Bitcoin continued to crash down yesterday, with the coin hitting as low as $21k before rebounding to current values. Has the crypto made the bottom yet?<\/p>\n
Bitcoin NUPL Indicator Assumes Negative Values For First Time Since 2020<\/p>\n
As pointed out by an analyst in a CryptoQuant post, the NUPL metric has declined below zero, which could be a sign that the crypto may be approaching a bottom.<\/p>\n
The Bitcoin \u201cnet unrealized profit and loss\u201d (NUPL) is an indicator that\u2019s defined as the difference between the market cap and the realized cap, divided by the market cap.<\/p>\n
In simpler terms, what this metric tells us is whether the overall market is currently holding an unrealized profit or a loss.<\/p>\n
When the NUPL\u2019s value is greater than zero, it means the investors as a whole are in a state of profit at the moment.<\/p>\n
On the other hand, values of the metric less than zero imply the Bitcoin market as a whole is now holding an unrealized loss.<\/p>\n
Now, here is a chart that shows the trend in the BTC NUPL over the last few years:<\/p>\n\n
The value of the indicator seems to have plunged down recently | Source: CryptoQuant<\/p>\n
As you can see in the above graph, the Bitcoin NUPL has sharply decreased in value over the past couple of days as the price of the crypto has observed a crash.<\/p>\n
The indicator now has a negative value, suggesting that the overall BTC market is now holding some unrealized loss.<\/p>\n
Related Reading |\u00a0Bitcoin Long-Term Holders Realize March 2020-Like Losses As BTC Crashes<\/p>\n
The last time the indicator dropped this low was back in March 2020, following the crash caused by the onset of COVID-19.<\/p>\n
Historically, Bitcoin has approached a bottom whenever the NUPL metric has reached a negative value of around 0.2.<\/p>\n
This is because as the indicator decreases further in value, investors start going deeper into red, and the motive to sell starts dying down.<\/p>\n
Related Reading |\u00a0Bitcoin Weekly RSI Sets Record For Most Oversold In History, What Comes Next?<\/p>\n
While the Bitcoin NUPL has now gone below zero, the metric\u2019s value is still larger than it was during the previous bottoms.<\/p>\n
So, if a similar trend as those past instances follows now as well, then BTC may have room to decline further still before the bottom is in.<\/p>\n
BTC Price<\/p>\n
At the time of writing, Bitcoin\u2019s price floats around $22k, down 33% in the last seven days. Over the past month, the crypto has lost 27% in value.<\/p>\n
The below chart shows the trend in the value of the coin over the last five days.<\/p>\n\n
The price of BTC has crashed down over the last few days | Source: BTCUSD on TradingView
\nFeatured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com<\/p>","protected":false},"excerpt":{"rendered":"
<\/p>\n
Bitcoin continued to crash down yesterday, with the coin hitting as low as $21k before rebounding to current values. Has the crypto made the bottom yet?<\/p>\n
Bitcoin NUPL Indicator Assumes Negative Values For First Time Since 2020<\/p>\n
As pointed out by an analyst in a CryptoQuant post, the NUPL metric has declined below zero, which could be a sign that the crypto may be approaching a bottom.<\/p>\n
The Bitcoin \u201cnet unrealized profit and loss\u201d (NUPL) is an indicator that\u2019s defined as the difference between the market cap and the realized cap, divided by the market cap.<\/p>\n
In simpler terms, what this metric tells us is whether the overall market is currently holding an unrealized profit or a loss.<\/p>\n
When the NUPL\u2019s value is greater than zero, it means the investors as a whole are in a state of profit at the moment.<\/p>\n
On the other hand, values of the metric less than zero imply the Bitcoin market as a whole is now holding an unrealized loss.<\/p>\n
Now, here is a chart that shows the trend in the BTC NUPL over the last few years:<\/p>\n
The value of the indicator seems to have plunged down recently | Source: CryptoQuant<\/p>\n
As you can see in the above graph, the Bitcoin NUPL has sharply decreased in value over the past couple of days as the price of the crypto has observed a crash.<\/p>\n
The indicator now has a negative value, suggesting that the overall BTC market is now holding some unrealized loss.<\/p>\n
Related Reading |\u00a0Bitcoin Long-Term Holders Realize March 2020-Like Losses As BTC Crashes<\/p>\n
The last time the indicator dropped this low was back in March 2020, following the crash caused by the onset of COVID-19.<\/p>\n
Historically, Bitcoin has approached a bottom whenever the NUPL metric has reached a negative value of around 0.2.<\/p>\n
This is because as the indicator decreases further in value, investors start going deeper into red, and the motive to sell starts dying down.<\/p>\n
Related Reading |\u00a0Bitcoin Weekly RSI Sets Record For Most Oversold In History, What Comes Next?<\/p>\n
While the Bitcoin NUPL has now gone below zero, the metric\u2019s value is still larger than it was during the previous bottoms.<\/p>\n
So, if a similar trend as those past instances follows now as well, then BTC may have room to decline further still before the bottom is in.<\/p>\n
BTC Price<\/p>\n
At the time of writing, Bitcoin\u2019s price floats around $22k, down 33% in the last seven days. Over the past month, the crypto has lost 27% in value.<\/p>\n
The below chart shows the trend in the value of the coin over the last five days.<\/p>\n
The price of BTC has crashed down over the last few days | Source: BTCUSD on TradingView
\nFeatured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com<\/p>\n
<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"colormag_page_layout":"default_layout","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[82],"tags":[],"class_list":["post-1182","post","type-post","status-publish","format-standard","hentry","category-blockchain"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/posts\/1182","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/comments?post=1182"}],"version-history":[{"count":0,"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/posts\/1182\/revisions"}],"wp:attachment":[{"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/media?parent=1182"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/categories?post=1182"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/tags?post=1182"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}