#Bitcoin Pumps, But NVT Divergence Raises Eyebrows! ๐ง๐
Bitcoin has risen beyond $120,000 in the previous 24 hours. After a significant decrease this week, the move signals positive momentum.
On-chain data is showing strong transactional support as the price approaches its all-time high. Analysts have noted a discrepancy between Bitcoin's market value and network activity.
In a recent QuickTake article, CryptoQuant analyst Sunflowr Quant noted the NVT Golden Cross indicator's peculiar behavior.
Due to a huge increase in on-chain activity, Sunflowr believes this statistic, which is predicted to grow with price as a ratio between market value and transaction volume, is decreasing.
Bitcoin On-Chain Growth Indicates Network Strength
Sunflowr believes this inverse link between the increasing BTC price and declining NVT Golden Cross suggests that Bitcoin network activity and transactions are driving the current rise rather than speculative trading.
โA decline in the NVT ratio during a price increase implies that transaction volume is rising faster than market cap,โ he stated. This suggests the surge is underpinned by genuine economic activity.โ
This supports the idea that good on-chain growth may support sustained pricing rises. If transaction volumes are expanding organically, not only from derivatives speculation, user adoption and financial utility are supporting prices.
Investors observing these signs may benefit, but other measurements suggest market dynamics are changing.
Holder Rotation May Change Market Participation
A separate CryptoQuant analyst IT Tech investigation illuminates holder behavior in Bitcoin's market structure.
In โHolder Rotation,โ IT Tech reports that long-term BTC holders, those who have held for more than 155 days, are selling more than collecting.
However, short-term holders are again net accumulating, a characteristic of late-stage rallies.
Both April 2021 and November 2023 handoffs preceded local peaks or cooling.
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