The Bitcoin MVRV ratio has now dropped to its long-term mean value, triggering bullish sentiments amid favorable historical precedence.
Notably, Bitcoin’s recent price activity has involved short-term uncertainty following an impressive rally from late April. After surging by nearly 16% from $84,466 on April 19 to a local high of $97,938 on May 2, the flagship crypto asset has entered a period of stagnation.
Over the past two trading days, Bitcoin has seen back-to-back intraday losses, and early market signals suggest a potential third consecutive dip as of today, with the price currently hovering around $93,901. Despite this lull, on-chain indicators may indicate a brewing resurgence.
Bitcoin MVRV Ratio in Bullish Position
One of the most important signals comes from the Bitcoin MVRV Ratio, which has now retraced to its long-term average of 1.74. According to Glassnode, this level represents a reset zone typically seen during consolidation phases.
Bitcoin MVRV Ratio | Glassnode
Historically, such pullbacks have cooled off unrealized gains, setting the market up for new bullish cycles. A notable instance occurred in August 2024 when the Bitcoin MVRV Ratio hit this same level. What followed was a powerful uptrend, with Bitcoin logging three consecutive monthly gains from September to November 2024.
This rally extended into December, where heightened optimism surrounding Donald Trump’s presidential victory pushed the asset to an all-time high of $108,364. Although Bitcoin experienced a modest 3.17% correction at that peak, the market held strong.
Notably, the Bitcoin MVRV Ratio recently returning to 1.74 suggests the market may be undergoing a similar reset, potentially priming for another leg up.
For context, the metric measures the ratio between market value and realized value, helping investors gauge when Bitcoin is overvalued or undervalued. When the ratio drops to its mean, this typically indicates a phase of market stabilization, with room for renewed momentum.
Other On-chain Metrics Supporting a Bullish Outlook
In addition to the Bitcoin MVRV Ratio, several other on-chain metrics lend support to a bullish outlook. Currently, 88% of the circulating Bitcoin supply remains in profit, with losses mainly concentrated among investors who purchased within the $95,000 to $100,000 range.
88% of #Bitcoin supply remains in profit, with losses concentrated among buyers from the $95k–$100k range. This metric also rebounded from its long-term mean, indicating a broad reset of investor expectations without widespread capitulation. pic.twitter.com/fL2oDrP0BR
— glassnode (@glassnode) May 5, 2025
This distribution implies that most holders are still in a good position and that the market hasn’t experienced major capitulation. More notably, this profitability metric has also recovered from its long-term average, indicating a healthy correction rather than a panic-driven selloff.
Moreover, the Realized Profit/Loss Ratio has climbed back above 1.0. This indicates that, on average, sellers are now realizing profits rather than losses. Importantly, it also suggests the current demand is strong enough to absorb profit-taking pressure, a positive sign for potential market recovery.
Bitcoin Realized Profit Loss Ratio | Glassnode
Bitcoin Market Analyses Mixed
Meanwhile, market analyses have been mixed. The pseudonymous analyst BitBull remains firmly bullish. In his latest assessment of the daily chart, he identified a breakout from a falling wedge pattern.
$BTC bullish
Breakout from falling wedge
• Clean structure
• Strong momentumCurrently retesting the breakout zone (blue circle).
Next leg could send us towards 130K+.
Invalidation below 86K. pic.twitter.com/EHygDNE3dp
— BitBull (@AkaBull_) May 5, 2025
He stressed that the breakout boasts strength, noting that Bitcoin is currently retesting the breakout zone. This suggests it could be setting up for another upward move. BitBull speculated that the next rally could drive the price beyond $130,000, with downside risk becoming more likely only if Bitcoin drops below $86,000.
On the other hand, Carl Moon, a well-known market analyst and founder of The Moon Show, is not entirely bullish. He observed today that Bitcoin had broken down from a rising wedge on the 4-hour chart, typically a bearish signal.
🚨 #Bitcoin might be in danger! $BTC broke down of this rising wedge. It seems there’s simply not enough volume to go up for now.
The next support is at ~$91,700. If it fails to hold, the next one is at $88,500. pic.twitter.com/EcNC6BGUwA
— Carl Moon (@TheMoonCarl) May 5, 2025
According to Moon, the current price action lacks the necessary volume to sustain an upward trend. He called attention to $91,700 as the nearest support level and warned that a breach below this point could send Bitcoin tumbling toward $88,500.
