Bitcoin On-Chain: Percentage Of Supply In Profit/Loss

Hey everyone and thanks for jumping back Into the cryptiverse today we're going To talk about Bitcoin and we're going to Be discussing the supply in profit or Loss so of course we are putting back on Our on-chain analysis hat if you guys Like the content make sure you subscribe To the channel give the video a thumbs Up and again check out into the Cryptiverse premium at into the we are relaunching the Sale for a holiday sale so if you didn't Get it in November and you want to sign Up you could do so now through the end Of the year so make sure you check it Out link is in the description below or The pinned comment we have plenty of Different tiers that you can that you Can sign up for now this is actually one Of my favorite indicators the the Bitcoin percentage of supply and profit And loss and one of the reasons I like It is because of how Easy it is to understand right you look At the chart and you can see this Cyclical behavior of Bitcoin right it it Doesn't take much effort to really see How it Ebbs and flows right how the Market cycles of Bitcoin ebb and flow And in the same way in the peak Mania Phase it can often feel like the price Will never go down in a bear Market it Can also feel like the price will never Go up right

And so we must constantly be careful About about getting too comfortable with Any One path especially when you're on That path for a long period of time but If you look at this chart what you'll Notice let me explain it a little bit The the line here at the top is the Percentage of Supply in profit for Bitcoin so when it's pressing to new Highs of course you you basically have 100 in profit because of course anyone Who's bought Bitcoin at that point would Be in profit but it when you come down From those recent highs of course you'll See it come down and when you get into Those deeper bear markets the percentage Of of supply and profit comes down quite A bit In the same way the percentage of supply And loss goes up a lot in Bear markets Okay so one of the things that is useful To to really understand here is that the Market cycle bottoms come once these two Indicators cross right after they cross Furthermore we could apply moving Averages and figure out you know how Long does it take for them to cross Remember moving averages are lagging Indicators I mean it's basically in the Definition if you're taking a a Long-term moving average of something It's going to take a certain amount of Days for that to be reflected in that Moving average even after that price of

The asset makes a specific move But when you look at it like this it can Be hard to really discern what's Actually going on uh you know in in this Time frame so what I've previously done Is we just take A moving average like a 30-day moving Average a 30-day simple moving average And what you notice with this And we've talked about this many times Before is that the major bottoms for Bitcoin have occurred after these two Metrics crossed right so let's break it Down don't take my word for it right we Always have to verify as they say right Don't trust verify if you look back over Here in 2011 you'll notice that they Crossed October 11 or October 21st or so Maybe October 22nd but we didn't Actually see a major bottom on The Daily Time frame until November so what do you Notice it was after these metrics Crossed right after they crossed and We're still crossed and had not crossed Back yet that you actually found a Market cycle bottom they were actually Right on the on the cusp of Crossing Back up to the downside when we actually Got that bottom If you continue on to 2015 you'll notice That they briefly crossed right here in October but it was sort of like a fake Out right and then they they went back Down for a little bit kind of flirted

For a while but you didn't see any real Commitment until December about two Months later what do you know about that Bear Market if you remember that bear Market did not end until January 14th of 2015. so I will remind you the bear Market started in November of of 2013 Really the very end of November depends On where you take the Wix right if you Take the hourly Wick or you care about The daily closes whatever but it Basically started in in November the the Bottom was not until January so the the Bear Market actually lasted about 14 Months okay it lasted the last month or So of 24 2013 all of 2014 and a couple Weeks into 2015. but what you'll notice Yet again Is that this Market cycle bottom did not Occur until after they had a meaningful Cross and it stayed that way right I Mean it wasn't just sort of like a very Brief cross where it then crossed back Down Showed real commitment to the cross And then we got a bottom And you go out to 2018. you see the same Thing right there wasn't really a a Struggle to see the cross right it just It it crossed in December but December 6th or 7th of 2018 Market cycle bottom Occurred you know December 17th I I Believe it was you know the 15th 16th 17th somewhere in that time frame

Depends on if you care about daily Closes or hourly Wicks whatever but Again it occurred after They crossed So then we talked about this before this Is one of the bottoming indicators if You guys have watched the series that I Put out occasionally called you know Bitcoin the Bulls versus the Bears and We go through and tally up all the Different indicators this is one that is Really you know it has been holding out Right and it had not yet triggered and And so we'll provide an update for it Right now Where is it What you'll notice is that they briefly Crossed for like one day One day In December 7th of 2022 right you can See they basically crossed for that one Day and then they they Came back down that's not that Dissimilar from what we saw back in 2014. in October Which was also A double Peak cycle that started and the Bear Market started in November and it Went through January right November of 2013 to January 5th 2015 and again you Saw sort of like a very brief cross then We actually finally got it a couple Months later between that time though Bitcoin had a sizable pump actually I

