Short-Term-Supply in Profit

Tutorial: Short-Term Supply in Profit Indicator

The Short-Term Supply in Profit is an on-chain metric that measures the proportion of coins held by short-term holders (typically <155 days) that are currently in profit compared to their acquisition price. This indicator provides insights into the confidence and potential selling pressure of recent market entrants, who tend to be more reactive to price swings.

Steps to Use the Short-Term Supply in Profit Metric

1. Understand the Concept:

• Short-Term Supply in Profit: The share of coins held by short-term holders where the current market price is higher than the purchase price.

• Relevance: Reflects how many recent buyers are in profitable positions, which influences market psychology, potential sell pressure, and momentum.

2. Interpret the Short-Term Supply in Profit Metric:

• High Share in Profit: Indicates most short-term holders are above water, often leading to increased confidence but also potential profit-taking.

• Low Share in Profit: Suggests most recent buyers are underwater, typically occurring during corrections or bearish conditions.

• Rapid Increases: Often occur during rallies, showing that recent buyers are quickly moving into profit.

• Sharp Declines: Seen during market downturns, as newer positions move into loss.

3. Analyze Historical Patterns:

• Bull Market Phases: Sustained high levels of short-term supply in profit are common during strong uptrends.

• Corrections: Sudden drops in this metric highlight stress among newer participants, often coinciding with short-term volatility.

• Cycle Tops: Excessively high levels of short-term profits can precede distribution phases, as recent buyers rush to realize gains.

4. Make Decisions:

• During Rallies: Rising short-term profits can confirm bullish momentum, but also signal caution for potential sell pressure from profit-taking.

• At Market Extremes: Very high levels may mark overheated conditions, while very low levels can reflect capitulation.

• In Transitional Phases: Monitor crossovers with loss metrics to gauge shifts in sentiment among short-term holders.

Tips:

• Pair with Short-Term Supply in Loss: Together, these metrics give a complete view of short-term holder positioning.

• Combine with Price Action: Overlay this metric with market price to identify when new entrants gain or lose conviction.

• Context Matters: High profitability is not inherently bullish — in late bull cycles it often signals distribution.

• Watch for Shifts: Rapid changes in short-term profit levels can precede volatility and trend reversals.

• Use with Long-Term Metrics: Compare with long-term holder data to assess the balance between speculative vs conviction-driven ownership.

Created By: The Short-Term Supply in Profit indicator is a widely recognized tool in on-chain analytics .