BTC Faces Significant Selling Pressure from Long-Term Holders

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Bitcoin (BTC) has faced intensified selling pressure from long-term holders (LTHs), who have offloaded approximately 1 million BTC since mid-September, contributing to its current 13% dip from its all-time high of $108,000. This marks the largest discount since the U.S. presidential election. While short-term holders (STHs) have stepped in to absorb some of this supply, demand imbalance continues to weigh heavily on Bitcoin’s price.


1. Long-Term Holders’ Selling Behavior
LTHs, defined as investors holding BTC for over 155 days, have been distributing their holdings as prices show strength. Over the past week, LTHs sold 70,000 BTC in a single day, marking the fourth-largest one-day sell-off this year, according to Glassnode data.

Their holdings have dropped from 14.2 million BTC in September to 13.2 million BTC, signaling a strategic move to realize profits during this period of heightened market volatility.

2. Short-Term Holders Absorbing Supply
STHs have accumulated 1.3 million BTC during the same period, partially offsetting LTHs' selling. However, this accumulation hasn’t been enough to sustain upward momentum, resulting in continued price weakness.

3. Market Liquidity and Exchange Activity
The circulating supply of Bitcoin stands at 19.8 million tokens, with 2.8 million BTC held on exchanges. Notably, 200,000 BTC have exited exchanges in recent months, indicating a trend of investors moving assets to cold storage.

This dwindling exchange balance could limit immediate liquidity, further impacting market dynamics.

Technical Outlook
Bitcoin is trading in a bearish zone, currently down 0.49% with a Relative Strength Index (RSI) of 42. The recent market sell-off liquidated approximately $1.4 billion, exacerbating downward pressure.

Key Levels to Watch
Support Level: If selling persists, BTC could dip to $85,000, a key support level aligning with the 23.6% Fibonacci retracement.

Resistance Level: For a bullish reversal, BTC must break through $101,000, a pivotal psychological and technical barrier that aligns with the 38.2% Fibonacci retracement.

Outlook and Implications
The ongoing selling by LTHs reflects a strategic shift, possibly influenced by macroeconomic uncertainties and profit-taking at current levels. Meanwhile, STHs’ buying activity suggests continued confidence in Bitcoin’s long-term potential.

However, the imbalance between supply and demand could lead to further short-term price volatility. Investors should closely monitor key support and resistance levels and market activity from these cohorts to anticipate the next significant price movement.

Conclusion
Bitcoin’s price trajectory remains uncertain amid significant selling pressure from LTHs. While oversold technical indicators hint at a potential rebound, the lack of sufficient demand from STHs raises concerns about sustained recovery. The next few days will be critical for Bitcoin as it navigates these pivotal price levels.

Will BTC bounce back like it has in past corrections, or is a deeper dip on the horizon? Only time will tell. Stay tuned for further updates!