Bitcoin (BTC) Realized Loss Metric Shows Early Signs of Seller Exhaustion

Bitcoin's recent pullback has rattled the market, but on-chain data suggests something interesting might be brewing beneath the surface.

Bitcoin’s recent pullback has rattled the market but on-chain data from blockchain analytics firm Glassnode suggests that something interesting might be brewing beneath the surface- Bitcoin holders may be showing early signs of seller exhaustion. Their Realized Loss metric, which tracks how much capital is lost when coins are sold below their cost basis, is trending lower. After intense sell-offs in February and March, current loss figures are significantly smaller. This drop-off in loss realization hints that panic selling may be fading.

If true, BTC price could be approaching a temporary bottom as emotions begin to cool down across the board.

Glassnode’s 6-hour rolling chart of Bitcoin Realized Loss provides a clearer picture of the current market trend. Back in February and March, each dip in BTC price triggered massive waves of realized losses, showcasing widespread fear. However, with the most recent drop, those spikes are noticeably less extreme. Despite the decline in prices, investors appear less eager to sell at a loss. This could indicate that many sellers, especially those reacting to price dips, have already left the market.

Historically, this kind of capitulation fatigue often signals that the worst may be over, or at least that a stabilization phase is setting in.

Altcoins Hit Hard As Liquidity Dries Up

While Bitcoin may be showing signs of stabilization, altcoins have taken a major hit. Glassnode’s data shows the altcoin market cap, excluding Bitcoin, Ethereum, and stablecoins, has dropped from $1 trillion in December 2024 to $583 billion today. That’s a staggering $417 billion wiped out.

These tokens, which sit further out on the risk curve, tend to be the first to bleed when liquidity dries up. Investors are clearly pulling capital from high-risk assets as macro uncertainty continues. This sharp contraction underscores the fragile state of the broader crypto market and highlights how sentiment still leans cautious across most sectors.

The BTC price showed strong upward momentum on the 5-minute chart, forming a clear uptrend channel with higher highs and lows. The price eventually broke above the channel but began to stall near the key resistance at $84,000, entering a phase of sideways consolidation. This indicates possible buyer exhaustion at current levels.

The RSI consistently hit overbought levels during the rally, suggesting strong buying pressure but also hinting at short-term pullbacks. Overbought readings aligned with local tops, while oversold dips acted as rebound points. Meanwhile, the MACD displayed mixed signals, golden crosses during the rise, and more frequent death crosses near resistance, reflecting weakening bullish momentum. A solid support remains around $81,500, and a break below this level could increase selling pressure.

Overall, the BTC price faced resistance around $84,000, leading to consolidation. However, support at $81,500 is crucial for preventing further selling. The RSI indicated overbought conditions during the rally, while the MACD signaled mixed trends with weaker buying momentum. As the market stabilizes, it will be interesting to observe whether sellers emerge on a test of the support level.

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