Bitcoin's Market Value to Realized Value (MVRV) ratio has fallen below its 365-day simple moving average, currently hovering near the 1.9 level, according to CryptoQuant analyst ShayanMarkets. This development suggests that Bitcoin may be entering an undervalued phase, historically indicative of a local price bottom formation.
The MVRV ratio decline coincides with an 18% drop in BTC price, from an all-time high of $126,000 to approximately $107,000, reducing speculative excess and potentially paving the way for long-term holder accumulation. Historical data shows that similar MVRV dips below the 365-day SMA in mid-2021, June 2022, and early 2024 preceded substantial BTC price rallies of up to 196%.
Analysts project that if this pattern repeats, short-term price targets could range from $115,000 to $190,000, with a potential surge to $240,000 if just 5% of gold's capital shifts into Bitcoin, as estimated by Bitwise. Gold has recently declined 8.5% from its peak of $4,380, leading experts like Michaël van de Poppe to speculate that this could trigger a rotation into Bitcoin and altcoins.
Upcoming macroeconomic factors, such as the US Consumer Price Index (CPI) report, could further influence market sentiment. A weaker-than-expected CPI might boost hopes for rate cuts, enhancing risk-on appetite and potentially accelerating Bitcoin's recovery into Q4 2025.
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