The post Bitcoin MVRV Ratio At Make-Or-Break Test: Will Support Hold? appeared on BitcoinEthereumNews.com.

On-chain data shows that the Bitcoin Market Value to Realized Value (MVRV) ratio is doing a retest that has historically been significant for BTC. Bitcoin MVRV Ratio Is Retesting Its 365-Day SMA Right Now As explained by an analyst in a CryptoQuant Quicktake post, the Bitcoin MVRV ratio is retesting a level that has acted as an important psychological level in the past. The “MVRV ratio” here refers to a popular on-chain indicator that, in short, compares the value that the investors are holding (that is, the market cap) against what they used to purchase the cryptocurrency (the realized cap). When the value of this metric is greater than 1, it means the investors can be considered to be in profit right now. Tops can become more likely to form the higher the ratio above this mark, as holders become increasingly tempted to harvest their gains. On the other hand, the indicator being under the level implies the dominance of losses in the market. Bottoms can be probable in this zone, as sellers become exhausted here. Naturally, the MVRV ratio is exactly equal to 1 suggests the investors are holding profits and losses in equal parts, so the average holder could be assumed to be just breaking even on their investment. Now, here is a chart that shows the trend in the Bitcoin MVRV ratio, as well as its 365-day simple moving average (SMA), over the last few years: As displayed in the above graph, the Bitcoin MVRV ratio has been observing a decline since the price all-time high (ATH) set back in March. This trend is because BTC has been riding on bearish momentum since then. Investor profits, which had once ballooned to relatively high levels due to the rally, have taken a sizable hit because of the price…

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Filed under: News - @ July 9, 2024 9:14 am