The mouth is tightening (Bitcoin realized profits have decreased & realized losses have increased)

The top indicator in the chart is the BTC price

The middle indicator in the chart is Bitcoin realized profits (365-day MA) and Bitcoin realized losses (365-day MA)

The bottom indicator in the chart is the ratio of Bitcoin realized profits (365-day MA) to Bitcoin realized losses (365-day MA), which is the "realized profit-loss ratio (365-day MA)"

This ratio reflects the overall profit and loss status of market participants by comparing the moving average of realized profits (the part where the selling price is higher than the buying price) and losses (the part where the selling price is lower than the buying price) over the past 365 days.

In a bull market, the profit-loss ratio is usually high because investors tend to take profits at high prices.

In a bear market, this ratio is usually low because investors may sell at a loss, reflecting market panic or capitulation behavior.

Using the 365-day moving average smooths short-term fluctuations and highlights long-term trends. This indicator is suitable for determining whether the market is in a state of overheating (high ratio) or excessive panic (low ratio), and is a powerful tool for judging market cycles and trends.