Mean if you if you actually take a look The price went from like 324 dollars all The way up to 421 dollars now that might Not sound like a lot but that's actually Quite a move you know I mean uh it's Like a 10 move would only be like a 32 Dollars to the upside which would have Gotten it you know like 356 or so so You're talking about a fairly sizable Move to go from 324 so all the way up to 4 421. the problem is that it still was Not the bottom right that it still was Not the bottom despite that move to the Upside and despite the fact that they Had temporarily crossed we actually had Not put in a new low you can see the low Here was in October of 2014 at around 322 and then this one was at 324 so During that initial cross we didn't even See a new low then later we actually did See a cross of the supply and profit and Loss and we got our Major Market cycle Bottom Not that dissimilar from you know what's Happened recently right you have a cross But we haven't actually seen a new low The the price the lowest the Bitcoin Went during this very brief period here On the daily time frame of course was Just 16.85 K we're actually lower than That price right now And if you look at it if you look Closely at the 30-day SMA it's actually Slowly starting to curl back up it's not

Curling up yet but you can see the rate Of change right like the the angle of Attack Um is is starting to come back up a Little bit it's leveling it's trying to Level out and one of the reasons for That Is just simply because the people who Bought Bitcoin you know recently at like 18K when it went up to 18K and everyone YOLO back in right to every bear Market Rally in the bear Market What happened now all these people are Now sitting at a loss right they're all Now sitting at a loss and so you know That contributes and so if if Bitcoin Keeps doing this right then more and More people will be sitting at a loss if Every time we have these bear Market Rallies we then just simply come right Back down so Interesting observation right and and Again Every bear Market is going to be Different and I don't want us to pretend Like they're going to be the same we're Using the context of History to show us What can happen not to show us what will Happen I've I've found oftentimes if we Don't understand what has happened in The past then we are simply unable to to Plan for a potential repeat of that same Scenario doesn't have to play out the Exact same way but it doesn't mean you

Shouldn't plan for it right it doesn't Mean you shouldn't play for it it's the Same thing with the last bear Market in 2018 You know Bitcoin put in a major low in June and then it put in higher lows Until November or mid-november than the Four foul and we talked about that right We said look June's probably not the Bottom it's probably doing the same Exact thing it did in 2018 and we're Going to see a move down in November and Sure enough we gotta move down in November in the same way and you know I Know people like to call it a Black Swan But the reality is is it's just a bear Market right it's just a bear market and Bear Market things happen in Bear Markets right because asset prices go Down in this in this situation the FED They're raising interest rates they're Exposing the fraud they're exposing the Zombie companies again it's just an Artifact of a bear Market you can always Look for reasons to to sort of you know Try to try to assess why it happened but The reality of the situation is just Simply a bear market and in Bear markets The price generally goes down right you Don't have to you don't have to come up With a narrative for every every single Thing But this first cross over here October second one December bottom was

In January right so it was October December January Today First cross December right it was Actually December now if you were to go Two months out from that it would Actually put you in uh in February and Then the market cycle bottom based on That recent pattern would actually be in March so again I'm not saying it has to Play out like that by any stretch of the Imagination but with that said Would it be foolish not to not to Potentially plan for such a scenario I Think it probably would therefore Probably makes sense to at least plan For it and be on the lookout for it Another way to visualize this by the way Is to look at a 50-day SMA and the Reason why I say that is because yet Again it it almost always occurred Before the bottom okay even a 50-day SMA You might say well why does he care so Much about these long-term moving Averages the reason why and we've talked About this a few times is this the Time-based capitulation of Bitcoin is is Probably more important than the price Based capitulation right If Bitcoin were to drop to the market Cycle bottom tomorrow and then we just Went up from there it'd be easy right It'd be smooth sailing from that point You know I mean we might get scared a

Few times by Price drops but if we saw Some type of major capitulation that Wiped everyone out then you that's what Usually what a lot of longer term crypto Investors look for we got in 2014 we got In 2018. We've sort of had it somewhat in 2022 But it's just been a very slow step down No major like 50 capitulation here at The end of the year not not yet anyways And so if you look at the 50-day SMA What you'll notice is that again in 2011 Cross bottom came later 2015 across of the 50-day SMA right Very brief cross here and then it Committed to it later on once it was Actually committed and over it and Stayed that way we got the market cycle Bottom the only one that's not but it Came relatively close if you look at 2018 the actual cross occurred like on The day of the market cycle bottom or Maybe a day after I can't remember it Looks like I mean it literally looks Like it's like like one day later I mean This this price here was and again this Is these are daily closes So it might even be might be worthwhile To go see where the actual bottom was so Let me let me actually go back to the Daily time frame and go back to all the Way back to 2018 And let's find The wick so it was December 15th the the

