The price movement of Bitcoin has lately interested analysts, including top crypto analyst Ali, who warns of more dips to come. Ali claims that since May 2024, continuous corrections from the rejection of Bitcoin’s Market Value to Realized Value (MVRV) ratio from its 90-day average have followed.
Given that the most recent rejection has already caused a 10% decline in BTC’s value, it implies that the trend may go on.
The MVRV ratio is one crucial indicator of whether Bitcoin is overpriced or undervalued. This is accomplished by contrasting the price at which most coins were last traded with the current market value of Bitcoin.
When the ratio is rejected from its 90-day average, it has historically preceded major price corrections. Ali’s analysis shows that since May 2024, each rejection from this key level has resulted in a substantial price drop.
In May, Bitcoin dropped 16% followed by a 26% drop in June and July. Moreover, in August, it corrected 29% and in September, it dropped 19%. The most recent rejection, which came in late September, has already caused a 10% drop, suggesting more possible negative impact.
What you'll learn 👉
MVRV Oscillator Signals Caution
The MVRV oscillator, represented by purple dots on Ali’s chart, measures Bitcoin’s momentum. It also indicates shifts between positive and negative trends. Whenever Bitcoin’s MVRV ratio faces rejection at the 90-day average, the oscillator signals a shift to negative momentum, aligning with sharp price declines.
This pattern suggests that Bitcoin’s current price weakness may not be over. Ali’s chart analysis points out that the oscillator’s transition to negative momentum has typically led to further drops. If the trend continues as it has over the past several months, traders should be prepared for more volatility.
Historical Rejections and Future Risks
Each of the MVRV rejections since May has been followed by significant price corrections. These historical trends, as outlined by Ali, indicate that Bitcoin may experience additional losses if the pattern repeats. With Bitcoin already down by 10% since the latest rejection, the potential for further price dips remains a concern for traders.
Per CoinGecko data at press time, Bitcoin trades at $61,151.45. This reflects a 0.45% decline in the last day and a 6.60% drop over the past week. Given the MVRV ratio’s rejection, analysts and traders are closely watching for signs of continued weakness in Bitcoin’s price.
Doge2014 raises 500K in days celebrating Dogecoin. Make potentially big profits and get in on exclusive airdrop!
Show more +Read also: Solana Price Prediction: Can SOL Reclaim $144 or Fall Lower?
Traders Urged to Stay Cautious
Supported by historical data, Ali’s analysis underlines the dangers connected to the present price of Bitcoin. Although Bitcoin is still a top asset in the crypto market, its recent price swings imply that traders should approach the market carefully since more losses could be expected.
This warning reminds Bitcoin buyers to keep a close eye on the MVRV ratio in search of more indicators of possible declines.
Follow us on X (Twitter), CoinMarketCap and Binance Square for more daily crypto updates.
Get all our future calls by joining our FREE Telegram group.
We recommend eToro
Wide range of assets: cryptocurrencies alongside other investment products such as stocks and ETFs.
Copy trading: allows users to copy the trades of leading traders, for free.
User-friendly: eToro’s web-based platform and mobile app are user-friendly and easy to navigate.
