Key takeaways:
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Bitcoin’s MVRV ratio dropping below its 365-day average signals a local bottom, historically preceding big price rallies.
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Capital rotation from gold could fuel the Bitcoin rebound, according to analysts.
Bitcoin (BTC) could be poised for a sustained recovery in the coming weeks, as a key valuation metric sends a bullish signal. The BTC market might be forming a “cyclical bottom,” according to crypto analysts.
Bitcoin’s MVRV metric signals a “local bottom”
Bitcoin’s Market Value to Realized Value (MVRV) ratio, an indicator that measures whether the asset is overvalued, recently slipped below its 365-day moving average, indicating that BTC could be at a local bottom, according to CryptoQuant analyst ShayanMarkets.
Related: Bitcoin chart is echoing the 1970s soybean bubble: Peter Brandt
The “MVRV ratio currently stands near 1.9, slightly below its 365-day moving average,” the analyst said in a QuickTake analysis on Monday, adding:
“Historically, each time the ratio dropped below the 365 SMA, it has marked a buying opportunity and a local bottom signal.”
The last time this happened was in mid-2021, June 2022, and early 2024, preceding 135%, 100% and 196% rallies in BTC price, respectively.
This consistent pattern suggests that Bitcoin is once again “entering an undervalued phase, where long-term holders typically begin accumulating,” the analyst wrote.
With an 18% BTC price drop to $103,530 on Friday from $126,000 all-time high, the MVRV declined, “reflecting reduced speculative excess and growing long-term confidence,” the analyst said, adding:
“If this metric begins to turn upward from current levels, it could confirm that the recent sell-off was a cyclical bottom formation, supporting a renewed bullish phase into Q4.
If history repeats itself, Bitcoin price could embark on a prolonged recovery, with analysts projecting short-term targets around $115,000 and even as high as $190,000 if the last leg of the bull run unfolds.
Capital rotation from gold to boost BTC price
Data from Cointelegraph Markets Pro and TradingView revealed that gold is down 8.5% from its all-time high of $4,380 reached on Monday.
That’s a “pretty harsh move on gold,” MN Trading Capital founder Michaël van de Poppe said in a Tuesday X post.
If this continues, it would mean gold has “peaked for the moment,” a sign that “the rotation” into Bitcoin and altcoins may be starting, van de Poppe wrote.
The US Consumer Price Index (CPI) report for September is expected to be released on Friday, according to the Bureau of Labor Statistics.
“A soft CPI print should trigger the fuel for potential rate cuts and the end of the government shutdown,” the analyst said, adding:
“Bitcoin to start running as risk-on appetite comes back into play.”
Meanwhile, Bitwise analysts suggest that a 5% shift from gold to Bitcoin could drive the price of Bitcoin to $240,000.
Bitwise says a 5% capital rotation from gold to Bitcoin could send BTC to $242,391 👀 pic.twitter.com/FwvjneWhdX
— Bitcoin Archive (@BTC_Archive) October 21, 2025
As Cointelegraph reported, gold’s ongoing pullback could trigger Bitcoin’s rebound, with technical analysis projecting a BTC price rally to $150,000–$165,000 by year’s end.
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