Tuesday, June 11, 2024

🕞 The Best Time to Buy (and Sell) Your Crypto

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The Best Time to Buy (and Sell) Your Crypto

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Editor's Note: Right now, there are three cryptocurrencies Robert believes could be bigger than Bitcoin. One possesses lightning-fast technology and has already amassed some 29.7 million users. Another offers its users the chance to collect up to 35% yields on their savings. You can find out about all three - and why Robert thinks they're poised for greatness - by clicking here.


Robert Ross

Robert Ross
Speculative Assets Specialist

I'm going to let you in on a little secret...

Part of my early success in the crypto market was simply being in the right place at the right time.

When I first bought Bitcoin (BTC), Ethereum (ETH) and other altcoins in 2017, I didn't have much of a plan.

I knew that we were watching the birth of a new asset class that Wall Street was still ignoring. However, I didn't have much of a strategy for when to get my money out.

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This led to a painful drawdown for my crypto portfolio in 2018 after more than quadrupling my crypto portfolio in 2017.

But had I known about the net unrealized profit/loss indicator (NUPL), I could've saved myself a lot of money.

See It Clearly

NUPL provides insight into the overall sentiment of the crypto market. It measures the difference between the market value and the realized value of Bitcoin and other cryptocurrencies.

In simpler terms, it shows whether the market is in a state of profit or loss.

Bitcoin: Net Unrealized Profit/Loss (NUPL)

View larger image

The NUPL value ranges from -1 to +1. It can be divided into five zones that indicate market sentiment:

  • Capitulation (below 0): The market is in a state of loss.
  • Hope/Fear (0 to 0.25): Investors are uncertain, showing mixed emotions.
  • Optimism/Anxiety (0.25 to 0.5): The market is starting to gain confidence, but there's still caution.
  • Belief/Denial (0.5 to 0.75): Confidence is high, but there might be a hint of denial about potential downturns.
  • Euphoria/Greed (above 0.75): The market is in a state of high profit, often a precursor to a correction.

NUPL provides a clear visual representation of market sentiment, helping investors make informed decisions about when to enter and exit the market.

This Way, Please

There are a few ways you can use NUPL to optimize your crypto investments.

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First, when NUPL is in the Capitulation or Hope/Fear zones, it means that the market is in a state of loss or uncertainty. Historically, these periods have proven to be excellent buying opportunities.

And the timing is remarkable.

For instance, NUPL dropped to a level not seen in four years (i.e. capitulation territory) within days of the FTX collapse in November 2022.

It also dropped during the COVID-19 crash in March 2020...

Bitcoin: Net Unrealized Profit/Loss (NUPL)

View larger image

Fear and uncertainty reigned supreme. That meant prices were lower, presenting a good entry point for long-term investors.

But NUPL is also one of the best sell signals in the market. When NUPL enters the Euphoria/Greed zone, it means that the market is in a state of high profit. While this might seem like a good time to hold onto your investments, it often precedes a market correction.

The last time NUPL was in this range we were seeing a lot of market "silliness"... or what Allen Greenspan might call "irrational exuberance."

This includes New York Times headlines like this from the market peak in January 2018...

<em>New York Times</em> headline
 

Or when NFT rocks were selling for $1.3 million near the top of the 2020-2021 cycle...

NFT rocks headline
 

When NUPL is at these Euphoria/Greed levels, it's best to ignore the hype and take profits.

So what is NUPL telling us now?

More Upside Is Coming

The highly reliable NUPL indicator is currently at 55%...

Bitcoin: Net Unrealized Profit/Loss (NUPL)

View larger image

That's well below the 75% "sell" level where we cross into Euphoria/Greed territory.

If this indicator remains as reliable as it's been since Bitcoin was first launched in 2009, it means we likely still have significant upside left in this bull market.

So while investing in crypto can be volatile, tools like NUPL give you an edge by offering a deeper understanding of market dynamics.

If you want to take advantage of this buying opportunity, start incorporating NUPL into your strategy today.

I've shared THREE "next gen" cryptocurrencies to ride this rally higher with Manward Money Report subscribers. These are tokens with more advanced technology than Bitcoin or Ethereum. They're faster... cheaper... and, most importantly, institutions are just starting to pile in.

Get details on them here.

Because while we've already made a lot of money this bull run, there is still lots of upside to be had.

Stay safe out there,

Robert

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