Expert Warns of Further Bitcoin (BTC) Price Dip: Here’s Why

Bitcoin's Price Trend Analysis

Analyst Opinion

Top crypto analyst Ali expresses concerns about potential future declines in Bitcoin's value. Ali observes a pattern of price corrections following rejections of Bitcoin's Market Value to Realized Value (MVRV) ratio from its 90-day average since May 2024. The latest rejection has resulted in a 10% depreciation, suggesting the trend may persist.

MVRV Ratio Indicator

The MVRV ratio gauges whether Bitcoin is overvalued or undervalued by comparing the average purchase price of most coins with their current market value. Historically, rejections of this ratio from its 90-day average have preceded significant price corrections. Ali's analysis shows that each such rejection since May 2024 has led to a substantial price drop.

Historical Trend and Rejection Impact

Since May, each MVRV ratio rejection has triggered substantial Bitcoin corrections. In May, Bitcoin fell 16%, followed by 26% and 29% declines in June and July, respectively. August and September witnessed drops of 29% and 19%. The latest rejection in late September has already caused a 10% dip, indicating potential for further downside movement.

MVRV Oscillator

The MVRV oscillator, represented by purple dots on Ali's chart, measures Bitcoin's momentum and shifts between positive and negative trends. When the MVRV ratio is rejected at the 90-day average, the oscillator typically signals a shift to negative momentum, coinciding with sharp price decreases.

This pattern suggests Bitcoin's current price weakness may continue. Ali's analysis indicates that the oscillator's transition to negative momentum has historically prompted further declines. Traders should anticipate volatility if this trend persists.

Risks and Cautions

Previous MVRV rejections have been followed by notable price corrections. Ali's analysis suggests Bitcoin may experience further losses if the pattern continues. Given the 10% drop since the latest rejection, traders are concerned about potential additional declines.

Traders are advised to exercise caution and closely monitor the MVRV ratio for signs of continued Bitcoin price weakness.