Is it a good time to accumulate Bitcoin? This is what the string data says

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Bitcoin price rose after the Federal Reserve announced a smaller rate hike than seen in previous meetings and has consistently indicated that continued hikes may be warranted. However, the king currency was pulled lower as the dollar rallied with the return of risk aversion, leading to relatively bearish sentiment among investors.

On Wednesday, the Federal Reserve raised its target federal funds rate by 0.5%, bringing it to a range between 4.25% and 4.5%.

This decision was in line with Wall Street expectations. According to reports, members of the Federal Open Market Committee do not anticipate a shift from rate hikes to rate cuts until the year 2024.

Bitcoin is now trading in a bearish direction, although it just breached a crucial resistance level around $18,150. The price of Bitcoin, however, fell below the $18,000 level after the Fed declared that it will raise interest rates.

This indicates the possibility that the current sales pattern will continue. BTC is trading at $17,708 at the time of this writing, which represents a drop of around 1% in the previous 24 hours.

What does the on-chain data suggest?

According to on-chain data, the Bitcoin (BTC) Spent Output Value Bands: All Exchanges metric suggests that the amount of whale deposits on cryptocurrency exchanges is falling.

Typically, the development of the Bitcoin market bottom is caused by whales selling off their BTC holdings by transferring them to cryptocurrency exchanges.

After a year-long bear market that saw huge sell-offs by whales and miners, Bitcoin is now entering an accumulation cycle ahead of the next halving.

In fact, institutional investors are expected to quietly buy the dip in a manner similar to the accumulation cycle that occurred in 2019-20.

Cryptocurrency analysis says:

In terms of spending, the continued high level of whale-related spending is inconsistent with a sign that could lead to a shift in the market cycle. A sustained upward price trend is usually accompanied by whales holding their bitcoins.

In a related development, according to the results of a survey conducted by a reputable crypto analytics platform, despite the fact that 2018 was a tough year for the majority of the cryptocurrency market, it does not seem be of shortage of believers that 2023 would give a chance of healing.

Cryptocurrency monitoring website CoinMarketCap is currently conducting a year-end summary survey. Participants were asked to submit their votes based on whether or not they expected next year to be bullish or bearish, and more than eighty percent of respondents voted “bullish”.

Is it the right time to buy?

Bitcoin traded in a narrow band between $18,500 and $20,000 between September and October. However, after the staggering collapse of crypto exchange FTX, bitcoin plunged 26% at one point.

For anyone wondering if now is a good time to buy Bitcoin, I wouldn’t recommend it. The overall bitcoin macroeconomics is unfavorable. The on-chain/stream numbers for bitcoin are quite bearish.

So if you have a time horizon of two to four weeks, it’s definitely not the best time to buy bitcoin. Unless you are aiming for long term gain.

As such, you can buy and be prepared to hold on for months, when ideally things would have improved a lot.

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