Bitcoin undergoing 'healthy correction,' analyst says

Although Bitcoin has given back some of its gains following the U.S. Federal Open Market Committee's (FOMC) interest rate announcement in March, an analysis suggests this is a healthy correction within an uptrend, citing robust on-chain data. In a contribution to CryptoQuant, analyst firm XWIN RESEARCH JAPAN explained that Bitcoin's rapid decline was a "sell the news" event. This was because weakening expectations for a rate cut dampened the outlook for a short-term liquidity injection into the market. However, the firm noted that on-chain data remains strong. Bitcoin holdings on exchanges are steadily decreasing while ETF holdings are increasing, indicating a continued trend of institutional accumulation. A shrinking supply during a correction phase could support upward momentum in the medium term. In particular, the continued accumulation by whale investors even as prices fall demonstrates long-term positioning. The analysis concluded that the market is in a phase where short-term adjustments due to macroeconomic variables are occurring simultaneously with medium-term structural strength. This is seen as a healthy correction within an uptrend, not a simple bear market.