Bitcoin (BTC) Market Sentiment Weakens Sharply as Entity-Adjusted NUPL Drops

The Entity-Adjusted Net Unrealised Profit/Loss metric exposes the unimpressive state of market sentiment in the Bitcoin market. As per the metric, the BTC market has slipped from a positive outlook to a negative one.

The Entity-Adjusted Net Unrealised Profit/Loss metric points towards a concerning shift in market sentiment within the Bitcoin market. According to the metric, the BTC market has transitioned from a positive outlook to a negative one. Here's what you need to know about the current Bitcoin market sentiment scenario.

Bitcoin’s NUPL Highlights Rising Market Uncertainty

To begin with, let's quickly understand what this NUPL metric entails. It's a simple metric that tracks how much profit or loss Bitcoin holders are currently sitting on.

The Entity-Adjusted NUPL is a variation of this metric, and what makes it unique is that it focuses solely on external economic activity, largely excluding internal transactions.

A Bitcoin Entity-Adjusted NUPL chart, featured by CryptoSlate, shows that the metric has been steadily declining since mid-2024.

From the chart, we can gather that the Bitcoin market sentiment has deteriorated sharply over the last few months.

Bitcoin Entity-Adjusted NUPL Chart: A Closer Look

At the start of 2024, the metric was in positive territory, indicating that the majority of BTC holders at that point were in the green. However, the market scenario has since flipped.

Currently, the metric is hovering very close to loss levels, suggesting that a large proportion of investors are facing the brunt of dwindling profitability.

What's Next For Bitcoin

In the past, the market has encountered several instances of such a scenario, and in most cases, it served as an early signal for an upcoming consolidation phase. We saw it pan out drastically in 2017 and 2021.

In conclusion, the current market sentiment is not painting a fully optimistic picture for the Bitcoin market. The Entity-Adjusted NUPL metric's revelation is bound to create a stir among BTC investors, especially those anticipating a strong bullish momentum in the market this month.

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