Key Takeaways
- The Net Unrealized Profit/Loss (NUPL) indicator has generated bearish divergence.
- The Long-Term Holder NUPL has generated a similar divergence, adding to the worries.
- What happened the last time these NUPL readings occurred, and what do they say about the current cycle?
Bitcoin’s Net Unrealized Profit/Loss (NUPL) indicator is flashing troubling signs that echo past market cycle tops.
The standard and Long-Term Holder versions of the metric show bearish divergences, historically linked to major reversals.
These readings raise serious questions about whether the current bull run is nearing exhaustion.
Bitcoin’s NUPL Divergence
The NUPL is an on-chain indicator that shows if the market is in a state of profit or loss.
It is created by dividing unrealized profits by unrealized losses.
A negative indicator reading suggests the market is at a loss, while a positive reading means the opposite.
In simple terms, the indicator shows whether Bitcoin’s circulating supply is profitable.
The NUPL indicator has historically been used to predict market cycle tops and bottoms.
The market cycle top has occurred at a value above 0.75, though this did not happen in 2021.
Another way to determine the market cycle top is to determine when there is a bearish divergence in the NUPL.
This method has predicted the last three cycle tops, even if the indicator did not cross 0.75 before doing so.
In that sense, the current NUPL reading is extremely worrisome, since the indicator has generated a double bearish divergence (orange).
What About Long-Term Holders?
The Long-Term Holder (LTH) NUPL is created the same way; however, it only takes into account Unspent Transaction Outputs (UTXO) of at least 155 days.
So, while its method of creation and reading are the same, the LTH-NUPL only focuses on long-term holders, who are usually better at predicting cycle tops than short-term holders.
The LTH-NUPL chart is cleaner than its regular counterpart. Every cycle top has been reached above 0.75, and almost every one had a bearish divergence.
- BTC LTH NUPL | Credit: Valdrin Tahiri/Glassnode
This is worrisome, since the LTH-NUPL crossed 0.75 in January 2025 and has generated a bearish divergence.
So, the indicator shows bearish signals that previously marked the cycle top, raising red flags about the sustainability of this one.
Conflicting On-Chain Readings
The NUPL readings conflict with mining indicators, which suggest a significant rally is coming.
On the contrary, the regular and LTH-NUPL suggest that the cycle top is close.
The conflicting on-chain indicators further illustrate how different this Bitcoin cycle has been from previous ones, which were straightforward and characterized by more straightforward top signals.
The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
Valdrin Tahiri is a cryptocurrency analyst and reporter at CCN, specializing in technical analysis with a focus on Elliott Wave theory, on-chain metrics, and fundamental research. He brings over seven years of experience in the crypto space as both a trader and writer.
He discovered cryptocurrencies in 2017 while earning his MSc in Financial Markets at the Barcelona School of Economics, which sparked a deep interest in blockchain and market dynamics. Since then, he’s contributed to top crypto outlets like BeInCrypto and CoinGape.
Valdrin also served as Community Manager of BeInCrypto’s Telegram group for three years, helping grow it into one of the largest crypto communities worldwide. His expertise in market structure and price patterns allows him to break down complex trends into clear, actionable insights.
He’s published thousands of articles covering altcoins, Bitcoin cycles, and macro trends.
