The Bitcoin market saw a modest recovery over the past week following the 15.7% correction in the second half of December 2024. Amid this recent price gain, the evolution of short-term holder activity (STH) has revealed significant signs for Bitcoin in the coming days.
Bitcoin STH MVRV at 1.1 with more room to run
According to a recent X postBlockchain analytics firm Glassnode shared a data report on the MVRV ratio of short-term holders of Bitcoin relative to the market price.
In cryptography, the market value to realized value ratio (MVRV) is a fundamental analysis tool used to assess whether an asset is overvalued or undervalued. It is also used to track the profitability of holders; Values greater than 1 indicate profits and values less than 1 indicate losses.
According to Glassnode’s report, the Bitcoin STH MVRV ratio is currently 1.1, suggesting that short-term holders, i.e. investors who purchased Bitcoin in the last 155 days, are experiencing a 10% gain on average. %. Considering the BTC price drop in recent weeks, there could be increased selling pressure as these holders move to take their profits, leading to near-term price resistance.
However, Glassnode data indicates that Bitcoin’s MVRV STH ratio previously reached peaks of 1.35 in November 2024 and 1.44 in March 2024. These MVRV values suggest that short-term holders can tolerate levels of higher profitability before triggering a widespread sell-off.
If Bitcoin bulls maintain the current price rally with increasing demand, the STH MVRV ratio could approach these all-time high levels, which could indicate confirmation that Bitcoin resumes its bullish trend in the market.
BTC Must Avoid Falling Below $87,000 – Here’s Why
In relation to the Bitcoin STH MVRV ratio, 1.0, which indicates no profit or loss, is understood to be a fundamental value that acts as support during bullish trends or as resistance in a bearish market trend.
The Glassnode report reveals that the current STH MVRV ratio shows that 1.0 corresponds to the $87,000 price zone. According to Cumulative Supply and Demand Delta data, there is an air pocket between $87,000 and $71,000, meaning there is little trading activity or fewer significant buy orders in this price range. Therefore, if the BTC price falls below $87,000, it will not find any significant support until $71,000, which will result in a major price drop.
At the time of writing, the top cryptocurrency continues to trade at $98,081, reflecting a 1.02% gain over the past day. With a market capitalization of $1.94 trillion, Bitcoin continues to rank as the largest asset in the cryptocurrency market.
