Bitcoin’s Exchange Supply Hits 6-Year Low—Bullish Sign or Bearish Trap?

Bitcoin’s exchange supply drops to 7.53%, signaling strong holding trends and reduced short-term sell pressure.

A rising wedge pattern suggests a possible bearish breakdown, with key support levels being tested.

Despite strong fundamentals, Bitcoin faces resistance near $100K, with technicals showing potential short-term correction.

According to Santiment’s data, Bitcoin’s supply on exchanges has dropped to 7.53%, its lowest level since February 2018. This indicates a long-term holding trend among investors. Lower exchange balances often signal reduced short-term sell pressure. Consequently, this shift strengthens Bitcoin’s stability, making it more resilient to sudden price drops.

Source: Santiment

Besides, fewer coins on exchanges mean investors are moving funds to cold wallets. This suggests a preference for long-term storage over speculative trading. Institutional involvement is also growing, as more BTC moves into secure custodial solutions. Hence, Bitcoin is being increasingly treated as a store of value rather than a volatile trading asset. Moreover, historical data shows that low exchange balances often align with bullish market conditions.

Rising Wedge Signals Potential Breakdown

On the technical side, as per popular analyst Doctor Profit, Bitcoin’s price is forming a rising wedge. This pattern is often a precursor to a bearish breakdown. The current price stands at $87,433, with the wedge’s support level being tested. Moreover, the market is showing multiple wicks on recent candlesticks, indicating indecision and potential reversal.

Source: Doctor Profit

Furthermore, the 200-day moving average is below price, as long-term support. Bitcoin, however, has failed to sustain higher levels once it has crossed $100,000. Rejection at major resistance levels reflects increased selling pressure. A breakdown below the rising wedge can trigger a price decline.

With decreasing exchange balances and growing institutional usage, Bitcoin’s foundations are still solid. Technical signs, however, point to a potential short-term slump. There may be a steep drop if the rising wedge breaks downward.

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