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On-chain data shows the Bitcoin Network Value to Transactions (NVT) Golden Cross has plummeted recently. Here’s what this could mean for BTC’s price. Bitcoin NVT Golden Cross Has Plunged Into Bottom Zone Recently As explained by an analyst in a CryptoQuant Quicktake post, the BTC NVT Golden Cross has declined to the lowest level in two months recently. The “NVT Ratio” refers to an indicator that keeps track of the ratio between the Bitcoin market cap and transaction volume. When the value of this metric is high, it means the value of the network (that is, the market cap) is high compared to its ability to transact coins (the transaction volume). Such a trend implies the asset may be overvalued. Related Reading: Bitcoin Capital Inflows See Notable Slowdown, But Is This A Worry? On the other hand, the indicator being low suggests the cryptocurrency could be due to a bullish rebound as its volume is high compared to its market cap. In the context of the current topic, the normal version of the NVT Ratio isn’t of interest, but rather a modified form known as the NVT Golden Cross. This metric compares the short-term trend of the NVT Ratio with its long-term one to determine whether its value is near a top or bottom. The NVT Golden Cross uses the 10-day moving average (MA) of the NVT Ratio to track short-term trends and the 30-day MA for long-term ones. Now, here is a chart that shows the trend in the Bitcoin NVT Golden Cross over the last couple of months: In the graph, the quant has highlighted two zones that have historically proven to be relevant to the Bitcoin NVT Golden Cross. The red zone, situated above a value of 2.2, is where the indicator has been the most likely to see a reversion to the mean zero level. Similarly, the green zone corresponding to values under -1.6 is where bottoms in the metric have tended to form. As the color coding already implies, ventures into these zones have often meant a bullish and bearish outcome for BTC, respectively. From the chart, it’s apparent that the NVT Golden Cross surged into the overheated territory around the time of last month’s price top. Since then, the indicator has gradually been making its way down, with its value today finding itself submerged in the undervalued region. Related Reading: Arbitrum (ARB) Primed For 46% Rally If This Happens, Analyst Reveals The current value of -2.21 is the lowest that the metric has been in around 60 days. Given the historical pattern, it’s possible that this could imply Bitcoin may be near a local bottom, if one isn’t already in. BTC Price Bitcoin has settled into a phase of sideways movement during the last few days as its price is still trading around the $105,200 mark. Featured image from iStock.com, CryptoQuant.com, chart from TradingView.com