Bitcoin continues to hover just below $119,000, with recent data indicating that the market cycle may approach its peak in late August.
MVRV Indicator and Forecasts
CryptoQuant analyst Yonsei Dent pointed out the significance of the 365-day MVRV Ratio as a key signal. This indicator compares Bitcoin’s market price to the average cost at which all coins were last moved. According to Dent, this indicator is approaching a level that previously marked major cycle tops. "In 2021, the MVRV 365DMA formed a double top. The second peak came about six months after the first and lined up closely with the bull market top," he wrote. A similar structure seems to be unfolding now, with the second peak likely forming around September 10, although the price top could arrive sooner, possibly in late August.
US-EU Trade Deal Boosts Crypto Market Sentiment
Market sentiment improved over the weekend after the US and EU reached a trade deal. Tariffs on European goods will drop from 30% to 15%, while Europe has committed to buying $750 billion in US energy and investing in joint infrastructure projects. This news helped elevate both stocks and cryptocurrencies.
Technical Analysis of Bitcoin
Bitcoin is still consolidating, hovering just below the psychological $120,000 mark. Although Bollinger Bands indicate that volatility is tightening, price action has remained above the 20-day moving average. The relative strength index is down to roughly 61, indicating cooling momentum but not necessarily a reversal. The current setup allows for a brief pullback before any additional upward movement, although a breakout is still possible. If Bitcoin surpasses $120,000, it may rise toward $125,000. However, there could be a decline to the $114,000 range if support at $117,899 fails to hold.
Overall, the current market conditions suggest a potential peak in the coming weeks, but traders need to remain cautious and manage risks in the face of uncertainty.
