Indicator Overview

The STH MVRV indicator approximates the market-to-cost relationship for short-term holders by reconstructing a synthetic acquisition basis using a 155-day liquidity-weighted rolling price model. The algorithm isolates recently active positions by filtering price action within the short-term holding window and computes the ratio of current market price to this inferred cost anchor. This produces a probabilistic valuation metric that quantifies realised versus unrealised gains among STHs, capturing the degree of overextension or compression in speculative capital deployment without relying on direct on-chain movement data.

A value above 1.0 indicates that the average short-term holder is currently in profit, while a value below 1.0 signifies that the average short-term holder is holding at a loss. The metric reveals short-term market sentiment and saturation.

How To Use

The STH MVRV provides actionable insight into potential short-term market extremes and capitulation. Significant readings well above 1.0 (historically around 1.5 to 2.0, coloured dark red/orange) suggest the market may be approaching a short-term top or peak euphoria, which could be a opportune moment for prudent profit-taking.

Conversely, sustained readings below 1.0 (where the average short-term holder is underwater) often pinpoint periods of heavy capitulation and deep value, signalling a potentially attractive buying or accumulation zone.