Crypto analyst Joao Wedson said a critical on-chain indicator needs to be closely watched for the start of a new Bitcoin bull market.
According to Wedson, the signal for the next strong bullish wave will come when the recognized net profit/loss measure for long-term investors (NUPL) turns negative.
According to data shared by Wedson, the NUPL (Number of Earners) value for long-term investors is currently 0.36. This ratio indicates that the most resilient group of investors in the market are still, on average, holding unrealized profits. The NUPL metric measures whether investors are holding their Bitcoins at a profit or loss relative to their cost. The situation of long-term investors, in particular, is considered a vital indicator for understanding the current stage of market cycles.
According to the analyst, the real strong signal will come when this indicator moves into negative territory. A scenario in which even long-term investors suffer unrealized losses historically indicates a phase of “maximum depression” in the markets. These periods are typically characterized by sellers exhausting themselves, moving Bitcoin from weak to strong hands, and laying the foundation for a new market cycle.
Wedson argued that in previous cycles, the NUPL for long-term investors moving into negative territory represented the last step before the start of a new bull market.
*This does not constitute investment advice.
