Bitcoin NUL Suggests More Downside To Come Before The Bottom

Keshav Verma

1 year ago

3 mins read

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On-chain data shows the Bitcoin NUL indicator is still below a value of 0.5, a sign that more downtrend could be in store for the crypto before the bottom is in.

Bitcoin Net Unrealized Loss Surges Up, But Still Remains Below 0.5

As pointed out by an analyst in a CryptoQuant post, the cryptocurrency’s price may still be nowhere near a bottom.

The relevant indicator here is the “net unrealized loss” (or NUL in brief), which tells us about the total number of coins that are currently holding an unrealized loss.

The metric works by comparing the last selling price of each coin on the chain to the current value of Bitcoin. If the previous previous of any coin was more than the current one, then that coin is holding a loss right now.

On the other hand, the current price being more than the last selling value would imply that the coin is in profit at the moment.

Related Reading | Bitcoin Falls Below $30k As 10k BTC Flow Into Gemini

The NUL metric only takes into account the former type of coins. Another indicator, the net unrealized profit (NUP), measures the latter category.

Now, here is a chart that shows the trend in the Bitcoin NUL over the history of the coin:

The value of the indicator seems to have been rising recently | Source: CryptoQuant

In the above graph, the quant has marked the two different zones of the Bitcoin NUL, with the metric value equal to 0.5 line being the divider between them.

It looks like historically, the price of the crypto has tended to observe the major bottoms when the indicator’s value has been greater than 0.5

As you can see in the chart, the NUL metric has observed some uptrend in recent months. This is because the value of Bitcoin has been declining during this period, leading to more coins going underwater.

However, despite this recent rise, it seems like the net unrealized loss’ current value is still well below the 0.5 level.

If past trend is anything to go by, Bitcoin may observe further downtrend in the coming future before the NUL’s value exceeds the threshold and a bottom is formed.

BTC Price

At the time of writing, Bitcoin’s price floats around $29.7k, up 3% in the last seven days. Over the past month, the crypto has lost 23% in value.

The below chart shows the trend in the price of the coin over the last five days.

Looks like the value of the crypto has gone down over the last couple of days | Source: BTCUSD on TradingView

Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com

Keshav Verma

Keshav is currently a senior writer at NewsBTC and has been attached to the website since June 14, 2021.

Keshav has been writing for many years, first as a hobbyist and later as a freelancer. He has experience working in a variety of niches, even fiction at one point, but the cryptocurrency industry has been the longest he has been attached to.

In terms of official educational qualifications, Keshav holds a bachelor’s degree in Physics from one of the premier institutes of India, the University of Delhi (DU). He started the degree with an aim of eventually making a career in Physics, but the onset of COVID led to a shift in plans. The virus meant that the college classes had to be delivered in the online-mode and with it came free time for him to explore other passions.

Initially only seeking to make some beer money, Keshav unexpectedly landed clients offering real projects, after which there was no looking back. Writing was something he had always enjoyed and to be able to do it for a living was like a dream come true.

Keshav completed his Physics degree in 2022 and has been focusing on his writing career since, but that doesn’t mean his passion for Physics has ended. He eventually plans to re-enter university to obtain a masters degree in the same field, but perhaps only to satiate his own interest rather than for using it as a means to find employment..

Keshav has found blockchain and its concepts fascinating ever since he started going down the rabbit-hole back in 2020. On-chain analysis in particular has been something he likes to research more about, which is why his NewsBTC pieces tend to involve it in some form.

Being of the science background, Keshav likes if concepts are clear and consistent, so he generally explains the indicators he talks about in a bit of detail so that the readers can perhaps come out having understood and learnt something new.

As for hobbies, Keshav is super into football, anime, and videogames. He enjoys football not only as a watcher, but also as a player. For games, Keshav generally tends towards enjoying singleplayer adventures, with EA FC (formerly FIFA) being the only online game he is active in. Though, perhaps due to being ultra-focused on the game, he is today a semi-pro on the EA FC scene, regularly participating in tournaments and sometimes even taking back prize money.

Because of his enthusiasm for anime and games, he also self-learned Japanese along the way to consume some of the untranslated gems out there. The skill didn’t merely remain as just a hobby, either, as he put it to productive use during his exploration for small-time gigs at the start of COVID, fulfilling a couple of Japanese-to-English translation jobs.

Keshav is also big into fitness, with agility and acceleration-related workouts making a big part of his program due to the relevance they have in football. On top of that, he also has a more traditional strength based program for the gym, which he does to maintain an overall fitness level of his body.

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