Bitcoin MVRV Movement Signals Potential Bull Run, Analysts Say
Despite some market turbulence mid-week, Bitcoin (BTC) closed the week on a positive note, with a price gain of 4.07% according to CoinMarketCap. This positive performance follows last week’s breakthrough above the $60,000 mark. However, uncertainty looms over whether BTC has truly entered a bullish trend.
Analyst Points to Key Indicator for Bitcoin’s Bull Run
Crypto analyst Ali Martinez highlighted the importance of Bitcoin’s Market Value to Realized Value (MVRV) ratio in determining a bullish phase. The ratio needs to surpass its 90-day moving average to confirm a bullish trend after weeks of sideways movement. A high MVRV ratio could indicate overvaluation, while a low ratio suggests undervaluation.
Potential Long Squeeze Risks with $2 Billion BTC Futures Contract
In other news, traders have opened $2 billion in futures contracts within 48 hours, signaling high market interest in Bitcoin. However, this increase in leveraged positions poses a risk of long squeezes if BTC’s price drops, leading to forced liquidations and downward pressure on the price.
At present, BTC is trading at $62,875 with a 1.59% loss in the past day. Its daily trading volume has decreased by 16.75% to $36.4 billion.
In conclusion, Bitcoin’s MVRV ratio crossing above its 90-day moving average could indicate a bullish transition, potentially driving BTC towards $68,000-$70,000. However, the rise in futures contracts poses long squeeze risks. Stay informed and engaged with the evolving crypto market trends for September.
[Source: Ali_Charts on X]
[Featured image from The Motley Fool, chart from Tradingview]
