Three Things to Know Stablecoin supply just posted its sharpest monthly contraction since the Terra collapse, Glassnode said. Bitcoin's daily momentum gauge sits deep in oversold territory, y
Glassnode warned this week that the crypto market's cash pile is shrinking fast. Stablecoins left the system at a pace not seen since 2022, and bitcoin slid under the price most recent buyers paid.
That matters because stablecoins fund most crypto purchases. With ETF money also leaving, bitcoin has fewer buyers to lean on. Traders now want to know if large holders' bids can hold the line before forced selling takes over.
Stablecoin supply shrank by $14.2B in the 30 days through Nov 9, on-chain analytics firm Glassnode said this week. That is the largest contraction since the Terra collapse in June 2022. Stablecoins are the cash traders use to buy crypto, so a smaller pool leaves "less fuel for a rally," the firm warned.
Fund demand is fading as well. Glassnode said about $1.6B has left US spot bitcoin ETFs over 20 sessions. Farside data showed $299.8M in outflows on Nov 11 alone, mostly from BlackRock's IBIT.
Outside pressure piled on. Nvidia CEO Jensen Huang resigned on Nov 12. Hotter US inflation data raised the odds of a December Fed hike, which pushed the dollar and yields higher. Iran's IRGC also claimed a strike on a US radar site in Bahrain.
Leveraged traders took the hit. CoinGlass counted $1.23B in liquidations over 24 hours, mostly long bets, with bitcoin accounting for about $677.5M. Ether fell 6.2% to $1,922, and XRP traded near $1.
Bitcoin (BTC) daily price with the nearest support (green) and resistance (red). Source: TradingView
Bitcoin traded near $69K on Friday, down about 3% in the past day. That leaves it below both of the moving averages traders watch most. A moving average smooths out daily swings by tracking the average closing price over a set number of days.
The 50-day average sits near $78K. The 200-day average sits near $76K. When price trades under both lines, those lines tend to act as ceilings on any bounce. The shorter average still sits above the longer one, a sign the drop from recent highs was fast and steep.
Glassnode's cost data adds another layer of pressure. The firm puts the average buy price of recent investors near $75,600. Anyone who bought in that wave is now sitting on a loss. Many may sell when price climbs back toward their entry. That creates a band of supply right where the two averages also sit.
The losses run across every timeframe. Bitcoin is down about 10% over the past week and about 18% over the past month. A decline that builds week after week points to steady selling from holders who are losing patience.
On the daily chart, each attempt to recover has stalled below prior highs, and sellers have kept setting lower prices.
Bitcoin's daily RSI stands at 25. RSI is a 0 to 100 gauge of momentum, and readings under 30 count as oversold. Stretches like this often come before relief bounces, as short sellers take profits and bargain hunters step in.
An oversold reading does not mark a bottom on its own. Price can stay oversold for days while it keeps sliding.
Other gauges point the same way. The MACD, which compares short and longer-term price trends, remains below its signal line. In plain terms, momentum is still pointing down. Trend strength readings also show a real trend, and sellers are leading it. Any bounce from here would need to hold for several sessions before it signals a turn.
Large holders are starting to step in. Glassnode said wallets holding 100 to 10,000 BTC have placed large buy orders. Those bids sit between $68,000 and $72,500. Bitcoin already sits inside that band, so those bids are being tested now.
The firm flagged a second buying area between $62,000 and $66,000. That zone overlaps with the nearest support on the daily chart. If the whale orders keep absorbing sales, the oversold slide could slow there.
A break below that support would weaken the case. The next support sits near $59K, and little stands in the way between the two levels. Forced selling from leveraged longs could speed up any move in that gap.
Recovery has a clear first test. Resistance sits near $75K, close to the 200-day average and the recent buyers' cost. A daily close above it would show buyers can absorb that supply. The next ceiling waits near $80K.
Bitcoin's trend stays bearish until fresh money returns. That means stablecoin supply growing again and ETF flows turning positive for more than a session or two.
Risks cut both ways. Oversold markets can spark sharp short squeezes that catch bears off guard. Another macro shock, from inflation data or the Middle East, could deepen the drop.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
