In all video coding standards, motion vectors are restricted to have the same resolution for the whole sequence. In this paper, we propose an adaptive motion vector resolution scheme to improve the coding efficiency. The scheme is based on an analytical model of motion compensated residue which studies the relationship between motion vector errors and the variance of the residue. With this model, the proposed scheme can adaptively select motion vector resolution with implicit signaling. Experimental results show that the proposed scheme can improve coding efficiency at slightly increased encoding complexity.