart shared by an analyst that shows how the levels associated with this model have looked recently.
The middle yellow line of the chart represents the price level at which the average MVRV will equal its all-time average. Currently, this rate equates to approximately $52,900.
The level above this line, colored orange, corresponds to +0.5 standard deviation (SD) above the index mean. At the moment, the cryptocurrency spot price is below this mark, which means that the MVRV average deviation is less than +0.5 SD.
Ali notes that this level, corresponding to +0.5 SD, around $65,800, is “one of the most important resistance areas” for Bitcoin. The graph shows that Bitcoin struggled to break this level during retests in December 2023 and January 2024.
The analyst says that if BTC cannot pass this resistance, the $78,700 mark, which corresponds to +1 SD from the MVRV ratio means, could be the next important target.
Historically, asset peaks have been more likely to form when the MVRV ratio has deviated above this line. The all-time high (ATH) at the beginning of the year, which continues to be the climax of the rally, also occurred shortly after the stock rose above this level.
From Bitcoin’s current price, a rise to this target of around $78,700 would suggest an increase of more than 27% for the cryptocurrency. Before the stock can dream of retesting this level, it will need to break through the $65,800 resistance.
BTC price
Bitcoin crossed the $63,800 level yesterday but has seen a reversal in the past 24 hours, as its price has now dropped to $61,800.