Day that had the lowest Wick and I guess Lowest daily close as well so December 15th going back over to the supply and Profit and loss this was December 15th Okay so they crossed one day later so it Would have missed it by one day Okay but the point is that every single Time They eventually crossed right which Would have really represented a you know A pretty sizable move to the downside And a lot of investors still feeling Pain every single cycle right this was Very brief a longer cross over here Pretty long cross over here Right now they're still pretty far apart Right so if you take the 50-day SMA the Supply and profit is 52.49 percent The supply and loss is 47.51 this again Is the 50-day SMA not the instantaneous And if you look at it and you zoom in They are actually converging now okay You can see that they're starting to Converge one way that I like to look at This and you can kind of see that while I you know while I still think it is it Is unfortunately a bear market right it Just is what it is Um you can see the Bears are losing Steam right I mean you know each new leg Down like so the first major like down Bears had a ton of momentum second one Still a good bit of momentum third one

Some momentum right fourth the momentum Is really starting to slow down so the Bears are slowly losing momentum as we Get deeper and deeper into the bear Market But that's not dissimilar from what We've seen in the past right you know Those those first leg Downs major Momentum they lose momentum as we get Further down and then eventually the Bulls sort of offset the Bears we get Into that long accumulation phase as you Can see right here and then we build out For the next cycle again same thing over Here right we get into this accumulation Phase we build out for the next cycle So far we haven't really seen that cross And I know it's difficult right I Understand the time-based capitulation Component is so difficult and so hard And it makes you get apathetic and it Makes you you know think all sorts of Things related to crypto and whatnot but Despite everything right despite Everything that crypto has gone through This year you know not only with you Know things with Celsius and FTX and Luna and all of that stuff right and and Block fi even more recently and all the Fun going on today despite and even a Recession potentially coming up right Despite all of that so far This is not that dissimilar from what We've seen every single bear market

Right it's not it's not and you know it Doesn't mean that it won't diverge at Some point I'm sure it probably will But we have to remind ourselves that you Know as bad as it feels right now it Still has not deviated from what we've Seen in Prior Bitcoin bear markets in Fact up until this point this bear Market hasn't even been as bad as some Of the other bear markets and it's not We can't it's not even because we Haven't had enough time this bear Market Has been going on for 13 months right The the 2018 bear Market only lasts like 12 months now the 2014 one lasts about 14 months and so we we understand that You know it could still be a little bit More time but I'm saying you know look To some of these longer term moving Averages of the supply and profit and Loss and when you see them Crossing Assuming they do cross eventually that Historically is the accumulation phase For the next bull market okay Um and this is why you know this is why I've been pretty adamant this year Cash is King right I mean like we can Talk about you know I mean I know people Like to talk about all coins and you Know what all coin gems exist and all That sort of stuff but guys in a bear Market it's just it's noise it's Irrelevant it's all just hoping them to Get you to get to you know buy back hand

So the market sucks in more liquidity Before taking another leg lower and and I'm telling you You know while while we are getting Further into the bear Market we are Getting a bit deeper you can see that This accumulation phase of seeing these Two moving averages at the time profit Loss cross normally they Mark the Accumulation phase for Bitcoin before The next bull market We are getting relatively close Um and on the 30 day they actually did Briefly cross like in 20 like in 2014 But we haven't really seen a major cross Of these two moving averages not just Yet right not just yet another way to Visualize this actually is to take the Moving average out and only look at the Supply and loss and you can kind of see I mean you can see where where this one Came up back in in 2011 uh we still Haven't gotten to that level yet but if You look at at 20 you know 2014 2015 and If you look at 2018 and early 2019 You'll see that you know you can kind of See just how high up the supply and lost God and and then you can see where we Are today right so if I were to just Sort of hover here of where where we Currently the the current high is on This and you can sort of see the line go Across the page you'll see where we are In the context of every prior bear

Market and you'll notice it in every Prior bear Market the supply and loss Actually went a bit higher than it is Today doesn't necessarily mean anything Has to happen I'm just you know making This observation and you can do without What you will but I think this indicator Is pretty interesting what do you think Of it let me know in the comments below Do you think the cross do you think they Won't uh yet again and again we do have The um we are running that holiday sale On into the crypto versus premium again We have several different tiers one of Them is even free so again check that Out in the description below and the pin Comment thank you guys for tuning in Make sure you subscribe if you're not Subscribed give the video thumbs up and I'll see you guys next time bye


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