Investor profit loss refers to the aggregate financial gain or deficit experienced by market participants holding a specific digital asset. This metric assesses the overall profitability of the investor base. It is typically calculated by comparing the current market price to the price at which assets were last moved on-chain. Understanding this provides insight into prevailing market sentiment and potential selling pressure.
Context
On-chain analytics frequently monitors investor profit loss to gauge overall market health and identify potential support or resistance levels. When a large portion of investors are in profit, it might indicate increased selling pressure as they realize gains. Conversely, widespread losses can signal capitulation or a potential market bottom.
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