The article discusses the debate on whether Bitcoin’s peak at £109,000 signifies the market’s top, supported by the MVRV Z-Score analysis. Historical patterns suggest a bearish outlook, yet recent signs of bullish recovery raise questions about the market’s direction.
After a significant increase that saw Bitcoin reach £109,000 earlier this year, analysts are now speculating if this peak indicates the end of the current market cycle. The Market Value to Real Value (MVRV) Z-Score has recently displayed patterns that hint at this possible market top, with technical indicators reinforcing this perspective.
Tony Severino, a crypto analyst, has conducted a technical analysis that combines the MVRV Z-Score with the monthly Relative Strength Index (RSI). His findings suggest caution, as Bitcoin’s MVRV Z-Score has recently fallen below its established uptrend support line, a movement typically seen post-market peak. This trend is reminiscent of previous peaks in the 2017 and 2021 cycles.
The relationship between the Z-Score and Bitcoin’s monthly RSI also denotes declining momentum. Historical trends indicate that RSI levels below 70 appear shortly after price peaks, confirming a potential bearish outlook. Current indications, such as the RSI-based Moving Average (MA) curling downward, further support the assertion that Bitcoin may have reached its peak at £109,000.
Due to these developments, coupled with significant price corrections and a decline in investor confidence, there is growing concern Bitcoin may be entering a prolonged bear market. This trend aligns with the typical post-peak behaviour observed in previous cycles.
Despite the bearish sentiment, Severino recently noted that bulls are attempting to regain control and initiate a price recovery. If bulls can maintain momentum as April concludes, it might change the previously bearish narrative surrounding Bitcoin.
According to Severino’s analysis, Bitcoin is currently testing a pivotal zone while displaying preliminary signs of reversing bearish trends on the long-term Moving Average Convergence Divergence (MACD). The formation of a potential Morning Star candlestick pattern may indicate a forthcoming bullish reversal, reminiscent of significant turnarounds in 2022 and mid-2023 that reshaped Bitcoin’s trajectory.
