If the trend continues, the price of BTC could climb to $95,000.
The election results in the US could define bitcoin’s next moves.
The technical analysis indicator known as MVRV reflects that the bullish trend of bitcoin (BTC) remains intact. The market is closely following the results of the elections in the United States, which could define the movements of the digital asset in the short term.
According to him report from the data provider on-chain CryptoQuant, made by the trader known as CoinLupin, The MVRV (market value to realized value, in Spanish) is around 2, indicating that “the surface value of the market is double the estimated value on the blockchain”, which suggests that Investors, on average, are making profits.
The author of the report also explains that for his work “he prefers to adopt a traditional analytical approach, especially in a market influenced by numerous problems related to macroeconomics.”
It should be noted that the MVRV allows you to evaluate whether the price of an asset, in this case bitcoin, is high or low regarding the latest movements of investors. The metric is calculated by dividing the BTC market capitalization by the realized capitalization. In other words, the total value of BTC is divided based on the price at which they were purchased by traders. Thus, it can be defined whether they would obtain profits or losses if they sold their assets.
If the value of the market capitalization is higher than the realized capitalization, it means that investors are in profit and could be a reason for selling. When the market value is less than realized, reflects that the current price is lower than the average purchase price.
To support his analysis, the author shares a graph where you can see the price of the digital currency created by Satoshi Nakamoto (orange line) and the MVRV indicator (blue line) at the bottom. Areas painted green and red are then highlighted, representing low MVRV and high MVRV, respectively.
As seen in the previous graph, the MVRV is around 2.08indicating that the market capitalization is double the estimated value on the blockchain. However, as CoinLupin explains, “instead of this absolute value, I emphasize ‘trend-based judgment’.”
Specifically, what he proposes is to analyze the MVRV trends of recent years, instead of its current value. For this reason, he explains that he uses the indicator known as “Bollinger bands” of 365 days and the 4-year average.
Bollinger bands measure the volatility and price trend of an asset over a year. This technical analysis indicator allows you to identify where the BTC support and resistance zones could be located.
It consists of three black bands, as seen at the bottom of the graph above. The upper and lower lines determine the price volatility of BTC, while the central line is the moving average of a time period, generally 20 days.
“This suggests that the bullish trend remains intact and, in general, the peak of the cycle tends to occur when the MVRV reaches levels between 3 and 3.6. Assuming that the realized value (RV) remains constant, an increase of 43-77% is necessary,” details the author of the report.
From this technical analysis, projects a price target of $95,000 and $120,000. Finally, he emphasizes:
“While bitcoin has risen significantly over the past year, it has only returned to the average level of the MVRV indicator. The upward momentum is still maintained.”
CoinLupin, cryptocurrency market analyst.
Bullish expectation for bitcoin
The author of the CryptoQuant report mentions macroeconomic events that could affect the price of the digital currency.
One of these events is the elections in the United States, which have Kamala Harris (Democratic Party) and Donald Trump (Republican Party) as candidates for the Oval Office.
As CriptoNoticias has reported, BTC and cryptocurrencies played a central role in the campaign of the two candidates. It is estimated that in the main financial power there are more than 50 million users of digital assets and each of those votes could tip the balance to one side or the other.
The winner could be known this Tuesday, if the vote count advances quickly and the difference between Trump and Harris is wide.
In this context, the BTC price started the day below $68,000 but As the hours passed, it once again surpassed the $70,000 barrier.. At the time of publication of this note, the price is $69,900.
The market seems to be leaning towards a Trump victory, due to the promises he made during his campaign such as: establish a strategic national reserve of BTC and a regulatory framework to encourage the growth of the cryptocurrency sector.
Harris, Joe Biden’s vice president, mentioned digital assets in her campaign but failed to separate himself from the figure of the current managementwhich kept Gary Gensler as head of the Securities and Exchange Commission (SEC) of that country. During his management, the organization maintained a tough and sometimes confrontational stance with actors in the sector. There were even legal disputes with exchanges such as Binance, Kraken and Coinbase.
For analysts at Bernstein, a financial investment firm, The price of the digital currency could skyrocket to $90,000 in the short term if Trump is elected. On the other hand, if Harris were elected, they warn that the price could fall to $50,000.
However, the same firm anticipates that the digital currency will reach $200,000 in 2025, regardless of who the winner of the next elections is.
