As a seasoned researcher with a decade of experience in the crypto market, I have seen my fair share of bull runs and bear markets. The latest analysis by ‘Yonsei Dent’ regarding the Bitcoin MVRV ratio momentum caught my attention due to its historical significance.
A CryptoQuant analyst’s latest examination has sparked worries about the trend of the Bitcoin MVRV Value Momentum. The MVRV ratio, an essential metric for on-chain assessment, calculates the proportion between Bitcoin’s actual and market worth. It helps determine whether the market is excessively priced or underpriced.
Through the use of both short-term (30 days) and long-term (365 days) moving averages on this ratio, the analyst has noticed a change in market trend dynamics, which could indicate an impending significant market shift.
A Bearish Shift On The Horizon?
According to ‘Yonsei Dent’, the most recent analysis indicates that Bitcoin’s 30-day moving average has significantly dropped since it peaked at a record high in March 2024.
The decrease we’re experiencing is approaching a point where the 30-day moving average could go beneath the 365-day moving average, a state frequently called a “death cross” in technical study.
As a crypto investor, I keep a close eye on technical indicators to guide my investment decisions. One such indicator is the Death Cross, which occurs when a shorter-term moving average (in this case, the 30-day moving average) dips below a longer-term moving average (the 365-day moving average). In Bitcoin’s MVRV ratio, a Death Cross would signal that the short-term average price is falling relative to the long-term average, potentially indicating a bearish trend. It’s important to remember that while this indicator can provide valuable insights, it should not be used in isolation and always consider other factors before making investment decisions.
Historically, similar occurrences have frequently marked the start of downtrends in the Bitcoin market, making the current situation a crucial point to consider carefully. In particular, Dent highlighted:
Previously, when MVRV momentum showed a ‘death cross’, the market shifted towards a strong downtrend. Now, we need to keep an eye on whether the 30-day moving average (DMA) continues to drop. If the 30 DMA manages to hold up at the level of the 365 DMA and starts to increase again, it might suggest a possible rise in Bitcoin’s price.
Moreover, Dent pointed out that the Bitcoin MVRV ratio presently falls within a range of 1.8 to 1.9, implying that the market worth is approximately twice its actual worth. This finding suggests that although the market isn’t currently under extreme duress, it’s essential to exercise caution.
Bitcoin Technical Outlook
As an analyst, I find myself intrigued by Dent’s interpretation of the Bitcoin MVRV ratio suggesting a crucial turning point. Meanwhile, I can’t help but notice the bold prediction made by another respected analyst, Javon Marks, who has set a significant target for Bitcoin, inspired by its latest market movements.
As Marks suggests, Bitcoin’s price structure is based on a substantial Hidden Bullish Divergence pattern. Important milestones could potentially trigger a strong surge in Bitcoin’s value, with key resistance levels at approximately $67,559, hinting at an imminent upward trend. Marks points out this potential development.
If we temporarily halt and maintain that target at $116,652, prices could surge even more rapidly than expected, potentially increasing by an additional 72%. The recent fluctuations in Bitcoin’s value after it first reached $67,559 might have been merely a build-up for this upcoming phase towards six figures.
Currently, Bitcoin is being traded at around $59,864, which is below $60,000. As per crypto analyst Elja’s analysis, the price of this asset has been repeatedly rejected at the 4-hour 200 Exponential Moving Average (EMA) level. If Bitcoin manages to break through this level, a potential increase up to $64,000 could occur.
$BTC keeps getting rejected from the 4hr 200 EMA level
Flip and turn it into support and #Bitcoin will pump towards $64K-$65K
Otherwise, the consolidation will continue to happen!
— Elja (@Eljaboom) August 21, 2024
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2024-08-22 13:16