JPMorgan strategists have issued a warning that Bitcoin may continue to see its price decline. This is because Bitcoin has retraced over 10% from its peak. Interest in spot Bitcoin ETFs has also diminished. In a recent report, strategists led by Nikolaos Panigirtzoglou observed significant outflows from Bitcoin ETFs. This marked the largest three-day withdrawal since their inception on January 11. Concurrently, Bitcoin is undergoing one of its toughest weeks this year. It recorded a 4% drop. Currently, Bitcoin trades at $65,971 with a market cap of $1.297 trillion.
The strategists at JPMorgan highlighted that Bitcoin is in the ‘overbought’ territory. They predict further declines leading up to April’s halving event. The research notes a slowdown in net inflows into spot Bitcoin ETFs. Over the past week, there has been a notable outflow. This trend raises concerns about the future flow into Bitcoin ETFs. The report anticipates continued profit-taking as the halving event approaches. This is particularly likely given the current overbought positioning.
JPMorgan predicts Bitcoin price decline post-April
Despite reaching near record highs on March 14, at $73,798, Bitcoin’s rally lacks momentum. Naeem Aslam of Zaye Capital Markets pointed out this lack of strength. He suggested that without sustained momentum, Bitcoin might see a significant price drop. This drop could push its price below $50,000. Last month, JPMorgan forecasted a gradual decline in Bitcoin’s price to $42,000 post-April. They attributed this to the fading euphoria after the Bitcoin halving event.
Market analysts have differing views on Bitcoin’s immediate future. Some believe it will enter a consolidation phase. Crypto analyst Michael van de Poppe shared this sentiment. He noted Bitcoin began correcting before a recent Federal Open Market Committee (FOMC) meeting. After the meeting, the price bounced back. This suggested the start of a consolidation phase. Van de Poppe anticipates sideways movement in the near term. He believes the local bottom for Bitcoin has been reached.
Bearish indicators emerge for Bitcoin’s market outlook
JPMorgan’s strategists noted bearish indicators for Bitcoin’s price. One such indicator is the sustained open interest in CME Bitcoin futures. This contrasts with the decreasing flows into ETFs. The combination of these factors presents a bearish outlook for Bitcoin. The report challenges the previously held belief of sustained inflows into Bitcoin ETFs. The recent outflow suggests a shift in investor sentiment. As the market approaches the Bitcoin halving event, this trend may continue.
The outlook on Bitcoin remains mixed among analysts. While some predict further declines, others see a period of consolidation ahead. The recent movements in Bitcoin ETFs and futures indicate a complex market dynamic. Investors are closely watching these developments. They seek to understand the impact on Bitcoin’s price trajectory. As the market evolves, the strategies and predictions of market analysts will be crucial in navigating the cryptocurrency landscape.
