UTxO Data/Indicators
Entry into UTxO data/indicators
It stands for unspent transaction output(UTxO)
-What is UTxO
-How UTxOs are created and destroyed
The amount/ratio of UTxOs being in profit or loss
-Amount
The number of UTxOs being in profit/Loss
-Profit/Loss Percent
Ratio of the number of UTxOs being in
Numbers of UTxOs that are in Profit
Numbers of UTxOs that are in Loss
Ratio of UTxOs that are in Profit
Ratio of UTxOs that are in Loss
The sum of UTxO's alive days and its value
High
Long-held coins are moving in great amounts - Bearish
Low
Long-held coins are moving in less amount - Bullish
Increasing
Increasing Selling pressure - Bearish
Decreasing
Decreasing selling pressure - Bullish
The mean value of products of coin unspent transaction output (UTxO) alive days and its value
Continuous rise
The total days of coins alive accumulate - Bullish
Sudden decrease
Coins that were dormant moved in mass - Bearish
Spent Output Profit Ratio (SOPR) evaluates the profit ratio of the whole market participants by comparing the value of outputs at the spent time to created time
Modified SOPR that eliminated noises
Modified SOPR that focuses on the behavior of short-term UTxOs.
Modified SOPR that focuses on the behavior of long-term UTxOs.
Reason to look for UTxO indicators
Best for tracking down Long term holders
It is reasonable to assume that long-term holders' bags are "Smart money" and it provides valuable insight for investors to notice their movements if they start to move in anyways. What makes these indicators better is that the longer the bitcoin holder had, the more sensitive indicator is to the movement of the long-lived UTxOs.
The longer-lived UTxOs move, the more change in values for these indicators enabling people who use this metric to notice the difference easily. Thus, the best way to capture these "Smart money" movements is through utilizing UTxOs.
Also because UTxOs are like traceable cash with the wallet's name on it, it is also possible to easily trace the record of how long those UTxOs are held. It is best at tracking long held coins but also easy to differentiate investors by age and draw behavior indications from tracking them.
How to look at indicators
This section identifies the lookout point for individual indicators. These indicators could be divided by their identity and their usefulness in trading. Each indicator utilized each feature of UTxOs and put together they cover multiple aspects and capture movements in UTxO relatively precisely.
If you want to make use UTxO's feature of by figuring out
1) How many UTxOs itself is in profit or not
Checking the absolute number of UTxO in Profit or loss
Profit and Loss (UTxO)2) Focusing on figuring out the days of UTxO lived or destroyed
Sum Coin Age (SCA)Coin Days Destroyed (CDD)3) Closer look on whether or not certain kinds of UTxOs were moved in profit or not
Spent Output Profit Ratio (SOPR)It is wise to take a look at each indicator according to the number stated above.
Points to be aware
When the UTxOs are moved, it doesn't necessarily mean that all of them are sold or bought.
Relating any UTxO movement to trade-related actions and applying them to the indicators would not fit the purpose of the creation of these indicators. For instances of internal wallet movement, the UTxO does move, but it does not necessarily have to do with price issues.
However, it is important to note that any kind of movement on the chain exposes the wallet to the security cost of sending to a wrongful address, getting into on-chain radar just by moving, and paying fees to have any kind of transaction.
Thus, it is quite reasonable to assume that every transaction has to have a purpose behind it.
Last updated
