Author: Glassnode

Translation: TechFlow

Introduction: Recently, Bitcoin has fallen to around $74,000, not only breaking below the $75,600 short-term holder cost basis but also significantly underperforming the S&P 500 and the NASDAQ in the market rebound after the midterm elections. Over the past 30 days, the total supply of stablecoins has shrunk by $14.2 billion, recording the fastest contraction since June 2022.

Although net outflows have occurred in the US spot ETF and Coinbase's premium remains under pressure, the near-term long leverage in the market has significantly cleared out, and the buying below the spot order book continues to exceed the selling pressure above. The upward structure established in August still holds above the previous low of $58,500, and two large whale wallet groups have already restarted accumulation.

Core Summary

• Bitcoin has dropped below the short-term holder cost basis of $75,600 and underperformed US stocks, while incremental capital that could drive up the price continues to flow out.

• The total supply of stablecoins is contracting at the fastest rate since June 2022, the US spot ETF has turned into net selling, and Bitcoin is also trading at a discount on the Coinbase platform.

• On the other hand, this round of correction has basically cleared out the long leverage around the current price, with the thickness of buyers on the order book exceeding that of sellers, and two large wallet groups have begun accumulating coins again.

• The peak in September was the first higher high since the historical peak in 2025, and as long as the price remains above the pre-June low of $58,500, this medium-term trend reversal structure remains valid.

Recent Buyers Under Pressure

Last week, we identified the range of $73,000 to $76,000 as a key observation point. Subsequently, Bitcoin indeed slipped into that range and traded around $74,000, now below the short-term holder cost basis of $75,600, which is the average holding cost of investors who bought in the past 155 days.

At the peak in September, nearly all short-term holders had chips in profit. As of now, this ratio has dropped to about 35%, and those short-term investors who recently chose to sell are on average facing slight losses.

The cost basis distribution clearly reveals where these chips were bought. Currently, about two-thirds of short-term chips are above the current price, distributed in three dense areas where purchases occurred from August to October, with the highest extending to $83,600.

If the market rebounds, many of these trapped holders may seize the opportunity to break even and exit. Conversely, below the current price, the only dense support zone is located between $62,000 and $66,000, primarily composed of buying near the low point in August.

It is worth noting that the larger market structure that began in August is still solid. The September peak created the first upward wave high after the historical peak in 2025, and the current price remains significantly above the pre-June low of $58,500.

If the market can regain the real market mean at $77,500, about half of the short-term holder chips will return to the profitable range.

Underperformance Compared to US Stocks

Last week, we noted that most of Bitcoin's decline during the midterm elections had actually been released before the vote. The new round of selling that began on November 5 has impacted both the US stock market and the Bitcoin market simultaneously.

However, starting November 9, the trends began to diverge. The S&P 500 index and the NASDAQ 100 index have both reclaimed their closing levels on election day, while Bitcoin fell again after the CPI data was released on November 10, with a cumulative decline of about 5% so far.

Bitcoin can only truly catch up with the recovery pace of US stocks when the price climbs back above the election day closing price of $77,800.

US Treasury Reflects More Rate Hike Expectations

The interest rate outlook continues to pressure the market. The two-year US Treasury yield reflects traders' expectations for the average Fed policy rate over the next two years. Currently, this yield is at 4.75%, which is 75 basis points higher than the Fed's current benchmark rate of 4%, indicating that the bond market is pricing in the possibility of further rate hikes.

However, it should be noted that this is far from the intense tightening shock seen in 2022. In June 2022, the same yield spread soared to 244 basis points, whereas the current yield spread is only about one-third of that time, and it has narrowed since late October.

A higher interest rate environment certainly remains a headwind for risk assets, but the bond market is not betting on a recurrence of the 2022 tightening crisis.

Stablecoins Accelerate Outflow

Stablecoins serve as the cash reserves of the cryptocurrency market, which are the dollar funds parked on exchanges and on-chain before traders purchase coins. Over the past 30 days, the total supply of stablecoins across the network has sharply decreased by $14.2 billion, marking the fastest contraction since June 2022.

The ongoing reduction in supply indicates that holders are redeeming stablecoins for fiat dollars and directly withdrawing cash from the crypto ecosystem, depriving potential upward trends of crucial "fuel."

Tether also reflects this fund outflow pressure, trading slightly below the $1 peg recently. If the 30-day supply change can return from negative to positive, it will be the first clear signal of new funds flowing back.

Weakening Demand in the US Market

The US spot Bitcoin ETF has also turned into a net redemption state. Over the past 20 trading days, these funds have recorded a cumulative net outflow of $1.6 billion, breaking through the $1.5 billion threshold we defined for a "sustained outflow period" on November 9.

However, in comparison to historical outflow periods, the scale of this round of outflows is still relatively shallow, as the depths of previous outflow phases far exceeded the current one. Based on historical patterns, ETF funds usually only turn back into net inflows after Bitcoin has reached a temporary bottom, so fund inflows tend to signal a lagging confirmation of the bottom.

