NUPL (Net Unrealized Profit/Loss) is an on-chain indicator that measures market sentiment based on the unrealized profits or losses of long-term holders (LTH) to analyze the state of the market. For Ethereum, LTH-NUPL specifically calculates the net floating profit ratio of long-term holders.
According to the industry-standard range division:
<0: Capitulation/Panic
0~0.25: Hope-Fear
0.25~0.5: Optimism-Anxiety
0.5~0.75: Belief-Denial
>0.75: Euphoria-Greed
(Figure 1)
Currently, the LTH-NUPL value of Ethereum is 0.59, situated in the 'Belief-Denial' zone. This means that the average floating profit rate for long-term holders has exceeded 59%, indicating strong market confidence but often overlooking potential risks. Historical experience shows that when floating profit levels are too high, some holders tend to take profits, especially as they approach previous highs or historical peaks, and this willingness to cash out may lead to temporary selling pressure.
Since 2021, the LTH-NUPL of ETH has not re-entered the 'Euphoria-Greed' zone. After multiple touches of the green zone during this cycle, market sentiment tends to quickly heat up to a peak. Therefore, the current high profit state warrants caution among players. While short-term chasing may yield profits, the risk factor is also rising simultaneously, especially for short-term players who should manage their positions carefully. Medium to long-term players can ignore short-term trends.