Bitcoin (BTC), which is a cryptocurrency, has risen 7% in the past two weeks despite the expectation that US Federal Reserve will maintain interest rates. unchanged The next scheduled meeting is on the 30th of July. Some indicators, however, suggest the market is entering an overheated territory.
Bitcoin Market Entering Overheating Territory?
The Bitcoin Network Value to Transactions (NVT) Golden Cross has been on the increase, according to an article by CryptoQuant Quicktake contributor Burakkesmeci. The upward movement has begun. signal Signs of overheating markets
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Uninitiated users can use the Bitcoin NVT Gold Cross as a technical tool to compare the moving averages between the NVT short and long term in order to detect potential market bottoms or tops. The short-term NVT crossing above the long term average is a sign that Bitcoin may be overvalued, and could face a correction in the near future.
This indicator has predicted local tops in three cases so far for 2025. On February 5, the NVT Golden Cross reached 2.68, while BTC was trading at $97.600. This was followed by a correction of 23.65%.
The indicator reached its peak on March 24 at 2,87. BTC was trading around $87,000. This led to a correction of 16.6%. Most recently – on June 16 – it rose to 2.21 with BTC trading at $106,800, which was followed by a 9.87% price dip.
The NVT Golden Cross is currently at 1,98. It has not yet crossed the crucial 2.2 threshold, but its upward trend suggests that a market overheating is brewing. CryptoQuant explained that:
It is not necessarily bullish, but it does show that momentum is increasing. It may be a sign of a potential local peak if the metric crosses over 2.2. But don’t rush to exit – historically, the metric has stayed above 2.2 for several days.
As a conclusion, burakkesmeci stated that although crossing the 2.2-level might indicate Bitcoin heating up on the short term, it could signal a return bullish trend in the medium-term. The opinions on BTC’s short-term trajectory are largely divided.
Analysts are divided on BTC price action
The NVT Golden Cross suggests that BTC may still have room to rally before hitting a potential local top. Analysts disagree. foresee A short-term drop before Bitcoin hits new highs.
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For instance, noted crypto analyst Chistian Chifoi described BTC is currently trading at a price of. “deceptive setup,” Warning it could trap bulls ahead of a potential surge towards a new All-Time High (ATH) $160,000.
Glassnode is a firm that offers on-chain analytics. forecasts BTC’s peak in the short term is $117,000. BTC is currently trading at $108,204. This represents a 0.1% decrease in 24 hours.
Charts and image are from TradingView.com, CryptoQuant.
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Source: www.newsbtc.com
