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U.Today – In early weekly trading, , and the rest of the crypto market saw profits, with around $252 million reported in crypto liquidations.
Bitcoin consequently fell to a low of $101,221 before recovering to an intraday high of $103,292. However, at the time of writing, it pared some of its gains but was still up 1.6% in the last 24 hours to $102,796.
Ethereum fell to a low of $3,831 in the early Sunday session, extending the decline from Saturday’s trade. This dip was met with buying, and ETH returned to intraday highs of $3,906.
Ethereum has been aiming to reach $4,000 for the past four days, with the bulls’ attempt lingering just above $3,900.
On the other hand, Bitcoin is constantly testing resistance above $100,000, increasing the likelihood of a breakout. While the market remains bullish on both crypto assets, MVRV, an essential indicator for predicting market tops and identifying bottoms, suggests what could be next for BTC and ETH.
What the MVRV indicator suggests
In a recent analysis, on-chain analysis platform IntoTheBlock examines the MVRV indicator against major cryptocurrencies, including Bitcoin and Ethereum.
Market Value to Realized Value (MVRV) is a critical metric for timing cryptocurrency market cycles and identifying potential tops. This ratio shows whether the price is higher or lower than what investors paid on average, indicating overvalued or undervalued conditions.
According to IntoTheBlock, historically, Bitcoin finds its bottom in the market when the MVRV ratio falls below 1 and peaks when it exceeds 3. Each cycle has shown a decline in the peak MVRV, indicating that future peaks may occur at lower ratios.
Bitcoin’s MVRV is at 2.5, indicating that the market is heating up, but is still far from peaking.
However, Ethereum’s MVRV paints a complex picture due to strong early increases that quickly bring initial buyers into profit. Historically, the MVRV of the Ethereum market has been around 0.7, with a peak of 2.7 in the last cycle. Its current MVRV of 1.76 implies that it has room for further growth before reaching peak valuation levels.
