- BTC is up 10.38% on monthly chart
- Analysts are citing the historical relationship between MVRV and SMA 365 and are eyeing further upside.
Bitcoin in the last 30 days [BTC] has seen a significant rebound on the price chart after two months of extreme volatility. In fact, since hitting a high of $70,016 in July, BTC has fallen significantly, dropping to a local low of $49,000.
However, BTC has seen a notable rally since the Fed rate cut a week ago. At the time of this writing, Bitcoin was trading at $65,839. This marked an increase of 10.38% on the monthly chart and extended the bullish trend with an increase of 4.47% within 24 hours.
Will King Coin continue to rise?
This recent surge has caught the attention of the crypto community and is a hot topic among analysts. One of them was Cryptocurrency analyst Burak Kesmesi, who cited the MVRV indicator and suggested that the long-term rally could persist.
Source: Cryptocurrency
According to Kesmeci, Bitcoin’s MVRV indicator is currently giving a bullish signal again, with MVRV price above the SMA 365. After analyzing the historical relationship between MVRV and the 365-day moving average, the analyst determined that BTC is on a regular uptrend. After MVRV exceeds SMA365.
At the time of writing, the MVRV was 2.04, which was higher than the SMA 365 of 2.02. Therefore, analysts interpreted this as a strong bullish signal and assumed that bulls have room to lose in the market.
When MVRV and SMA 365 set up like this, it means the long-term trend is strengthening. Especially since BTC's current market value is higher than its average realized value over the past year. This upward trend is a sign of growing confidence among long-term holders and investors.
So, based on this observation, demand for Bitcoin is increasing, which could be pushing up the price.
What does the chart show?
The indicators highlighted by Kesmeci provided a positive outlook, but the question is what other fundamentals are showing.
Source: Cryptocurrency
First, Bitcoin exchange supply ratio has recorded a continuous decline over the past week. During this period, the exchange supply ratio decreased from 0.1311 to 0.1304.
This decline reflects the holding behavior of investors who hold their assets in cold wallets rather than exchanges. This is a bullish signal, implying that investors are confident in its future value as long-term holders expect the crypto price to rise.
Source: Cryptocurrency
Additionally, Bitcoin's fund flow ratio has been trending upward over the past week. FFR increased from 0.04 to 0.086 in the past 7 days.
This shows that the inflow of funds into BTC is increasing. In turn, this reflects growing investor confidence. In such market conditions, investors are more likely to purchase BTC in hopes of future profits.
Source: Cryptocurrency
Finally, the SOPR for short-term Bitcoin holders has also increased over the past week. An increase in short-term SOPR during an uptrend indicates market strength. Therefore, short-term holders are selling at a profit, but demand is also high enough that they can absorb selling pressure without incurring a decline. This means that the uptrend is likely to continue.
Simply put, BTC is experiencing positive market sentiment and increasing investor favor. If these market conditions hold, BTC will attempt to break through the $68,240 resistance level.
