The indicators on the Bitcoin chain indicate that the 2017-style bull market will continue

Bitcoin (Bitcoin) According to an indicator trying to predict the bottom and top of the market, the pullback from the historical high of $67,000 to below $60,000 did not prevent the bulls from paying attention to another peak in the future.

The risk indicator called MVRV represents the ratio of Bitcoin’s market value to its realized value—similar to the price-to-book ratio (P/B) ratio that compares a company’s market value to its book value. In the process, MVRV tries to determine whether the asset is undervalued or overvalued.

A bullish pattern similar to 2017

MVRV readings above 3.7 reminded Bitcoin to peak, triggering a sell-off.On the other hand, an MVRV reading below 1 means buying pressure on prospects Bitcoin bottoms out.

MVRV has always assisted Bitcoin traders in discovering transactions Pressure on the Bitcoin marketFor example, the orange overlay in the figure below represents the correlation between the Bitcoin price and its MVRV output.

Bitcoin price compared with MVRV. Source: CryptoQuant

Research director Lennard Neo explained in a new Stack Funds report released on November 4 that the current MVRV rebound is similar to the rebound found during the 2017 bull market, forming a series of higher highs and higher lows (green ) As the price of Bitcoin rises.

In addition, MVRV also experienced a similar rebound. Prices plummeted in May 2021, A drop below 1 indicates that the Bitcoin market is undervalued during this period. The indicator recovered well, creating higher highs and higher lows, confirming the upward trend of Bitcoin.

Neo wrote in a report published on November 4th: “Since the current trading price of MVRV is 2.72, which is much lower than the recent peak of 3.96 in February, we expect that as it retests the 4.0 handle, there will be further growth. Space” and added:

“If the MVRV upward trend appears in the near future, it may take some time before Bitcoin peaks.”

Bitcoin rose to 70,000 US dollars?

Neo added that Bitcoin has recently been able to use $60,000 as its support level, which shows its strong willingness to retest $67,000—even extending the upward trend to $70,000.

In addition to MVRV, the analyst also mentioned two on-chain indicators to explain his bullish outlook.This includes indicators that are tracked Bitcoin balances on all cryptocurrency exchanges And a wallet holding a large number of BTC tokens.

Specifically, the total amount of bitcoin held by global exchanges reached 2.311 million BTC, the lowest level in more than three years.

Bitcoin balances reserved by all exchanges. Source: CryptoQuant

Bitcoin’s largest investor also Accelerated their accumulation frenzy As Bitcoin prices recovered from the May-July 2021 crash.

According to Glassnode’s whale supply shock indicator, the so-called whale-an address holding 10,000 to 100,000 BTC- Increase their bitcoin purchases A period of recovery from a price of less than $30,000 after July.

Bitcoin whale supply shock. Source: Glassnode

Dor Shahar, an on-chain analyst at CryptoJungle, Call This is a sign of a “multi-month accumulation upward trend”, and it is predicted that Bitcoin will hit a record high because the whales take away more BTC supply from circulation.

related: The Bitcoin Whale indicator detects a multi-month cumulative trend, as BTC focuses on the $67,000 retest

“The ratio between the two groups of whales and other fishes can be a measure of supply dynamics,” he said, adding:

“therefore, [the indicator] It can help visualize the possible supply shortages of coins held by whales and their impact on prices. At the same time, a more sensitive macro top indicator. “

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