Original text: Bitcoin Magazine Pro
Translation: Simplified Blockchain
As we approach 2025, it is time to examine the situations Bitcoin may face this year in a rational and analytical manner. By combining multiple factors such as on-chain data, market cycles, and macroeconomic data, we can go beyond mere speculation and paint a data-driven picture of the market trends for the coming months.
1. MVRV Z-Score: Huge upward potential
MVRV Z-Score measures the ratio between Bitcoin's realized price (the average purchase price of all Bitcoins in the network) and its market capitalization. By standardizing the volatility of this ratio, we obtain the Z-Score, which historically can clearly present the trends of market cycles.
Figure 1: MVRV Z-Score shows we still have a long way to go before reaching the market cycle peak
Currently, the MVRV Z-Score indicates that we still have significant upward potential. Although the Z-Score in previous cycles has exceeded 7, I believe that any value above 6 indicates market overextension, requiring closer observation of the market peak in conjunction with other indicators. Currently, our level is comparable to May 2017—when Bitcoin's price was only in the thousands of dollars. Considering the historical context, there is still potential for hundreds of percentage points of upward movement from current levels.
2. PiCycle Oscillator: Bullish momentum recovering
Another key indicator is the PiCycle top and bottom indicator, which tracks the 111-day and 350-day moving averages (the latter multiplied by 2). Historical data shows that when these two moving averages cross, it usually indicates that Bitcoin's price will peak within a few days.
Figure 2: The macro trend remains bullish
The distance between these two moving averages has started to rise again, indicating that bullish momentum is recovering. Despite several periods of consolidation in 2024, the current breakout suggests that Bitcoin is entering a stronger growth phase, which may last for several months.
3. The exponential growth phase of the cycle
From Bitcoin's historical price trends, cycles typically last 6 to 12 months during the 'post-halving cooling' phase before entering an exponential growth phase. Based on previous cycle data, we are approaching this breakthrough point. Although returns may decline compared to earlier cycles, we could still see significant price increases.
Figure 3: Compared to previous bull market cycles, we are nearing the most bullish phase of the cycle
As background information, after breaking through the previous historical high of $20,000 during the 2020 cycle, Bitcoin's price peaked at nearly $70,000, an increase of 3.5 times. If we see a conservative estimate of growing 2 or 3 times from the last peak of $70,000, Bitcoin could realistically reach between $140,000 and $210,000 during this cycle.
4. Macroeconomic factors supporting Bitcoin's performance in 2025
Despite facing some resistance in 2024, Bitcoin continues to perform strongly, even in the context of a strengthening US dollar index (DXY). Historically, Bitcoin's trend is usually inverse to that of the DXY, so if the DXY shows a strong reversal, it could further propel Bitcoin's upward space.
Figure 4: Even with a significant rise in the US dollar index, Bitcoin still rises
Other macroeconomic indicators, such as the high-yield credit cycle and global M2 money supply, indicate that the market environment for Bitcoin is improving. The contraction of money supply in 2024 is expected to reverse in 2025, laying the foundation for a more favorable market environment.
5. Cycle main chart: There is still a long way to go
The Bitcoin cycle main chart aggregates multiple on-chain valuation indicators, showing that Bitcoin still has considerable growth potential before reaching overvaluation. Currently, the upper limit is around $190,000, and this upper limit continues to rise, further reinforcing the prospects for sustained upward momentum.
Figure 5: The 'overvaluation' level of the cycle main chart has exceeded $190,000, conclusion
Currently, almost all data indicators point to a bullish 2025. As always, past performance does not guarantee future results, but the data strongly suggests that Bitcoin's best days may still lie ahead, even in the context of an already exceptionally positive performance in 2024.
(The content above is excerpted and reprinted with the authorization of partner PANews, original link | Source: Simplified Blockchain)
Statement: The article only represents the author's personal views and does not represent the viewpoint and position of Blockchain. All content and views are for reference only and do not constitute investment advice. Investors should make their own decisions and trades, and the author and Blockchain will not bear any responsibility for direct or indirect losses arising from investors' trades.
"Interpreting Bitcoin's market trends in 2025 from data indicators and macroeconomic perspectives" was first published on (Blockchain).
