Bitcoin’s price movement is still slowing down and it has not seen any major jumps over the past few weeks. There could be some changes in the future trajectory of this digital asset, as the Bitcoin MVRV ratio could be signaling a bottom signal.
Bitcoin MVRV Ratio Reaches 2019 Lows
Recently, Cryptoquant’s CEO and co-founder took to Twitter to share his experience as CEO. share This chart is very interesting. The image showed that the bitcoin MVRV Ratio has fallen to levels that have not been seen since 2019 – three years ago.
The bitcoin MVRV Ratio now compares BTC’s market capitalization to its realized value. This helps to determine if the digital asset is actually trading at a fair value, if it’s overvalued, or if it is currently undervalued. BTC will be less valued the lower it falls.
The market was at its lowest point when the BTC MVRV Rate fell to similar levels as that shown in the Cryptoquant Chart. This happens during bear markets when the market is at its lowest point. Prices drop for a long time before rising again.
Source: Cryptoquant| Source: Cryptoquant
The chart shows that the MVRV ratio was lowest at certain times. These are the years before the current bottom. The bull market was activated in two months, one in 2015 and the other in 2019.
This chart is a confirmation that the BTC top is either in place or very close to it, according to history. Based on the timelines for when the MVRV Ratio fell so low in the past, it may be several months before another bull market is activated.
What to do with these Trends
Investors have a unique opportunity to buy bitcoin at one of its lowest prices before another bull run, due to the low bitcoin MVRV Ratio. BTC’s previous undervaluation has led to a bull market that saw its price reach a new all time high.
Investors may not lose a lot even though this price is not at its bottom. The lack of interest in the market in the market has beaten down investor sentiment but it brings into play a strategy proposed by legendary investor Warren Buffett: “Be greedy when others are fearful.”
BTC trending at $16,855 as of the writing. It has risen 0.64% over the past 24 hours and 1.21% over the last seven days.