Riding the investor cycle: In-depth analysis of market losses and emotions
In the investment wave, how to accurately grasp the subtle changes in investor sentiment and market dynamics? This section focuses on loss-making holdings and trading tokens, and reveals the secrets behind them through core indicators such as MVRV and SOPR.
Although the unrealized losses of new investors seem heavy, compared with historical sell-offs, their proportion of STH market value is still moderate, similar to the bull market adjustment period. However, in-depth analysis found that realized losses far exceed unrealized losses, and the market may have shown signs of moderate overreaction.
Comparing cumulative losses with losses locked in tokens, the difference between the two is thought-provoking. At cyclical price lows, STH's realized and unrealized losses often soared to 10% to 60% of total holdings. The current level is still mild compared to the historical bottom, and is quite similar to the 2016-2017 cycle. The relative indicators are all below the 10% warning line.
This finding means that despite the sharp market fluctuations, the actual damage to investor sentiment may not be as serious as it seems. In the journey of navigating the investor cycle, understanding and making good use of these key data will be your compass for steady navigation.
