This chart presents the MVRV Momentum Oscillator, derived from the ratio between MVRV, and the 1yr moving average, minus 1.

Periods where MVRV trades above the 1yr SMA typically describe macro market uptrends, and periods below describe downtrends. Cycle transition points are often characterized by the MVRV breaking strongly across the 1yr SMA threshold, at which time this oscillator is designed to flip polarity.

• 🟥 Sharp declines (and negative values) indicate large volumes of supply have been recently transacted at higher prices, and have now fallen into an unrealized loss. This suggests a 'top heavy' market which may be sensitive to price declines.

• 🟩 Sharp increases (and positive values) indicate large volumes of supply have been recently transacted at lower prices, and have now returned into an unrealized profit. This suggests a 'bottom heavy' market following heavy capitulation, into accumulation.

Further References

For full details on the derivation of these models, please refer to our report Mastering MVRV.