Bitcoin’s Market Value to Realized Value (MVRV) metric has recently produced a ‘death cross,’ sparking concerns of waning momentum and a potential macro top for the asset.
This indicator, which compares bitcoin’s market value to its realized value, is closely watched for signs of overvaluation and cycle reversals.
MVRV indicator signals exhaustion
According to CryptoQuant analyst Yonsei_dent, the MVRV momentum indicator has shown a clear death cross between the 30-day and 365-day moving averages. Yonsei_dent explained:
History doesn’t repeat, it rhymes — and the signals from MVRV deserve attention.
The previous occurrence of this bearish crossover coincided with the 2021 cycle peak, which was followed by a 77% price decline from $69,000 to $15,500 during the 2022 bear market.
Despite bitcoin’s 13% rise to a new all-time high of $124,500 between January and August, MVRV continued to decline, suggesting weakening capital inflows.
Analysts debate bear market risk
Ali Martinez, another market analyst, noted that the MVRV death cross indicates a macro momentum reversal.
If history repeats, short-term targets could fall to around $105,000, with some analysts warning of a possible further drop to $60,000 if a bear market takes hold.
Other indicators show room to run
However, not all signals are bearish.
The MVRV Z-score remains well below levels historically associated with market tops, currently “sitting at around 2,” according to analyst Stockmoney Lizards. They noted:
We’re not even close to the danger zone yet. People aren’t massively overextended on profits like they were at previous tops. This tells me we’ve got room to run.
Additionally, none of the 30 CoinGlass bull market peak signals indicate overheating, and historical MVRV Z-score peaks have ranged between 7 and 9.
