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The Bitcoin Price Drop: Has It Ended? Keep An Eye On This Support Level

Over the last week, Bitcoin's price took a major nosedive, bringing down the whole cryptocurrency market with it. At one point throughout the week, the leading cryptocurrency hit a low of $59,500, its lowest level in over two months.

Even while investors are crossing their fingers that this is all done, it's still hard to tell whether Bitcoin is prepared to continue its positive trend. Whatever the case may be, a well-known crypto intelligence outfit has pinpointed a vital price point for Bitcoin's future trajectory.


Metcalfe price valuation bands are the important indication here since they identified the preceding cycle's resistance levels and peaks. These bands, shown by the red line in the graphic below, did, however, provide crucial assistance in May.

Just so you know, according to the Metcalfe Law, a network's value grows as the square of its user count. This rule basically says that the bigger and busier the Bitcoin network is, the more valuable the cryptocurrency is going to be.

The Metcalfe price valuation bands, which provide a framework for pricing linked to the network effect, are developed from this theory. Based on the principles of the network, these bands provide a range of possible price levels for Bitcoin.

These bands have served as solid support and resistance levels throughout the market's history. The $56,000 mark has served as an indication pivot point in the last several months, and the price of Bitcoin found solid support there in May.

The price level may end up being crucial, according to CryptoQuant's study, if the leading cryptocurrency experiences more downward pressure. Nevertheless, a significant correction might occur in the market leader if the price of Bitcoin falls below this level.


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