The MVRV indicator represents the ratio between Market Value and Realized Value, indicating how overvalued the current market is. Applying monthly (🔴30 DMA) and yearly moving averages (🔵365 DMA) to the MVRV indicator makes it easier to understand its momentum. For example, when the 30 DMA crosses the 365 DMA with a steep slope, forming a death cross, the market tends to transition into a bear market. Additionally, during the 2015-2018 and 2019-2022 cycles, when the 365 DMA peaked, the price also reached its top.
📌Currently, no death cross is observed in the MVRV momentum, and the 365 DMA continues to show an upward trend. The current MVRV is 2.13, indicating that the market is generally at an unrealized profit level of +113%, suggesting it is still early to see fear of loss or decline.
💡Considering that the 365 DMA's peak in past cycles formed around the 2.7 level, and the current 365 DMA is at 1.9, there may still be potential for further growth.
Written by Yonsei_dent