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Bitcoin has been losing wallets on the network since October 16 of this year. With the number of non-empty wallets peaking at 59.99 million that day, the network has already lost roughly 108,700 of them as the price dropped back below $75,000. Smaller holders are clearly running out of patience.
Last chance for the price
Bitcoin's last bullish hope was a short recovery rally towards the $80,000–$81,000 price threshold in early November. It failed to hold on to that momentum and quickly tumbled towards the $76,000 area, which opened the way towards more losses. Since its October top near $87,000, BTC lost roughly 14% of its value and lost everything it built up since late August.
BTC moves below all major moving averages, with most of them aiming downwards and hinting at the aggravation of the current trend on the market. RSI confirms the thesis, moving around 40 and suggesting a bearish momentum, or a sideways movement at least.
Fueled by the falling price, retail is still fearful: smaller traders are merging or emptying their wallets. The network now holds around 59.88 million non-empty wallets, while exchange supply is down near 1.28 million BTC. The shrinking wallet count, however, isn't something that automatically means Bitcoin is being used less.
But where would BTC finally settle down? Realistically, the closest 'fair' support is the $74,000–$75,000 area, where buyers already stepped in this week. Discussing a breakdown below makes little sense, unfortunately, due to the volatile nature of the market.
Support level isn't guaranteed
But even if BTC holds the $74,000 support, bulls might still stay sidelined. There are little to no signs of retail coming back that can help BTC reach key market levels. Even worse, the market in general isn't favoring bulls, so bracing yourself for a prolonged correction might be the wise choice.
In case bulls somehow wake up, a recovery towards $78,000–$80,000 is the main priority, as it's the area where several moving averages are sitting right now. A falling wallet count with the price holding often acts as a sign of sellers getting exhausted, as smaller investors tend to give up when fear is at its highest.
Whether buyers can defend the $74,000 level or not is the main test for the asset right now. The wallet count keeps shrinking, the price is stuck below the moving averages and a short-lived price bounce here won't change the situation as a whole, unfortunately.