Chiliz (CHZ) Price Rebounds 5% After Retesting Weekly Support Around $0.053

Network Realized Profit/Loss metric shows CHZ’s capitulation events on July 5 and July 8. On-chain data shows that CHZ dormant wallets are active and exchange supply is decreasing, signaling bullish outlook.

The Network Realized Profit/Loss metric, which highlights the total profit/loss realized by an entity, can be used to identify market sentiment shifts. Strong spikes in a coin’s NPL indicate that its holders are, on average, selling their bags at a significant profit. On the other hand, strong dips imply that the coin’s holders are, on average, realizing losses, suggesting panic sell-offs and investor capitulation.

In CHZ’s case, the NPL indicator dipped -264,940 and -12.82 million from July 4 to July 5 and -55,664 and -6.09 million from July 8 to July 9, respectively, signaling two capitulation events.

The first event coincided with CHZ’s price dropping to $0.04, while the second occurred as the token’s price recovered to $0.06. Both events suggest that investors panicked and sold at a loss during CHZ’s downturn and began to realize profits as the token rallied.

CryptoSlate recently covered a report by on-chain analytics firm Glassnode, highlighting the Network Realized Profit/Loss metric and its role in identifying market sentiment shifts.

According to Glassnode, the metric can be used to gauge the average realized profit or loss of an entity, whether it’s a miner, exchange or short-term holder, and provides insights into the aggregate realized net profit or loss of an entity’s coin holdings.

The report noted that strong spikes in a coin’s NPL indicate that its holders are, on average, selling their bags at a significant profit. Conversely, strong dips in the NPL metric suggest that the coin’s holders are, on average, realizing losses, which could indicate panic sell-offs and investor capitulation.

The report also pointed out that while the NPL metric can provide valuable information, it’s crucial to consider it within the broader context of market conditions, technical analysis and other relevant factors to make informed trading decisions.🎜

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