Bitcoin News Today: Bitcoin's Bleeding Metric: A Market in the Crosshairs of Correction

Bitcoin’s MVRV (Market Value to Realized Value) ratio has dropped below its 365-day simple moving average, a signal often associated with extended market corrections, according to recent on-chain analytics. The MVRV metric, which measures the current market value of Bitcoin relative to its total realized value (the cumulative value of all coins based on their last movement), is a key indicator of whether holders are net profitable or at a loss. When the ratio falls below its long-term average, it suggests that a significant portion of the network is now in negative territory, which can lead to increased selling pressure and a broader correction phase [1].

The current MVRV reading indicates that the market may be entering a phase of heightened bearish momentum. Historical data has shown that periods of extended underperformance often follow similar on-chain patterns. This dynamic is particularly concerning given Bitcoin’s recent price action, which has seen it retreat from recent highs, testing key support levels in the $110,000 to $108,800 range. Analysts suggest that if these levels fail to hold, further downward movement could be expected, especially if bearish on-chain metrics continue to deteriorate [1].

In parallel, on-chain metrics such as the Spot Taker CVD (Cumulative Volume Delta) and funding rate indicators are reinforcing the bearish narrative. While these metrics are typically used for altcoins like TRX, they serve as useful analogies for understanding broader market sentiment. A negative Spot Taker CVD, for example, indicates that selling pressure is dominating the order book, while a negative funding rate suggests that short positions are gaining dominance over longs in derivatives markets. These conditions, if seen in Bitcoin’s data, would further signal increased risk of a deeper correction [1].

Tron’s recent breakdown below its key ascending trendline and rejection at its yearly high of $0.370 also highlight how broader market dynamics can influence altcoin performance and, by extension, investor sentiment toward Bitcoin. The weakening momentum in TRX reflects a broader shift in market structure, moving from a bullish to a bearish stance. Should Bitcoin continue to follow similar patterns, key technical indicators like the RSI and MACD are likely to show bearish divergence, reinforcing the probability of extended downside movement [1].

Market participants are closely monitoring Bitcoin’s interaction with its key support levels. A successful defense of the $108,800 to $110,000 range could provide a near-term floor for the asset, allowing for a potential consolidation phase. However, failure to hold these levels may force the price to retest the 50-day EMA and potentially accelerate the correction. In either case, on-chain data remains a critical tool for tracking the evolving dynamics of the market and preparing for potential scenarios [1].