Bitcoin (BTC) needs to go lower before establishing a macro bottom, according to one of the most accurate indicators in the market.
Data from sources like on-chain analytics firm Glassnode shows that Bitcoin’s MVRV-Z Score is almost, but not quite, signaling a possible trend reversal.
MVRV-Z Score Approaches Potential Macro Bottom
Amid the ongoing debate over whether or when the BTC/USD pair will go beyond its current lows of $17,600, the new figures suggest the market easily has yet to go lower.
What points out Filbfilb, co-founder of the Decentrader trading team, the MVRV-Z Score is now in its classic green zone, but not yet at the point that has accompanied price bottoms in the past.
The MVRV-Z Score measures how high or low Bitcoin’s spot price is relative to what is called its “fair price.”
It uses market cap and realized price data along with standard deviation to create what has turned out to be one of the most efficient Bitcoin high and low prediction tools.
MVRV-Z has hit every frame top and bottom of the BTC/USD pair in its history, and has done so with an accuracy of two weeks, data resource LookIntoBitcoin notes.
The metric has only dipped below its green zone a couple of times, most recently in March 2020, but further downside pressure would see that happen again.
“This chart is *the only one* for me,” Filbfilb commented on recent readings.
“We usually hit rock bottom when MC
A floor at USD 16,000 gains relevance
A price of $15,600 would match many of the predictions about where Bitcoin is going to set a price floor.
In an update to its Twitter followers over the weekend, the popular CryptoBullet account listed that area as one of several important support zones to watch.
$16,000, if confirmed, also marks the average deviation from Bitcoin’s 50-month moving average.
Some very important #BTC levels:
16k – Average Deviation from MA50 (-25%)
14k – 2019 Echo Bubble Top
12.2k – Celsius Liquidation
10.7k – Key Horizontal Level https://t.co/hEcnj8wsak pic.twitter.com/1Xke0F7WSe
— CryptoBullet (@CryptoBullet1) July 2, 2022
Bitcoin’s Relative Strength Index, or RSI, is already at its lowest levelanother indication of the oversold nature of a market that is now below its previous halving cycle high near $20,000.
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