“Bitcoin may be facing some challenges on shorter timeframes following the launch of the Bitcoin ETF spot fund. However, when we zoom out a bit, the overall picture remains optimistic.
One of the encouraging signs comes from the Market Value to Realized Value (MVRV) ratio, a classic tool used to measure Bitcoin’s ‘fair value.’ This metric is tracked by the blockchain analysis company Glassnode.
When MVRV significantly deviates from the average value, it tends to coincide with market price tops and bottoms. Currently, MVRV is hovering around the average level, moving above and below it in a pattern reminiscent of both 2016 and 2020, just before Bitcoin started its historic bull runs.
As Ali noted in accompanying comments, ‘In previous bull markets, Bitcoin has shown strong recoveries after touching the average MVRV Pricing Band.’
We are witnessing a similar pattern now. With the recent rise from the average MVRV at $40,500, there is a possibility that BTC could rise to the Standard Deviation 1.0 level at $60,000!