Why $90,000 Matters For Bitcoin

Higher prices don’t feel a million miles away, but after a rally of over 50% from the lows and a couple months of sideways, the next leg higher hasn’t arrived quite as quickly as some might have hoped. So what’s holding us back?

 

Three things to watch:

• Bitcoin’s historical MVRV median is around 1.64, currently equivalent to a price near $88,500.
• Since 2015, Short Term Holder MVRV has recorded medians of 1.174 at local peaks and 0.860 at local troughs.
• The MVRV median, 2-year moving average and short-term-holder upper deviation band all converge around $90,000.

 

Resistance Overhead

MVRV compares Bitcoin’s market value with its realised value, the value of coins at their last on-chain movement. Here we’re using the raw ratio, and what we found is that the historical median is approximately 1.64. That means half the observed readings sit above this level and half below.

 

Figure 1: MVRV sits beneath its historical median of approximately 1.64.  

 

View Live Chart

 

Translated into a Bitcoin price, that median currently sits around $88,500, close to the recent highs.

 

To look at the smaller moves within a cycle, I ran a similar analysis using Short Term Holder MVRV, and it records a median peak of 1.174 and 0.860 at troughs. Those readings put price roughly 17% above or 14% below the cohort’s aggregate cost basis, and levels where we typically see some mean reversion… as we just experienced in the past few weeks.

 

Figure 2: STH MVRV records median peaks of 1.174 and 0.860 at local troughs.  

 

Meeting At $90,000

Putting those observations onto the price chart gives us three resistance measures converging around $90,000: the MVRV median, the 2-Year Moving Average and the short-term-holder upper band. 

 

Figure 3: MVRV Median, 2YMA and the STH Upper Band proxy converge near $90,000. 

 

Given how closely those levels line up, it wouldn’t surprise me if we struggle here for a while. Consolidation gives the cost-basis measures time to catch up with price. A convincing break above this area would make the case for faster upside hard to ignore!

 

Until Next Time

I’ll be presenting at Bitcoin Amsterdam next month. If you’d like a ticket, send me a message on Twitter and I’ll help sort it out!

 

 

For more on this, watch our recent YouTube video here:

Bitcoin’s Bull Market Has A $90,000 Hurdle

 

Have a lovely week, and I’ll see you in the next one!

 

@MattCrosbyPro

Research Director