According to the most recent data provided by Glassnode, the Bitcoin long-term holder supply has drastically reduced, reaching levels not seen since the month of April. This bearish trend indicates that veteran investors are reducing their exposure to the market, which could trigger greater volatility in the short term for the leading digital asset.
Specifically, entities that have held their assets for more than 155 days decreased their holdings from 14.8 million BTC in mid-July to 14.3 million recorded in December. Thus, the share of circulating supply held by these investors has fallen to 71.92%, a situation that replicates the market behavior observed eight months ago just before a significant correction.
On the other hand, analyzing the historical context, it is common for this group of investors to distribute their assets during phases of retail euphoria or panic, just as happened in the 2017 and 2021 cycles. Likewise, data from CryptoQuant reveals that, on a 30-day rolling basis, the supply was reduced by 761,000 coins as of Monday, suggesting that fear of deeper price drops is causing capitulation.
Will technical support prevent an imminent crash towards 68,000 dollars?
The market’s technical structure has weakened considerably after losing support from the 50-week moving average and the yearly open at 93,300 dollars. Furthermore, price action has validated a bear flag by dropping below 92,000 dollars, which opens the door to a much more severe correction if buyers fail to defend the immediate support zones.
If the market fails to hold above the local lows of 83,800 and 80,500 dollars, the most likely scenario points to a descent towards the measured flag target at 68,500 dollars. This move would represent a 20% drawdown from current levels, confirming total control of bears over the trend and testing the psychological strength of cryptocurrency investors.
Finally, the combination of massive sell-offs by whales and the deterioration of technical indicators suggests that the market is going through a critical inflection point. As long as indicators like the RSI remain in negative territory, the possibility of recovering all-time highs seems distant on the horizon, leaving traders attentive to a possible re-accumulation phase at lower levels.
The Bitcoin long-term holder supply drops to April levels, raising the risk of a severe correction towards 68,500 dollars.
