Reserve Risk climbs again as long-term holders rapidly release old Bitcoin, indicating potential overvaluation and a shift in holder confidence.
MVOCDD activates for the third time in Bitcoin's recent cycle, with each prior alert followed by market corrections and consolidation.
Historical patterns show that synchronized Reserve Risk and MVOCDD spikes have consistently aligned with local Bitcoin price tops in previous instances.
Reserve Risk is flashing a renewed warning, suggesting Bitcoin may be nearing a local top as long-term holder activity increases.
MVOCDD Indicator Triggers for the Third Time
In a recent post, Darkfost_Coc noted that Reserve Risk is signaling a possible top, driven by long-term holder coin movements. The market recently saw a sharp release of older Bitcoin, sold within a short period.
This surge activated the MVOCDD indicator—an advanced metric built on Coin Days Destroyed (CDD) that tracks the velocity of spent coins. The increase in MVOCDD suggests that holders with older coins have decided to sell, a pattern previously seen near local peaks.
According to the tweet, this is the third time MVOCDD has flashed such a reading. During the previous two events, Bitcoin experienced short-term corrections and periods of market consolidation.
https://twitter.com/Darkfost_Coc/status/1951208382049710533
Reserve Risk Reflects Overvaluation in the Market
Reserve Risk is designed to assess the confidence of long-term investors relative to Bitcoin’s price. When the ratio becomes high, it may reflect overvaluation, as holders become more willing to spend their coins.
Currently, Reserve Risk has reached levels often seen at local tops. The latest trend points to long-term holders taking profits, reinforcing the relevance of the signal. During earlier periods when this metric reached similar levels, price retracements followed shortly after.
The current behavior in Reserve Risk and MVOCDD together reveals a changing sentiment among longer-term participants.
LTH Behavior Suggests Short-Term Uncertainty
The sharp movement of dormant Bitcoin reinforces that long-term holders are adjusting their strategy. This behavior has previously foreshadowed temporary cooling phases in the market.
As Darkfost_Coc stated, the indicator has accurately marked short-term market turning points. With this being the third such instance, many traders will likely keep a close eye on Reserve Risk.
While this does not suggest a major reversal, it does increase the likelihood of price stabilization or short-term retracement in the near term.
