[Analysis] Bitcoin Signals Market Entering Late-Stage Bear Phase, CryptoQuant Says
Summary
- CryptoQuant contributor Yonsei Dent said the market appears to be entering the late stage of a bear market and a bottoming phase based on Bitcoin and the MVRV indicator.
- He said the recent drop in MVRV to 1.19 puts it near a level generally interpreted as a market undervaluation zone.
- Yonsei Dent said the current situation resembles the late stage of the 2022 bear market, adding that while short-term volatility may continue, the period may be worth considering for staggered buying by long-term investors.
Forecast Trend Report by Period
Bitcoin, the largest cryptocurrency, remains in a correction phase, and the market may be moving into the late stage of a bear market, according to a CryptoQuant analysis.
In a report published on June 5, CryptoQuant contributor Yonsei Dent wrote that Bitcoin’s MVRV ratio recently fell to 1.19. The relationship between MVRV, the 365-day moving average and the 4,000-day moving average suggests the market is entering a bottoming phase.
MVRV, or market value to realized value, measures market capitalization relative to realized capitalization and reflects investors’ average profit position. The indicator is generally viewed as signaling undervaluation when it falls below 1, while higher readings suggest a greater risk of overheating.
Yonsei Dent said the current pattern is particularly similar to the late stage of the 2022 bear market. After similar signals emerged in 2022, Bitcoin traded sideways for an extended period before entering a bull market. While short-term volatility may continue, long-term investors may want to consider staggered buying, he added.
Uk Jin
wook9629@bloomingbit.ioH3LLO, World! I am Uk Jin.
