Definition:
Percentage of circulating supply that has been traded in the last 6 months.
Supply Last Active 0-6 Months (SLA 0-6M) is the activity level of short-term traders, such as day traders and swing traders. Commonly referred to as weak hands, they’re traders who do not hold assets for a significant amount of time.
In the photo below, you can see the amount of supply last active between 0 and 6 months ago since 2010. One can note that peaks in SLA 0-6M occur when Bitcoin is nearing a market top.
What to watch for:
Bullish activity: If a high percentage of coins have been traded in the last 6 months, it could indicate that short-term traders are actively buying and selling, indicating a high level of market activity and potentially a bullish short to mid-term sentiment.
Market peaks: In the past, the metric of recently transferred supply (last active in the last 6 months) has reached between 35% and 50% during market highs. This is often seen as a sign of increased speculation during upward price movements.
As Warren Buffett once said, "be fearful when others are greedy, and greedy when others are fearful." This quote is a reminder that when the market is flooded with speculation and investors are rushing to buy an asset due to its upward price movement, it may be a good time to consider selling that asset. In other words, it's a time to be cautious and take profits rather than join the herd and risk getting caught in a market top.
Bearish activity: If a low percentage of coins have been traded in the last 6 months, it could indicate that short-term traders are less active, which could indicate a bearish short to mid-term sentiment or a lack of confidence in the market.
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