Bitcoin MVRV Ratio Hits Crucial Level, What This Means For Price?

Bitcoin (BTC USD) MVRV ratio hits crucial 2.2 level converging toward 365-day moving average. Historical patterns suggest Bitcoin price increases follow similar convergence periods consistently.

Unrealized profits reached $1.4 trillion new high creating potential distribution pressure. Long-term holders reduce positions while ancient miner wallets activate after 15 years dormancy.

Bitcoin (BTC USD) MVRV Ratio Approaches Key Technical Convergence Point

Bitcoin MVRV ratio is presently 2.2 moving towards its 365-day moving average. The metric indicates if the price is overvalued or undervalued in the history.

Values below 1 show low points, while numbers above 3.7 indicate high points.

Historical convergence periods toward the moving average preceded price increases consistently.

The MVRV ratio increases to extreme levels in its wake. Similar to stock prices of firms, Bitcoin doesn’t remain close to long-term averages for long.

CryptoQuant analysis shows Bitcoin is in energy-consolidation stage before next upward movement.

The MVRV ratio appears poised to rise into the overvaluation area shortly. The price is currently at about $118,600, with recent trends indicating stabilization.

Bitcoin 24-hour range is $116,079 – $118,865 showing contained volatility. Seven-day range is $115,184 – $119,568. All-time high of $122,838 on July 14 just 17 days ago.

Current Bitcoin price is 3.4% off all-time high forming potential breakout situation. Technical convergence aligns with historical tendencies leading to big moves.

MVRV analysis sets the context for understanding current market positioning. Bitcoin is set to move potentially higher according to indicator convergence.

Unrealized Profits Reach Record Highs

Bitcoin’s unrealized profit as a percentage of market cap broke above +2σ band. This level historically ties to euphoric phases in previous market cycles.

The setup mirrors previous all-time high environments creating latent sell-side pressure.

According to Glassnode data, total unrealized profit of all Bitcoin (BTC USD) holders hit new high of $1.4 trillion.

This massive paper gain concentration sets stage for potential distribution pressure. If Bitcoin prices continue higher, concentrated gains could cause selling activity.

Long-term investors, who invested for 155 days and above, control 53% supply. In spite of recent dispersal, these investors still hold high levels of Bitcoin.

We require continuous demand to manage possible selling by long-term holders. The LTH/STH supply ratio fell by 11% within 30 days, indicating a shift. The trend is setting long-term investors against new market entrants.

The continued rotation into distribution preceded prior all-time highs historically. This highlights structurally consistent shift in investor positioning across cycles.

According to Lookonchain data, ancient miner wallets from April 26, 2010 awakened after 15 years. Five dormant wallets transferred 250 Bitcoin worth $29.6 million recently.

Each wallet originally earned 50 Bitcoin from mining operations in 2010. The activation of old wallets adds to potential distribution pressure.

Market Participants Prepare For Final Bitcoin Price Move

Analyst Merlijn The Trader warns the final Bitcoin move approaches with key patterns.

Retail investors will FOMO while market makers prepare to dump positions. The current zone offers exit opportunities for holders seeking liquidity.

Selling into strength provides better outcomes than selling into regret scenarios. The analyst identifies current levels as exit zone for traders. Missing this opportunity could result in unfavorable exit conditions later.

Market situation show rotation from long-term holders to short-term participants. The 11% drop in LTH/STH supply ratio over 30 days indicates position shifts. This pattern preceded previous all-time highs across Bitcoin cycles consistently.

The 2010 miners transferred 250 Bitcoin after 15 years, which contributes to the supply. Each wallet received 50 Bitcoin when it was easy to mine.

Present Bitcoin price at $118,600 is close to new all-time high of $122,838. 3.4% from the top leaves space for the final breakout. But distribution indicators caution new buyers to watch out.