NUPL Shows Signs of Bearish Trend- Bitcoin (BTC) On Chain Analysis

[Pagla]

BeInCrypto takes a look at on-chain indicators for Bitcoin (BTC), more specifically the Market Value To Realized Value (MVRV) and Net Unrealized Profit Loss (NUPL)

MVRV Z-score
MVRV is defined as the ratio between the market and realized capitalization levels. Values higher than one specify that the market cap is larger than the realized cap.  The MVRV Z-score uses a standard deviation in order to normalize the values.

On Jan 24, the indicator reached a value of 0.85. The low is the first time that the indicator has fallen inside the 0.80 -1.20 range since Sept 2020, when the current bullish cycle was just beginning. Historically, values above this area have been associated with bullish trends, while those below have transpired during bear markets.

Therefore, in order for the cycle to remain intact, MVRV has to bounce and move outside of this area. A breakdown below 0.8 would confirm that the long-term trend has turned bearish.

More Information