The NVT Golden Cross indicates that Bitcoin currently has a high market capitalization while network transaction volume is low.
NVT is calculated by dividing the market capitalization by the network transaction volume. A high market cap with low transaction volume suggests that Bitcoin's price may be inflated due to speculative activity. This often leads to or indicates potential pullbacks.
The NVT metric can be used for both short-term and long-term analysis. At this point, it's advisable to wait until the indicator moves into the green zone, which signals a period where the market capitalization is low and transaction volume is increasing. Such conditions typically present a buying opportunity.
Currently, the NVT indicates that the pullback is likely to continue and that the recent price rise was driven by manipulation. For the upward trend to be sustainable, transaction volumes on the network must increase.
Written by BorisVest
