STHs Have Logged $7 Billion in Realized Losses, the Most in This Cycle

Short-term holder behavior is crucial as Bitcoin’s price remains under key moving averages, which influences near-term trends.

Bitcoin Losses Climb, But Stay Within Historical Range

Short-term Bitcoin (BTC) holders are experiencing increasing unrealized losses, indicating a significant turning point in this market cycle. Data from Glassnode shows that short-term holders (STHs) may be approaching the +2 standard deviation level, often seen during peak distress. However, losses remain within normal bounds for bull markets and haven’t reached capitulation levels.

As of now, over $7 billion in realized losses have been recorded in the past 30 days – the highest in the current cycle, yet significantly lower than previous peaks of $19.8 billion and $20.7 billion in May 2021 and June 2022, respectively. This suggests that while losses are rising, many investors are choosing to exit before experiencing deeper capitulation, which hints at underlying market resilience.

Bitcoin’s Price Structure and Risk Zones

At press time, Bitcoin was trading at $84,322, just under its 50-day moving average of $85,141 and far below the 200-day moving average of $95,174. These act as key resistance levels that could hinder upward momentum, especially if sentiment among short-term holders remains weak. The tightening Bollinger Bands indicate a potential breakout is on the horizon.

However, with short-term holders under pressure, the market could lean bearish without fresh demand.

What This Means for Bitcoin’s Trend

The rise in both unrealized and realized losses signals heightened risk for those who purchased at recent highs. Still, since losses are within historical patterns typical of bull markets, a macro reversal is not yet certain. If Bitcoin can reclaim the $85,000 level and convert it into support, this may bolster confidence among STHs. Conversely, failing to maintain $83,000 may result in increased selling, testing lower supports around $80,000.

Overall, short-term pain is evident but not extreme. As long as Bitcoin remains above critical psychological levels and macro flows stay stable, this correction could represent a reset rather than a significant reversal.