Bitcoin NVT Golden Cross Surged To 3.17 During Recent Peak
An analyst in a CryptoQuant Quicktake explained that the NVT Golden Cross may have served as an indicator of the recent top in cryptocurrency prices.The “NVT” refers to an on-chain metric that tracks the ratio between Bitcoin’s market cap and transaction volume (both in USD). This ratio is generally used to determine whether the asset’s price is fair or not.
In the context of the current discussion, the NVT itself isn’t interesting, but rather, a modified version called the NVT Golden Cross is. This metric compares the short-term trend of the NVT (10-day moving average) against its long-term trend (30-day MA).
The value of the metric seems to have been going up in recent days | Source:As displayed in the above graph, the Bitcoin NVT Golden Cross rose to relatively high levels earlier. This growth happened as the asset’s price rallied towards the $71,000 level.
The metric had touched the 3.17 mark in this surge, which suggests the coin may have become too overpriced. Indeed, the asset followed this by observing a sharp drawdown, which took it back under the $65,000 level.
As the quant has marked in the chart, a similar pattern of the NVT Golden Cross hitting these high levels and resulting in a price correction was observed at different points over the last few years. Since the latest overheated signal, the indicator has cooled off alongside the Bitcoin price, although it hasn’t gone towards the negative side yet.BTC Price
Bitcoin has recovered over the past day as its price has now climbed back to $67,800.Looks like the price of the asset has seen some uplift over the last 24 hours | Source: