The Glassnode chain analysis company has revealed an Ethereum indicator which reliably reported the price of the bottom before the recent gathering.
Ethereum Nuppl fell into the capitulation zone earlier
In a new article on X, Glassnode spoke of an Ethereum indicator of its joint relationship with Cryptocurrency Exchange Coinbase. The metric in question is the “net profit / loss”, which measures, as its name suggests, the net amount of profit or loss that the investors of the asset as a whole currently hold.
The metric works through the transaction history of each part on the network to see at what price it was moved for the last time. If this previous transfer value was higher than the current cash price of any token, this particular token is supposed to be in a state of net loss not made.
Likewise, a part with a cost base lower than the last price is considered to be profitable. The NUPL sums up the degree of profit / loss involved in both cases and calculates the difference between them.
When the value of the indicator is positive, this means that investors as a whole are seated in a state of net profit not made. On the other hand, it is under the zero brand implies the domination of loss on the market.
Now here is the graph shared by the analysis firm that shows the trend of Bitcoin Nupl in recent years:
As is visible in the graph above, the Ethereum Nupl observed a significant drop earlier in the year when the price of the asset has dropped. In this dive, the indicator came down to around -0.2, which suggests that investors have plunged into a net loss state.
Not only is that, the level of relative loss unrealized on the network was remarkable enough for the feeling to be reported as “capitulation” under the Glassnod methodology.
Often, cryptocurrency markets move in the direction that the crowd is waiting for the least, so that the presence of a high quantity of loss can cause a background. From the table, this seems to be what happened when the NUPL fell into the capitulation zone.
With the overvoltage of prices that has followed from this bottom, the feeling of Ethereum investors naturally marked an improvement. The NUPL may be to keep an eye on it, because once the balance moves massively towards profit, another change on the market could become likely: it has a downward trend.
Ethn price
Ethereum broke away from Bitcoin because its price jumped more than 20% in last week, reaching the level of $ 3,600.
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