U.Today - A rare and potentially bearish signal has appeared for Bitcoin (BTC) as the MVRV Death Cross emerges, raising concerns about growing downside risks. According to a recent CryptoQuant Quicktake, Bitcoin’s MVRV (Market Value to Realized Value) ratio has reached a crucial phase, hinting at a shift in market momentum.

The MVRV (Market Value to Realized Value) ratio is an important on-chain indicator that compares Bitcoin’s market capitalization to its realized value, helping to spot periods of market overvaluation or undervaluation.

In general, a high MVRV indicates an overheated market, whereas a low value indicates probable undervaluation.

The MVRV 30DMA has formed a bearish death cross with the 365DMA, indicating weakening short-term momentum and growing downward pressure. As with past cycles, this cross was followed by a price decrease when Bitcoin reached a local top, demonstrating the MVRV’s usefulness as a market sentiment indicator.

What comes next?

With the MVRV now converging toward its long-term historical average, CryptoQuant indicated that it appears the market might have exited the overheated zone. However, no definitive bottom signal has emerged yet.

As Bitcoin continues to follow a corrective pattern similar to previous cycles, investors should be wary of additional downside risk.

Bitcoin (BTC) fell 2.31% in the previous 24 hours to $81,449 during early Asian-market hours on Monday, as the weekend decline saw major tokens lose momentum following last week’s brief rise. Bitcoin is on course for its fourth day of declines since March 27, with today’s dip reaching an intraday low of $81,265.

What do other indicators reveal?

Glassnode’s Bitcoin Cost Basis Distribution provides insight into current investor behavior. Per this indicator, the most efficient traders bought nearly 15,000 BTC at the $78,000 low on March 10 and sold at the $87,000 local top. With little BTC left at the $78,000 level, support there is now thin.

The support cluster of $80,920 exists below Bitcoin’s spot price, where nearly 20,000 BTC were added. If the correction deepens, six-month cost basis data points to this potential structural support below the spot price: $74,000, where 49,000 BTC were added, and $71,000, where nearly 41,000 BTC were added.

According to Glassnode, these levels reflect conviction-driven accumulation zones that could absorb additional downside pressure. Meanwhile, a key resistance may be forming around $95,000, where investor cost basis clusters have grown by 12,000 BTC since March 24.

This article was originally published on U.Today