Amid the general market decline, 97,602 traders were liquidated in the last 24 hours, with a total liquidation value of $274.73 million. Major coin Bitcoin (BTC) continued its downward trend, falling 1%, while trading volume fell 20% during the same period.
Interestingly, major on-chain indicators are sending buy signals, offering an opportunity for BTC contrarian traders. However, caution is advised as the market still faces potential downside risks.
Bitcoin Shows Buy Signal
Bitcoin’s Market Value to Realized Value (MVRV) ratio is an on-chain metric that measures the overall profitability of all holders. Bitcoin’s current 30-day and 90-day MVRV ratios are -0.89 and -1.48, respectively.
Typically, a negative MVRV indicates that the current market price is lower than 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, this indicator also provides some comfort. Historically, a negative MVRV ratio is a buy signal, suggesting that the market is oversold and a buying opportunity may exist. A negative MVRV shows that the asset is trading below its historical acquisition cost and a rebound may be expected.
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Some traders have already taken notice of the buy signal and started accumulating major coins. Recently, there has been an unprecedented surge in whale activity, with participation levels reaching all-time highs.
“Look at how wildly the new whales are accumulating bitcoin; this market has never seen this kind of accumulation,” Kiyoung Joo, founder of CryptoQuant, said in a post on X.
This buy signal may encourage some traders to increase their BTC holdings, but it is important to note that there is still a risk of further downside. The buying pressure in the market continues to trend downward, and BTC’s Relative Strength Index (RSI) is currently at 44.88.
