The MVRV Z-Score indicator for Bitcoin is approaching levels that historically preceded major bull runs.
In 2015 and 2019, when this metric dipped below 0.1 it signaled Bitcoin was undervalued right before parabolic rallies occurred. Some analysts believe we could be nearing the last buying opportunity before another huge Bitcoin upswing.
The brief dip into the green zone on the MVRV Z-Score chart typically marks the end of a bear market. While further panic-driven drops to the low $20k level are possible in the short-term, many view the current zone under $24k as a clear buy area this cycle.
However, most short-term Bitcoin holders purchased at higher prices and are currently at an unrealized loss. Over 88% are currently underwater. Meanwhile, long-term holders continue accumulating.
If history repeats, the MVRV Z-Score suggests Bitcoin may be on the cusp of explosive growth after a period of heavy bearish sentiment. Still, analysts caution traders to brace for high volatility in the months ahead.
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