Source: Bitcoin BTC
- JPMorgan analysts have highlighted Bitcoin futures stability which they noted is a positive sign for the digital asset whose price has struggled for the last couple of months.
- However, the analysts found that at the $30,000 support range, the near-term setup is “challenging,” and the asset is likely to continue struggling at this level.
In a note, JPMorgan analysts led by Josh Younger and Veronica Mejia Bustamante warned that Bitcoin will continue struggling as it consolidates around the $30,000 position. The analysts argued that the near-term set-up is “challenging.” Furthermore, they warned that the recent sell-off was meant to offset losses and “there is likely still an overhang of underwater positions which need to be cleared through the market.”
Fortunately, Bitcoin has established strong support above $30,000 with dips brief and followed by a strong rebound. As we reported, another team from JPMorgan last week warned that Bitcoin could easily slip to $25,000 in the coming month, citing the unlocking of GBTC shares. The team however concluded that there would not be a total price capitulation if the $25,000 support was not breached.
Related: 33% of institutional investors call Bitcoin rat poison, agreeing with BTC critic Warren Buffet: JPMorgan survey
The new outlook, though weary of the near-term target – with Fundstrat Global Advisors LLC’s David Grider going as far as recommending investors reduce risk or hedge – found one positive in the market. According to the analysts, the stability in the Bitcoin futures market offered hope for a price recovery. In addition, the increased production cost driven by the mining clampdown in China was also likely to factor in prices. FUD aside, the current mining crackdown supports a price increase with Bitcoin becoming more valuable due to a drastic drop in supply.
cryptocurrency market shows signs that it is not yet healthy, it does also appear to be beginning the process of healing.
Bitcoin defies JPMorgan
At the beginning of the week, Bitcoin has gained more than 5 percent to climb above $34,000 according to our data. For now, the $35,000 position continues to elude the digital asset.
With it, the crypto king has managed to inspire the wider market with some top altcoins going as far as outperforming it. Ethereum for instance has gained more than 10 percent and is back above $2,000. In recent weeks, the market has witnessed record volatility with price swings triggered by the slightest developments. As such, investors are torn over the direction Bitcoin takes next. The Fear & Greed Index for Bitcoin reveals that for the last month, there has been “extreme fear,” meaning that investors are worried about the next price move.
Furthermore, a poll conducted by ‘Stock to Flow’ model developer PlanB revealed that a majority of investors are no longer confident that Bitcoin will end the year above $100,000.
What a difference 3 months make!
41% now thinks bitcoin will stay below $100K in 2021 (invalidating S2F model) vs 16% in March (when BTC was $55K). pic.twitter.com/S9PKR8FSnb
— PlanB (@100trillionUSD) June 22, 2021
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