Bitcoin has been fluctuating between $76,000 and $79,000, and the market conversation is now dominated by two major forces: a possible on-chain bottom signal and shifting expectations around Federal Reserve interest rate policy.
On-chain analyst Willy Woo analyzed Bitcoin’s monthly chart using the Fisher Transform indicator. Woo noted that the indicator has formed a golden cross, which he described as the fourth bottom signal in Bitcoin’s history. He said the previous three signals did not produce false breakouts. However, Woo cautioned that this signal alone is not a direct buy signal or proof of an immediate trend reversal. He added that Bitcoin may move sideways for a while before the current uptrend can continue, and that the Fisher Transform has previously turned bearish and then bullish again during bull markets without ending the main trend.
Meanwhile, crypto analyst Murphy argued that interest rate hikes by the US and Japanese central banks alone do not mean Bitcoin will re-enter a bear market. He said the pace of monetary tightening, market structure, and investor positioning matter more than rate hike decisions themselves. Murphy compared different periods: in 2022, the Fed delivered 425 basis points of hikes, including four consecutive 75 basis point increases from June to November, and Bitcoin fell from approximately $41,000 to $15,800. In contrast, during 2023, the Fed raised rates four times by 25 basis points, and Bitcoin rose from roughly $16,500 to $42,000. He also pointed out that between December 2015 and December 2017, the Fed increased rates five times by 25 basis points each, while Bitcoin surged from about $454 to $16,515.
Murphy concluded that the current Bitcoin market structure resembles early 2023 more than the first rate hike phase of 2022. In that earlier period, inflation was falling, rate hike sizes decreased from 75 to 25 basis points, and the market priced in the end of the hiking cycle. If future Fed hikes remain limited to around 25 basis points and no prolonged tightening cycle is expected, interest rate policy alone may not be enough to trigger a new Bitcoin bear market. The pace and scale of future Fed rate hikes will be critical for Bitcoin’s trajectory.
