Exchange Deposits Decline, Easing Price Pressure

Bitcoin Selling Pressure Eases as Exchange Inflows Decline: Insights from CryptoQuant

Bitcoin

Summary:
Bitcoin's market conditions have recently changed, showing signs of short-term stability as selling pressure decreases. A decline in exchange inflows and reduced selling from large holders is contributing to this shift. With Bitcoin rebounding to a monthly peak amid these changes and several key price levels to monitor, market observers remain cautious yet hopeful.

Key Takeaways:

Bitcoin's price has rebounded to $94,000 after dropping to $80,000 on November 21.
There has been a significant 76% reduction in BTC deposited to exchanges in the past three weeks.
Large holders are reducing their selling activity, which supports price stability.
A peak in loss realization among investors may signal the end of forced selling.
Key resistance levels to watch are $99,000, $102,000, and $112,000.

A crucial factor in Bitcoin's recent price stabilization is the notable drop in BTC being transferred to exchanges. Today's deposits stand at 21,000 BTC, a sharp reduction from 88,000 BTC recorded on November 21, indicating a 76% decline in selling supply over three weeks, as reported by CryptoQuant.

Exchange Deposits

This reduction suggests that holders, particularly short-term traders, are not rushing to sell their assets in the market. Lower inflows into exchanges typically lessen downward pressure, providing a better chance for price recovery in the short term.

Large Holders Withdraw: Reduced Deposits and Smaller Transfers

Investors at the institutional level and large holders have significantly influenced the changing market scenario. The proportion of exchange deposits associated with large holders has decreased from 47% in mid-November to just 21% today. Additionally, the average size of transfers has dropped by 36%, from 1.1 BTC to 0.7 BTC.

These trends indicate that significant players are opting to take a step back rather than increasing their sell-offs. During volatile periods, large holders significantly impact market direction, and their lowered activity generally helps maintain a more orderly price environment.

Loss Realization Peaks, Diminishing Future Sell Pressure

Bitcoin's recent price recovery comes in the wake of substantial realized losses among investors, often signaling a change in market psychology. On November 13, as Bitcoin dipped below $100,000, whales and short-term holders recorded $646 million in losses, the highest figure since July.

Over the past weeks, this total has risen to $3.2 billion in net losses, likely shaking out weaker hands and curbing forced selling pressure. Although realizing losses can spur capitulation in bearish phases, once such realization happens, it often leads to more stable price action.

Key Price Levels to Monitor: $99K, $102K, and $112K

If selling pressure remains low, analysts believe Bitcoin could climb towards $99,000, which is the lower boundary of the Trader On-chain Realized Price indicator—typically a significant resistance level during market downturns. Further resistance levels appear near $102,000 (one-year moving average) and $112,000 (Trader On-chain Realized Price), according to CryptoQuant.

While market uncertainty lingers—especially with a Federal Reserve decision on the horizon—Bitcoin's latest movements suggest a market that is pausing before the next potential wave of volatility.