Bitcoin (BTC) has seen a 7% increase over the past fortnight, demonstrating robustness in the face of assumptions that the US Federal Reserve will maintain interest rates at their current levels in their approaching July 30 meeting. Nevertheless, some signs indicate that the market might be moving towards a state of overheat.
As burakkesmeci, a contributor to CryptoQuant Quicktake, recently revealed, the Bitcoin Network Value to Transaction (NVT) Golden Cross is exhibiting an upward trend. Crucially, this ascension is beginning to indicate potential market overheating.
The Bitcoin NVT Golden Cross is a technical tool that compares the short-term and long-term moving averages of the NVT ratio to pinpoint possible market peaks or troughs. When the short-term NVT surpasses the long-term average, it frequently indicates that Bitcoin is becoming overly valued and could be on the brink of a brief downturn.
This indicator has accurately forecasted three local peaks in 2025 to date. The first instance was on February 5, when the NVT Golden Cross reached 2.68 with BTC trading at $97,600, which was succeeded by a 23.65% downturn. On March 24, the marker topped at 2.87 with BTC around $87,500, resulting in a subsequent correction of 16.06%. Most recently, on June 16, it climbed to 2.21 with BTC exchanging hands at $106,800, followed by a 9.87% price reduction.
The NVT Golden Cross is currently at 1.98. Although it hasn’t yet surpassed the critical 2.2 threshold, its upward movement suggests that market overheating may be on the horizon. The CryptoQuant analyst elaborated:
“Breaking its previous high is moderately bullish and shows momentum is building. If the metric crosses 2.2 again, it may hint at a local top. But don’t rush to exit – historically, the metric has stayed above 2.2 for several days.”
In conclusion, burakkesmeci noted that while crossing the 2.2 level might suggest Bitcoin is heating up in the short-term, it could also signal a return of bullish momentum in the medium-term. That said, the opinion on BTC’s short-term price trajectory is largely divided.
The NVT Golden Cross suggests that BTC may still have room to rally before hitting a potential local top. However, some analysts foresee a short-term pullback before Bitcoin reaches new highs. For instance, noted crypto analyst Chistian Chifoi described the current BTC price action as a “deceptive setup,” warning it may trap bulls before a possible surge toward a new all-time high (ATH) of $160,000. Meanwhile, on-chain analytics firm Glassnode forecasts BTC’s short-term peak at $117,000. At press time, BTC trades at $108,204, down 0.1% in the past 24 hours.
