Indicator Overview

The indicator measures the aggregate dollar value of losses currently held by Short-Term Holders (STHs), entities whose coins were acquired less than 155 days ago.

This metric is calculated as the total difference between the acquisition price and the current Bitcoin price for all STH-held coins where the current price is lower than the acquisition price. It represents the total latent selling risk from newer investors who are currently underwater on their investments. A rising value indicates increasing STH financial stress.

How To Use

The STH Unrealised Loss metric is a key measure of capitulation risk and market opportunity. Record or near-record spikes indicate that a huge amount of new capital is underwater. This high level of financial pain often leads to mass panic-selling, or capitulation, which typically marks the absolute market bottom. When STH Unrealised Loss peaks, it suggests the weakest hands are about to be, or have been, flushed out. Conversely, low, compressed readings, especially after a long consolidation or during a strong uptrend, suggest that the vast majority of STHs are in profit. This minimal unrealised loss reduces the incentive for panic selling, which is constructive for price stability. In a powerful bull market, the chart will typically remain near zero.