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buy bitcoin nvt signal
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NVT: Top and Bottom Indicator Signals Time To Buy Bitcoin

Tony Spilotro by Tony Spilotro
3 years ago
in Bitcoin, Cryptocurrency news
Reading Time: 3 mins read
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Bitcoin’s network to transactions ratio, or NVT for short, is an indicator developed by crypto analyst Willy Woo as a signal for deterring tops and bottoms of Bitcoin cycles.

A tweaked version of the indicator, one that was designed to filter out private transactions, is now signaling that Bitcoin is in a buy zone – an ideal time for buying Bitcoin at the point of greatest potential financial return.

Indicator That Called Bitcoin’s Recent Top Is Now Signaling Buy

Few crypto analysts have contributed to the overall Bitcoin community as much as Willy Woo. Woo has conducted extensive analysis and has even designed his own indicator for spotting the tops and bottoms of Bitcoin cycles, by looking at the network’s total value to transaction ratio.

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The theory is that when Bitcoin’s total network value outpaces the ratio of transactions across the network, the price of the asset has risen past its fair market value, and is due for a correction.

Related Reading | Experts Weigh In On The Future of Bitcoin and Blockchain

The NVT indicator reached its highest peak of the last few years when Bitcoin reached its recent local top of $14,000 – a peak that was higher than even Bitcoin’s $20,000 all-time high.

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However, even though the indicator work like a charm, predicting a nearly 50% fall from that top to under $8,000, Woo says that the indicator has become less reliable due to private transactions clouding the clarity of the results.

I quite like this dynamic ranging NVTS. I did something similar with NVT and quietly updated the chart last month. https://t.co/pYRuLYVNoK

— Willy Woo (@woonomic) October 10, 2019

But another crypto analyst has further honed the helpful top and bottom-calling tool, and created a version of the NVT signal that tracks the signal against a “dynamic” two-year, “long-term range.”

This new version of the indicator shows that Bitcoin’s NVT ratio has reached an ideal buy zone – typically acting as the bottom of a local cycle and providing the greatest financial opportunity in terms of eventual return on investment.

Previous Version Still Accurate, Predicted September Drop to $8,000

At the end of July, almost two full months ahead of the actual drop following the disappointing launch of Bakkt, the NVT signal had predicted that Bitcoin had topped out, and was due for a correction.

Each time the asset’s NVT signal peaked, on average the asset dropped over 50%. Bitcoin’s recent local top was $14,000, and fell just shy of reaching a full 50% retracement. However, the correction may not be over, and a full 50% or greater drop isn’t off the table just yet.

Related Reading | Bitcoin NVT Ratio: Top Predicting Signal Hits Highest Peak, Is a 50% Drop Ahead?

With the regular unfiltered version of the NVT signal being so accurate in calling tops, could this new, modified version of the indicator be even more accurate at calling bottoms – just as it is doing so now?

Featured image from Shutterstock
Tags: bitcoinbitcoin pricecryptoNVTnvt rationvt signalwilly woo
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Tony Spilotro

Tony Spilotro

I'm Tony Spilotro. Behind the pseudonym, I'm a global remote work leader with a decade of award-winning content experience and excellence. Here, I explore my newfound passions pertaining to privacy, finance, economics, politics, cryptography, property rights, and other libertarian-esque views. I am a Bitcoin evangelist, maximalist, and educator whenever I can be, helping to spread its message of freedom from government control, monetary policy mismanagement, and passing the buck - literally – to future generations. My journey from a curious retail crypto investor to a serious Bitcoin advocate, trader, and technical analyst is an unusual one, but life-changing nonetheless and has become less about money and more about a long-overdue revolution. While a firm believer in the laws governing math and science, I am profoundly fascinated by the impact of astrology and astronomy including moon and solar cycles and planetary alignment and their ability to influence and potentially predict markets. It hasn't yet clicked for me as to how to put anything to use, but I consider it my current rabbit hole I can't yet dig out of. My perspective of growing up alongside the internet, the dot com era, the Great Recession, and roots in video games collecting coins and rare items caused Bitcoin to immediately make sense to me. Through all of these lenses, I seek to produce content that is educational and entertaining, and I thank you sincerely for taking the time to read what I have to say. Please follow me on Twitter at @tonyspilotroBTC and feel free to drop me a line if you would like to work together.

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