5,000 BTC Wallets Exit as RSI Signals Pullback—Is Bitcoin Overbought?

Key Insights:

• Over 5,300 Bitcoin wallets with ≥1 BTC have exited since March 2025.
• Bitcoin price rose from $87,300 to over $104,000 in the same period.
• Wallet count drop may reflect retail selling as prices approached record highs.

While Bitcoin’s price is at a near-record level, more than 5,000 wallets with at least one bitcoin have been emptied since March, and the RSI suggests the market may be overbought. However, the LMACD is still bullish, which indicates the top of the cycle could still be in the future.

Drop in Bitcoin Wallets with ≥1 BTC Raises Questions About Retail Activity

Glassnode reports that the number of Bitcoin wallets with one full BTC has been steadily decreasing. From March 4 to May 13, the number of such wallets fell from 996,458 to 991,070, which is a decrease of 5,388 over two months.

Smaller investors sold their BTC when the price went from $87,300 to over $104,000. When the price goes up and the number of full-coin wallets falls, it usually means that retail investors are taking profits.

The fact that wallets are decreasing despite rising prices suggests that smaller participants are not accumulating as much. When prices go up, it is typical for some to leave the market before it peaks.

RSI Enters Overbought Zone, Warning of a Short-Term Price Cooling

Additionally, RSI is currently showing that Bitcoin is overbought. The RSI-14 line went above 70 in early May and has stayed there. An RSI value above 70 usually suggests that the price of an asset is overbought, which may result in a short-term correction.

BTC usually took a brief pause or pulled back a little when RSI was above 70 and stayed there in past cycles. By May 2025, the price had risen to more than $104,000, close to its highest point. Even so, the RSI seems to indicate that the market may be overheated in the short run.

It is not necessarily proof that a reversal has happened. Instead, it means that the present pace may not continue unless there is a short adjustment.

Long-Term Cycle Top Not Confirmed, LMACD Shows More Room Before Peak

Meanwhile, a look at the monthly Bitcoin chart suggests that the current cycle peak might not have been reached yet. LMACD is used in the chart, which measures momentum on a long-term basis. The token has reached its highest point when the blue line of the LMACD has crossed under the orange signal line.

This has not happened yet. In 2014, 2018, and 2021, after each cycle top, the MACD crossed downwards. Currently, the MACD lines are heading up and do not show any signs of turning down. It looks like the current cycle can go on for a while before it finishes.

Even though RSI shows some concern in the short run, LMACD continues to indicate that the market is strong. This arrangement of short and long timeframes may be confusing, but it also shows that BTC often slows down before continuing its overall trend.

Bitcoin Price Near All-Time Highs, But On-Chain Trends Are Mixed

Bitcoin’s price has recently gone above $104,000, approaching its highest price. This rally in price was part of a wider movement in the crypto market. However, certain on-chain indicators give conflicting results. Although the long-term trend is favourable, the wallet count and RSI are showing signs of caution.

The fact that wallets are falling while price rises suggests that some people are no longer interested.

All in all, BTC does not seem to have reached a cycle top yet. Even so, the decline in RSI and wallet count suggests that the price could pause or fall before going up again.

Disclaimer

This article is for informational purposes only and provides no financial, investment, or other advice. The author or any people mentioned in this article are not responsible for any financial loss that may occur from investing in or trading. Please do your research before making any financial decisions.