Bitcoin’s long-term holder stash drops to 8-month lows: BTC price to $68K?

Bitcoin (BTC) Long-term holders continued to reduce their BTC exposure as their holdings fell to their lowest level since April.

Key Path:

• Bitcoin long-term holders reduced their supply by 72%, the lowest since April

• BTC price is at risk of a deep correction to 68,500 if the key support level fails.

Bitcoin long-term holder supply falls to April levels

According to Glassnode data, long-term holders (LTHS), institutions that have held bitcoin for at least 155 days, reduced their holdings by 14.3 million BTC in mid-July to December.

This has reduced the percentage of provision held by these investors to 71.92%, which was last seen in April, as shown in the chart below.

Related: Bitcoin sharks stack at fastest pace in 13 years, with BTC down 30%

The April data came as bitcoin fell from a high of $109,000 on January 20, which is $74,000. LTHS took advantage of the low prices and increased their supply by 76% in July, leading to a 65% rally in bitcoin’s price to its previous record high of 3,123,000 on July 14.

If a similar scenario unfolds, LTHS saw BTC’s latest low of $84,000 as an opportunity to increase its holdings, sparking a recovery to new all-time highs in the next few months.

Zooming out, LTH supply typically sees sharp declines during retail-driven phases and is sold by LTHs that coincide with cyclical peaks, as seen in 2017 and 2021.

Analyzing the change in the supply of LTH, data from Cryptocoin shows that on a 30-day basis, the supply decreased by 1.1 million BTC on November 26, the second largest on record.

As of December 15, LTH supply has fallen by 761,000 coins over the past 30 days, suggesting that investors are convinced as concerns of a deeper price decline.

As Quintalgraph reported, the wheels sold 2.78 billion in BTC over the past 30 days, keeping the downside firmly in place.

Can the price of BTC survive a trip below 70,000?

Bitcoin’s technical structure weakened after missing support at the 50-week moving average (MA) and annual open at $93,300.

The chart below shows that the BTC/USD pair confirmed a bearish flag when it broke below the lower range of the flag on December 12.

The first area of ​​interest is now the local low of 83,800 (arriving on December 1st) and the multimont low of 80,500, which arrived on November 21st.

Losing this support zone would open the door for a deeper correction towards the flag-measuring target at $68,500, which is supported by the 200-week MA. Such a move would represent a 20% drawdown from the current price.

“BTC has once again broken down, confirming the fish flag,” analyst Nick said in an X-Post on Tuesday, adding that the next “possible support” is the 100-week EMA at $85,500.

“If we break it down, there are key Onchin levels like .8 83.8k (ETF cost basis) and .2 81.2k (actual market mean),” before coming to 80,000 in this picture, the analyst added.

As reported by QuintileGraph, the 20-day EMA has started to decline, and the RSI is in negative territory, indicating that the bears are in control.

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