Bitcoin’s Long-Term Holder Reserves Hit 8-Month Low: Is BTC Price Heading to $68K?

Bitcoin (BTC) long-term holders have continued to decrease their BTC exposure, with holdings now at their lowest since April.

Key takeaways:

• Long-term holders of Bitcoin have reduced their supply to 72%, the lowest level since April.

• The BTC price faces the risk of a deeper correction to $68,500 if crucial support levels break.

Bitcoin long-term holder supply reaches April levels

As per Glassnode data, long-term holders (LTHs)—those holding Bitcoin for over 155 days—have decreased their holdings from 14.8 million BTC in mid-July to 14.3 million BTC in December.

This reduction has brought the percentage of circulating Bitcoin held by long-term holders down to 71.92%, a mark last recorded in April, as depicted in the chart below.

Related: Bitcoin sharks accumulate at their fastest pace in 13 years, while BTC is down 30%

April’s figures coincided with Bitcoin’s decline from its all-time high of $109,000 on January 20, hitting a low of $74,000. LTHs capitalized on this dip, increasing their supply to 76% in July and triggering a 65% rally in Bitcoin’s price to reach a record high of $123,000.

If a similar pattern repeats, LTHs might view the latest BTC price drop to $84,000 as a chance to enhance their holdings, potentially leading to a resurgence to new all-time highs in the upcoming months.

Generally, LTH supply experiences significant declines during retail-driven phases, indicative of broader selling trends by LTHs at cycle peaks, as witnessed in 2017 and 2021.

According to CryptoQuant data, the LTH supply dropped by 1.1 million BTC on November 26, marking the second-largest reduction on record.

As of Monday, the LTH supply has diminished by 761,000 coins over the last 30 days, implying that these investors are capitulating amid rising fears of further price declines.

As Cointelegraph noted, whales sold off $2.78 billion in BTC in the past 30 days, maintaining downward pressure in the market.

Can BTC price stay above $70,000?

Bitcoin’s technical outlook has weakened after losing support from the 50-week moving average (MA) and the yearly open at $93,300.

The accompanying chart illustrates that the BTC/USD pair confirmed a bearish flag pattern by dropping below its lower boundary at $92,000 on Friday.

Currently, the first critical area of interest is between the local low of $83,800 (on December 1) and the multimonth low of $80,500 (hit on November 21).

A breach of this support zone would pave the way for a deeper correction toward the target set by the flag at $68,500, supported by the 200-week MA. This potential decline would represent a 20% drop from the present price.

“BTC has broken down again, validating the bearish flag,” stated analyst Nic in a recent X post, noting that the next “potential support” is at the 100-week EMA, located at $85,500.

“If that level fails, important on-chain levels like $83.8K (ETF cost basis) and $81.2K (true market mean) will come into play, followed by $80,000,” the analyst continued.

As reported by Cointelegraph, the 20-day EMA has begun to decline, with the RSI in negative territory, signaling that bears currently hold the upper hand.

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