- Bitcoin rode into a crucial bullish zone as the MVRV ratio crossed the 365-day MA
- Sentiment returned to neutral, despite an abundance of buying power
Bitcoin’s [BTC] recent volatility has done little to quash the signs of a bullish market. In fact, according to CryptoQuant’s market turbulence analysis, the coin’s Market Value to Realized Value (MVRV) ratio is now above its 365-day Moving Average (MA).
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The crypto-trading data platform opined that the rise was a consequence of the disruptions going on in the banking sector. The MVRV ratio describes the ratio of a cryptocurrency’s market cap to its realized cap. And, the same is used to assess the asset’s valuation, including market tops and bottoms.
At press time, Bitcoin’s MVRV ratio was 1.13. When the metric is below 1, it is a sign of a possible market bottom. On the contrary, when it’s above 3.7, it indicates a market top or an overvalued state of an asset.
Source: Glassnode
So, the metric revolt above the bottom could signal a possible return of the bull market. This, because the MVRV ratio has struggled to hit the current spot since the market downturn of 2022.
One of the reasons why BTC’s price appreciated was because the crypto-market gained from liquidity transfer from the troubled traditional finance district. Consider this – Circle’s USDC stablecoin de-pegged from the U.S dollar last week. However, the Fed’s Funding Term helped propel it back to $1, also extending the benevolence to the broader market.
Furthermore, CryptoQuant mentioned that the decision helped BTC find support for the 1 million to 3 million age bands. This metric evaluates a cohort’s holding behavior by overlaying a set of different realized prices. An evaluation of the metrics implied that Bitcoin whales have been restrained from selling their coins after a makeshift trade-off.
Source: CryptoQuant
At press time, BTC was exchanging hands at $26,261, with the crypto recovered from its fall below $25,000 a little over 12 hours ago. At the time, this decline had affected the crypto’s Fear and Greed Index too, with the latter falling from ‘greed’ to ‘neutral.’
With Bitcoin shrugging off $26,000 now, more ‘greed’ can be expected hereon.
Read Bitcoin’s [BTC] Price Prediction 2023-2024
Additionally, Glassnode’s datasets revealed that the Stablecoin Supply Ratio (SSR) is at a low point now. The metric serves as a measure of the demand and supply mechanics between BTC and stablecoins.
The reading for Bitcoin’s SSR was 3.54, at press time. This implied that there is a significant difference between the upper and lower Bollinger Bands on the 200-day MA. Simply put, there seems to be enough stablecoin supply and purchasing power for the world’s largest cryptocurrency.
Source: Glassnode
