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The MVRV Z-Score indicator for Ether, Ethereum’s native asset, has recently fallen to its lowest level in 17 months, drawing significant attention. This indicator allows for a comparison between Ether’s market value and its realized value. The decrease in the indicator suggests the possibility of a bottom forming in Ethereum’s current valuation. Technical analyses and on-chain data reveal potential recovery zones and risks that have caught the interest of market participants.
MVRV Z-Score and the Ethereum Market
The MVRV Z-Score is a crucial metric that compares Ethereum’s market value to its historical average price. A drop in this score typically indicates that a digital asset is undervalued. Historical data shows that when the MVRV Z-Score remains in the green zone, it signals that Ether has reached a favorable price level for long-term investors. Furthermore, significant market movements have historically followed similar declines, attracting investor interest.
On-chain data plays a vital role during this period. According to the data, large investors and long-term holders have increased their holdings of Ethereum 
$2,340 as the price declined. The amount of Ether transferred to major accumulation addresses has reached its highest levels in recent years. This indicates that large investors are actively accumulating assets despite the market price drop, though it remains uncertain when these accumulations will spark market activity.
Technical Analysis and Price Movements
Technical analyses indicate that Ethereum’s price movements are shaped around support and resistance levels. It is noted that the price has found support between the lower trend line of a symmetrical triangle formation and the 200-week moving average. Analysts suggest that the ETH price has the potential to recover from this level. Particularly, if the price surpasses Fibonacci levels, Ether may trend towards higher resistance areas.
However, if the lower trend line of the triangle is breached, risks may increase. In this scenario, the price could potentially decline to lower levels. Historical market movements show that such breakouts can lead to prolonged downward trends. Investors are carefully monitoring current market conditions to formulate their strategies.