Significant Negative Premium on Coinbase

The Coinbase premium index measures the price difference between Bitcoin on the main trading platform for US investors, Coinbase, and the global composite price. We have excluded the discount interference caused by Tether slightly unpegging below $1 to avoid amplifying the visual negative premium extent.

From the 30-day average perspective, during the decline from the September peak, the Coinbase premium has remained negative, and the current depth of the discount has hit the lowest point since February this year.

In every past upcycle, active buying by US buyers has pushed the premium to stay positive, whereas US buying is clearly absent now. If this premium can turn positive and hold steady for several weeks, it would signify a true return of domestic demand in the US.

Sparse Chips Around Current Price, Dense Liquidation Below

The liquidation heat map calculates the trigger zones for forced liquidation of positions at different price levels. The positive aspect is that the decline since the September peak has cleared out most of the long liquidation positions built up along the way, as indicated by the dark vacuum area behind the candlestick chart.

This significantly reduces the risk of a continued cascading liquidation near the current price. Over the past six months, the largest liquidation dense area on the heat map has been far below, between $59,500 and $62,600, and it has not been touched since the August low.

Between this dense area and the current market price, liquidation distribution is very thin. Meanwhile, although the price has fallen about 15% from the September peak, the total open interest across the network has rebounded to the level seen at the September peak, indicating that many traders are adding shorts during the downward phase.

If the price turns upwards, these new shorts will be forced to buy back to cover their positions; the largest short liquidation dense area above the current price is located near $87,500.

Buying Pressure Below Exceeds Selling Pressure Above

The spot order book shows a similar bullish support pattern. Since the selling wave on November 5, the buy orders within the 5% range of current prices on Binance and Coinbase have exceeded sell orders in every hour interval.

The brackets in the heat map below indicate the areas of the most concentrated buy orders, primarily distributed in the range of $68,000 to $72,500. The upper brackets show a starkly contrasting picture: after crossing the tightly positioned sell orders near the current price, the entire sell order book until about $84,000 is extremely sparse, corresponding to the dark vacuum area shown in the chart.

This means that if the price breaks upward, there is little resistance from the order book itself, although it will still need to digest the selling pressure from those short-term holders waiting to break even. It should also be noted that limit orders may be withdrawn at any time; in fact, some bottom-buying orders were briefly removed during the sharp fall in early November before being placed back.

Large Wallets Begin to Intervene

The Accumulation Trend Score tracks the accumulation or reduction behavior of different wallet groups based on their holding sizes (close to 1 indicates active accumulation, close to 0 indicates distribution), weighted by holding volume.

Over the past week, two wallet groups have seen scores rise above 0.5: group holding between 100 and 1,000 BTC, and group holding between 1,000 and 10,000 BTC. These two groups had remained in distribution mode for most of October.

However, it is worth noting that these two types of large wallets also briefly shifted to buying in late September but could not sustain it at that time. In addition, all other wallet groups are still continuing to reduce their holdings, from super whales holding over 10,000 BTC to retail wallets holding less than 1 BTC.

This shows that this is merely an early test of bottom fishing by a small range of funds. Only when the small to medium-sized holding groups also follow in will it be considered a full recovery of buying power in the overall market.

Conclusion

Bitcoin is experiencing a correction in an environment lacking incremental funding support: recent buyers are generally at a loss, significantly underperforming US stocks, and significant funds are draining from stablecoins, US spot ETFs, and domestic US buying. There are indeed not many direct catalysts for favorable conditions in the short term.

However, conversely, the long leverage around the current price has been effectively cleared out, and two major wallet groups have taken the lead in purchasing. For investors seeing August this year as the starting point of a major cyclical trend reversal, the current situation is a critical window for the market to brew a mean reversion.

If the market can successfully reclaim the short-term holder cost basis at $75,600, it will strongly validate this bullish judgment. Conversely, if it continues to fall below the lower boundary of last week's observation band at $73,000, it would indicate a longer-term oscillation. If it closes substantially below the pre-June low of $58,500, it would completely falsify the reversal trend established in August.

Data Cut-off Time: Prices and derivative data are as of 11:00 UTC on November 11, 2026; spot order book data is as of 09:00; ETF fund flows, stablecoin supply, cost basis, and accumulation trend scores are as of November 9.

Disclaimer: This report does not constitute any investment advice, and all data is for informational reference and research purposes only. Any investment decision should not rely solely on the content of this article; readers must bear full responsibility for their own trading actions.

The exchange balance data mentioned is derived from Glassnode's address label database, which combines official disclosures and self-researched clustering algorithms. Although we strive for rigorous and accurate data, the relevant statistics may not cover all reserves of certain exchanges that have not publicly disclosed official addresses.

Users should exercise caution and independent judgment when using the above on-chain indicators; Glassnode is not responsible for any discrepancies in statistical metrics or potential errors.

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