Bitcoin Holds Steady as On-Chain Indicators Signal Possible Upsurge

Bitcoin is holding steady around $94,000 as key technical indicators suggest potential for upward momentum. The MVRV ratio is nearing a crossover with its one-year moving average, often linked to past price rallies. Meanwhile, Bitcoin’s price volatility is tightening, indicating a notable price movement could be imminent. Support levels at $93K and $83K are crucial for price direction going forward.

Bitcoin is currently grabbing attention as it holds the $94,000 mark while key technical indicators hint at possible movement. Notably, the MVRV ratio, which measures the market value of Bitcoin against its realised value, is creeping towards its one-year simple moving average. This crossover, often referred to as a ‘golden cross,’ bears historical significance particularly when linked to past BTC rallies. The interplay of these factors might just indicate a shift towards upward momentum.

Interestingly, the MVRV ratio is now around 2.3, while the 1-year average stands slightly higher. Analysts are keen on watching this trend because a bullish signal is likely if the MVRV crosses above the moving average. In fact, earlier this month, the MVRV ratio ascended quickly from around 1.8 to surpass 2.2, reflecting a growing optimism in the market.

Adding to this situation, Bitcoin’s trading body is squeezed into a tight range of $94,000 to $95,000 on the 4-hour chart. As the Bollinger Bands get narrower, the anticipation of increased volatility rises, hinting at a potential price move. According to trading expert Ali, this scenario suggests Bitcoin could experience significant price action shortly. He noted that this tightening comes on the heels of a considerable breakout from roughly $87,000 to nearly $95,000, followed by a period of consolidation.

If Bitcoin pushes upward through the upper band, we could see it rise even further. On the flip side, if it dips below the lower band, it may revisit critical support zones. Two key price levels are creating particular interest: $93,198, where about 3.22% of total Bitcoin supply sits, and $83,444, containing roughly 1.55%. Many coins have remained stagnant around these price points, and movements could trigger reactions among holders who are either in profit or facing potential losses.

Currently trading at $95,160, Bitcoin sits just above the pivotal $93,198 zone. Should the price maintain this position, market sentiment might stay stable for a while. However, if there’s a slip below this critical level, the next support in the spotlight would be the $83,444 range, possibly altering trading strategies for many.

Additionally, the Realised Price of Bitcoin’s “warm supply” offers another layer of insights. This metric tracks the price of recently moved coins compared to newly acquired ones. As of April 29, Bitcoin was trading just above the warm supply realised price of $94,551 at about $94,298. The MVRV for warm supply is at -0.0026, suggesting these holders are slightly underwater. A spike above this realised price could possibly validate profits for mid-term holders and alleviate any selling pressure, leading towards further market stability.

It’s worth noting that this crucial price level was negative earlier in March and April, aligning with market weakness. Maintaining stability around this level could play a significant role as the market regains strength.

Disclaimer: While the views shared in this article inform readers, they don’t serve as financial advice or investment recommendations. Engaging with cryptocurrencies carries financial risks that investors should recognise before jumping in.