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A rising indicator in the crypto market is the bear market really coming to an end?

Bitcoin and Ethereum started out of extreme oversold trends and rebounded after the positive news after the MOFC meeting in July. It is now worth watching whether this rally is a rebound in a bear market or the beginning of a new sustained bull market.

Bitcoin and digital asset markets reacted strongly to the Fed’s policy of raising interest rates by 75 points this week, with BTC closing up 5.7% and ETH up 7.6% this week. The market also responded positively to the FOMC. Fed Chairman Powell said that the current federal funds rate of 2.25% to 2.5% is appropriate, and the Fed’s main focus is the slowdown in economic development.

In many ways, the recent positive price action in Bitcoin and Ethereum has brought long-awaited good news for bulls after a nearly nine-month-long downtrend. The bear market of 2022 has a lot of adverse effects on the digital asset space. Whether the current rally is just a relief in a bear market or a harbinger of a bull market start has attracted a lot of attention after the market’s continued risk aversion .

In this article, we will discuss this concept using on-chain activity with digital assets as a benchmark, and we need to clarify whether the market is signaling a new entry, or this rally is just a flash in the pan.

Bitcoin Price Week 31

Bitcoin’s sideways move

Generally speaking, the influx of new demand into the blockchain network is supported and signaled by the continuously rising demand on the chain. So we can analyze recent historical data using on-chain activity and supply dynamics.

Bullish trends tend to come from an increase in on-chain behavior and users. Usually this increase in on-chain behavior comes from the resale of on-chain transactions—for example, old participants resell their tokens for profit, and these transferred tokens are bought by new participants. Such frequent on-chain transactions will prompt a bullish trend in the entire token market.

The bearish trend comes from a reduction in on-chain behavior, which often occurs when token prices take a sharp…

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