U.Today – In early Sunday trading, , and the rest of the crypto market took a profit, with nearly $252 million in crypto liquidation reported.
As a result Bitcoin fell to a low of $101,221 before rebounding to an intraday high of $103,292. However, at the time of writing, it had pared some of its gains but was still up 1.6% to $102,796 in the last 24 hours.
Extending its decline from Saturday’s trading, Ethereum fell to a low of $3,831 in Sunday’s opening session. The decline was met with buying, and ETH reached an intraday high of $3,906.
Ethereum has been targeting $4,000 for the past four days, with the bulls trying to stop above $3,900.
On the other hand, Bitcoin is repeatedly testing resistance above $100,000, raising the possibility 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 may come next for BTC and ETH.
What does the MVRV indicator suggest?
In a recent analysis, on-chain analytics platform IntoTheBlock explores the MVRV indicator in relation to major cryptocurrencies including Bitcoin and Ethereum.
The Market Value to Realized Value Ratio (MVRV) is an important metric for timing cryptocurrency market cycles and identifying potential peaks. This ratio shows whether the price is higher or lower than the average price paid by investors, indicating overvalued or undervalued conditions.
According to IntoTheBlock, historically, Bitcoin finds its market bottom when the MVRV ratio falls below 1 and peaks when it exceeds 3. Each cycle has demonstrated a decline in 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 still has a long way to go before reaching its peak.
However, Ethereum’s MVRV paints a complicated picture due to strong initial growth that quickly puts early buyers in profit. Historically, Ethereum’s bear market MVRV has been around 0.7 with a peak of 2.7 in the previous cycle. Its current MVRV of 1.76 indicates that it has room for further growth before hitting peak valuation levels.
