Amid the general market decline, 97,602 traders have liquidated in the past 24 hours, with the combined liquidation value reaching $274.73 million. The leading coin, Bitcoin (BTC), has extended its decline, slipping by 1%, while its trading volume plummeted by 20% during the same period.
Interestingly, a key on-chain metric has flashed a buy signal, suggesting an opportunity for BTC contrarian traders. However, caution is advised, as the market still faces potential downside risks.
Bitcoin Flashes Buy Signal
Bitcoin’s market value to realized value (MVRV) ratio, which measures the overall profitability of all its holders, is the on-chain metric of interest here. As of this writing, the coin’s 30-day and 90-day MVRV ratios are -0.89 and -1.48, respectively.
Generally, a negative MVRV indicates that the current market price is below the average price at which most investors acquired the asset. Therefore, if all holders were to sell their coins at the current market price, they would collectively realize a loss.
However, the metric also offers some respite. Historically, negative MVRV ratios represent a buying signal. They indicate that the market is oversold, and a potential buying opportunity could exist. A negative MVRV shows that the asset is being traded below its historical acquisition cost and may be due for a rebound.
Read more: Top 7 Platforms To Earn Bitcoin Sign-Up Bonuses in 2024
Some traders are already heeding the buy signal and have begun to accumulate the leading coin. Recently, there has been an unprecedented surge in new whale activity, marking levels of involvement never seen before.
“ Look at how fiercely the new whales are stacking Bitcoin; this market has never seen
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Author: Abiodun Oladokun
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