BITCOIN

Bitcoin MVRV shows are not yet at the top, BTC still has room to grow


The MVRV index shows that Bitcoin has not yet reached the top, and crypto may still have room to grow.

The Bitcoin MVRV ratio could show that the top could not be reached

As indicated by a CryptoQuant post, on-chain data suggests that MVRV ratio values ​​are still low, indicating that the currency has not yet risen to the top.

The ratio of market value to realized value (or MVRV for short) is a bitcoin indicator that divides the market cap by the realized cap.

MVRV ratio = market cap ÷ implemented cap

The value of the metric tells us whether the current value of BTC is fair. If the ratio is too high, it could mean that the currency is overvalued right now. This means that there is selling pressure at this time.

On the other hand, the value of a currency can be considered devalued when the MVRV ratio is low. A purchase pressure may be present while maintaining such values.

Now, here is a chart that shows the price trend of this Bitcoin index over the last few years:

Looks like MVRV values are still not very high | Source: CryptoQuant

As the graph above shows, during all previous bull runs, the value of the indicator shows a sharp spike near the top.

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Since the very high values ​​indicate that Bitcoin has been overvalued and a correction may be coming soon, the MVRV ratio can be used to spot the tops. Similarly, low quality can be considered as a good buying opportunity.

Looking at the chart, the value of the index now seems to be lower than what was seen in the early 2021 rally (and also during the 2017 bull run). So it could mean that BTC may not be at the top, even if it has declined in the last few days. And crypto may still have more room to grow.

BTC price

At the time of writing, the price of Bitcoin is about $ 59k, up 9% in the last seven days. In the last thirty days, the value of the currency has risen by 5%.

The chart below shows the price trend of BTC in the last five days.

Bitcoin price chart

BTC's price has dropped off in the last few days | Source: BTCUSD on TradingView

With Bitcoin approaching its new all-time high of $ 69k, the currency is on the decline. In the last few days, crypto has mostly shown sideways movement.

Related Reading | Pickup Preview: November is a red rain for bitcoin holders

There are no signs of recovery yet, but if anything like the MVRV ratio, the value of BTC could still go up during this run.

Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com



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