How Much More Loss Can The Bitcoin Market Sustain?

Share This Post

With bitcoin’s price falling, how much more loss can the market sustain and is there more short-term downside?

The below is from a recent edition of the Deep Dive, Bitcoin Magazine’s premium markets newsletter. To be among the first to receive these insights and other on-chain bitcoin market analysis straight to your inbox, subscribe now.

In today’s Daily Dive, we’re covering the state of realized losses and profit in the market and an update to derivatives markets. With bitcoin’s price falling, how much more loss can the market sustain and is there more short-term downside?

Over the last week, we’ve seen a rising level of realized losses on-chain during the latest price drawdown. During bitcoin’s drawdowns over the last six months, realized losses over $1 billion on a 7-day moving average has been a consistent ceiling for each new sell-off.

Back in May, realized losses hit over $2 billion, the highest level in the last five years, which was driven by serious derivatives liquidations.

Source: Glassnode

Yet as a percent of bitcoin’s market cap, the latest round of realized losses and selling are relatively small to market capitulation we’ve seen before.

Source: Glassnode

Historically, the Net Unrealized Profit/Loss Ratio (NUPL) has been a useful indicator to show when the market is in full capitulation and has bottomed. As a refresher, NUPL is calculated as (Market Cap – Realized Cap) / Market Cap. Currently the total market looks to be in a neutral state, but historically we’ve seen every rise in NUPL followed by a major capitulation period. These periods bring the market back to (and even below) the market’s cost basis.

Read Entire Article
spot_img
- Advertisement -spot_img

Related Posts

Ethereum Price Repeats ‘Bullish Megaphone’ Pattern From 2017 – Why $10,000 Is Possible

The Ethereum price has formed a key technical pattern reminiscent of the one observed in 2017 when the cryptocurrency embarked on a major bull rally According to a crypto analyst, this pattern, known

Cardano Price Prediction: Will ADA Hit $2 First or XRP? Former Gains 50%

The post Cardano Price Prediction: Will ADA Hit $2 First or XRP Former Gains 50% appeared first on Coinpedia Fintech News ADA has currently slipped into the red zone, but it is holding strong above

Ripple Legal Chief Offers SEC Advice on Reforming Crypto Rules Under New Leadership

Ripple’s legal chief has unveiled bold strategies for incoming SEC leadership amidst crypto shifts, spotlighting Ripple’s battle-tested blueprint involving XRP Bold Steps Needed: Ripple

Avalanche Price Jumps 62%, AVAX Price Eyes To Hit $65?

The post Avalanche Price Jumps 62%, AVAX Price Eyes To Hit $65 appeared first on Coinpedia Fintech News As the altcoin market maintains its November bull rally, top tokens have added significant

NBA Goes Crypto: LA Clippers Partner With Coinbase In Major Deal

Cryptocurrency exchange Coinbase has revealed that it has struck a sponsorship agreement with a basketball team starting this National Basketball Association (NBA) season Related Reading: Coinbase

Top Analyst Claims XRP New ATH Is Just Around The Corner – Details

The crypto market has been abuzz with activity regarding XRP, and there is a consensus among investors that its anticipated return to all-time high (ATH) territory may occur sooner than anticipated