Ethereum MVRV Hits 2.1 at $4.5K: Overextension Risks Correction
Ethereum trades around $4,500 with an MVRV of 2.10, indicating a potential near-term overextension. On-chain data from Glassnode shows roughly $10 billion in leveraged ETH positions were liquidated over three days, causing Open Interest to drop by 7% in a single session. Historically, similar MVRV spikes have coincided with local tops and corrections. Traders should monitor MVRV and Open Interest alongside exchange flows, and target buy-the-dip zones at prior accumulation ranges. Risk management measures—reducing leverage, tightening stop-losses, and phased entries—can help navigate potential pullbacks before sustainable upside.
Bearish
The current MVRV of 2.10 at a $4,500 price level suggests Ethereum is in an overbought state, historically aligning with local tops. The removal of approximately $10 billion in leveraged positions and a 7% drop in Open Interest reflect significant on-chain deleveraging, which typically precedes consolidation or deeper corrections. Similar patterns were seen in previous market cycles where sharp leverage purges led to short-term pullbacks. Consequently, traders are likely to reduce exposure and tighten risk controls, weighing on upside momentum. While long-term fundamentals remain intact, these on-chain signals point to a bearish bias in the near term.