Bitcoin’s Price Dip Triggers Alert On NVT Golden Cross—Here’s What To Watch For

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As a seasoned researcher with over a decade of experience in the volatile world of cryptocurrencies, I’ve seen more than my fair share of price corrections and bull runs. The recent dip in Bitcoin’s price has stirred up quite a storm within the community, leaving many traders questioning the future trajectory of this digital gold.

The decrease in Bitcoin‘s price after reaching a record peak has led some in the cryptocurrency world to contemplate whether the ongoing upward trend will continue or if another directional shift is imminent. This uncertainty surrounds potential future price fluctuations.

At present, Bitcoin’s trading price is just under $95,000, representing a decrease of almost 7% from its peak of over $99,000 reached on November 22.

BTC NVT Golden Cross Outlook

In the midst of a recent decline in its value, an analyst from CryptoQuant named Darkfost has provided insights about the current market situation, particularly focusing on a crucial on-chain indicator: the NVT Golden Cross. This indicator, which measures the balance between market capitalization and transaction volume, recently showed a positive signal.

However, Darkfost cautioned against interpreting this shift as inherently bullish. He noted that while the current NVT Golden Cross value is low and doesn’t pose significant risks, traders should keep an eye on it to avoid potential market pitfalls.

Significantly, the NVT Golden Cross, which compares Bitcoin’s market capitalization to its transaction volume, might serve as a precursor for market movements. As per Darkfost’s analysis, when this ratio reaches approximately 2.2, it may imply that Bitcoin’s value surpasses its practical transactional worth.

In similar situations, Darkfost pointed out that the market could experience a “return to average,” which could present possibilities for opening short positions. Additionally, the analyst from CryptoQuant commented:

In this situation, we may see the start of an extended trend, potentially offering a beneficial context for altcoins to showcase their strength.

Bitcoin Performance Outlook

Currently, Bitcoin is trading at approximately $93,196, representing a decrease of 3.3% over the past 24 hours. In light of this shift, analysts are examining various insights to understand the current state of Bitcoin.

In the last day alone, the cryptocurrency market has seen a substantial amount of volatility, resulting in approximately 191,493 traders having their positions closed (liquidated), which adds up to around $571.80 million in total liquidations, as reported by CoinGlass.

According to the well-known market intelligence provider, IntoTheBlock, a significant underlying factor could be contributing to Bitcoin’s recent downturn.

Earlier today, a post on X disclosed that high borrowing costs, often indicating overly-leveraged trades, are playing a part in Bitcoin’s persistent price drop.

According to IntoTheBlock, it’s encouraging to note that “funding rates have mostly returned to normal,” suggesting that “the phase of excessive borrowing might be over.

Currently, regarding its technical aspects, there are signs pointing towards a potential reversal for Bitcoin. Notably, well-known crypto expert Ali has shared on his Twitter account that the TD Sequential for Bitcoin now indicates a “buying opportunity.

On the Bitcoin hourly chart, the TD Sequential is showing a buy signal, and a bullish divergence with the RSI is developing. This potential alignment might assist Bitcoin in recovering towards $95,000 – $96,000!

Join me in this trade by signing up to @coinexcom using my referral link .

— Ali (@ali_charts) November 26, 2024

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2024-11-27 07:34