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Bitcoin NUPL metric is above the 365-day average: Bulls are gaining strength again.
Bitcoin NUPL metric is above the 365-day average: Bulls are gaining strength again. During a bull rally, I try to seize buying opportunities by following the 365-day simple moving averages of on-chain metrics. 1- What is NUPL? Net Unrealized Profit and Loss (NUPL) is the difference between market cap and realized cap divided by market cap. A score above 0 indicates that investors are in profit. Additionally, our cold blue color (below 0) may indicate that the Bitcoin price is periodically suitable for investment. On the other hand, dark orange or red shows that investors' profits have significantly increased. This may indicate that we are approaching the end of the bull rally. 2- SMA 365 The 365-day average is the most basic trend-following tool (in my opinion). I add SMA 365 to on-chain metrics like NUPL. This way, if NUPL is above its 365-day simple moving average, we are in a bull rally, and if it's below, we are in a bear period (of course, this alone is not sufficient). This method can be useful for forming a basic idea. ✅Conclusion By following NUPL and its 365-day moving average, I can track the trend. In this way, whenever the NUPL data approaches SMA 365 during bull rallies, I consider it a buying opportunity. Conversely, during bear rallies, if the NUPL data approaches SMA 365, I see it as a selling opportunity. Of course, the main thing here is to understand which trend we are in. Bear or bull? We can easily grasp this by following macroeconomic data. Thank you for reading