Bitcoin’s Market Value to Realized Value (MVRV) ratio is sending a bullish signal, with analysts suggesting a potential price rebound may be imminent.
MVRV ratio indicates local bottom
CryptoQuant analyst ShayanMarkets reported that Bitcoin’s MVRV ratio has fallen below its 365-day moving average, a level that has historically marked local bottoms and buying opportunities. The analyst stated:
“Historically, each time the ratio dropped below the 365 SMA, it has marked a buying opportunity and a local bottom signal.”
Previous instances of this pattern—in mid-2021, June 2022, and early 2024—preceded significant rallies of 135%, 100%, and 196% in Bitcoin’s price.
ShayanMarkets explained that this trend suggests the market is entering an undervalued phase, typically when long-term holders begin accumulating.
For further context, see the bitcoin mvrv chart and the bitcoin mvrv z score chart.
Recent price movements and market confidence
Following an 18% drop in BTC price to around $103,530 from its all-time high of $126,000, the MVRV ratio declined, reflecting decreased speculative excess and growing long-term confidence.
ShayanMarkets added:
“If this metric begins to turn upward from current levels, it could confirm that the recent sell-off was a cyclical bottom formation, supporting a renewed bullish phase into Q4.”
Capital rotation from gold to bitcoin
Michaël van de Poppe, founder of MN Trading Capital, noted a sharp 8.5% drop in gold from its all-time high, suggesting capital may shift from gold to bitcoin.
Bitwise analysts estimate that a 5% capital rotation from gold to bitcoin could push BTC as high as $242,000.
Upcoming economic data
The upcoming U.S. Consumer Price Index (CPI) report could influence market sentiment.
Van de Poppe commented that a softer CPI print may encourage rate cuts and end the government shutdown, potentially boosting bitcoin as risk appetite returns.
