Bitcoin is currently still trading below $57k at press time and trading metrics have started to pile up in favour of an upwards move. One of them warrants so much bullish action that it terms the current price levels “cheap”.
Bitcoin has recently posted new monthly lows as the digital currency came down sharply from its all time highs of around $69k. While metric after metric suggests that the digital currency is in for a short-term price rebound, any price increase has still remained largely elusive.
The latest of such indicators to turn positively green is the bullish Advanced NVT signal. While the signal’s name is fancy, it uses a simple way of using the network’s market capitalization and transaction volume to determine whether it is oversold or overbought. It is a measure of investing habits in the network. It is calculated by dividing the total market capitalization of the digital asset by its 90-day moving average.
According to a Tweet from Philip Swift, the creator of the trading metric on the microblogging platform:
Advanced NVT (blue line) has now dropped deep into oversold territory (green bands).#Bitcoin is looking seriously cheap relative to network activity here on high time frames. Expecting a strong reaction in the not too distant future.
— Philip Swift (@PositiveCrypto) November 24, 2021
Other trading indicators are also flashing heavily green in the short-term and a strong reaction from the cryptocurrency can be expected. The Bitcoin greed index is back from above greed to as low as fear recently showing that the selling pressure on it has ended. The much-relied Relative Strength Index (RSI) levels are also hinting on a price increase in the near future. On-chain analytics also show the same results and the crypto is judged to have the lowest number Bitcoin possession by short-term traders in three years which is something to say the least.
But, there are some reasons why the digital currency isn’t exactly recovering strongly despite indicator after indicator showing that it is going to. The biggest one of them is that the Mt. Gox affectees are close to getting their compensations. That is around 141,000 BTC that traders fear will enter the market directly and overflood the supply. Mt. Gox was a crypto exchange that suffered a massive hack back in 2011 and resulted in the stealing of more than $500 million worth plus in Bitcoin from the system.
Image Source: pixabay.com
Don’t worry, we hate spam too
one weekly digest, just the important stuff.