How can on‐chain metrics like MVRV and SOPR signal potential market recovery opportunities?
Why is this the correct answer?
This is correct because MVRV (market value to realized value) shows if the market price is above or below what investors paid on average. SOPR (spent output profit ratio) measures realized profit or loss on coins moved. When MVRV drops below one and SOPR nears one, it signals that prices are undervalued and profit-taking has slowed. Beginners can view these metrics as tools to identify when selling exhaustion may lead to price rebounds.
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