The recent analysis from JPMorgan has raised concerns about Bitcoin’s future trajectory despite the optimism surrounding the Bitcoin Halving event. According to JPMorgan strategists, Bitcoin could still face further pullbacks following its recent decline. They pointed out the net outflows recorded by Spot Bitcoin ETFs as a sign of the current bearish sentiment in the Bitcoin ecosystem. The sustained open interest in CME Bitcoin futures was also highlighted as another bearish signal for Bitcoin’s price. JPMorgan analysts even went on to say that Bitcoin “still looks overbought” and predicted further price dips leading up to the Halving event in mid-April.
Profit-Taking and Decline in Net Inflows
JPMorgan analysts emphasized the decline in net inflows into Spot ETFs, suggesting that a sustained one-way net inflow is not sustainable. They expect investors in these funds to continue taking profits as the Bitcoin Halving approaches. This wave of profit-taking is more plausible considering that Bitcoin “still looks overbought despite the recent correction.” The sentiment expressed by JPMorgan in their recent research note is quite bearish towards Bitcoin’s price, even though the flagship crypto has exceeded expectations. Last month, the bank predicted that Bitcoin could drop to as low as $42,000 after April as the “Bitcoin-halving-induced euphoria subsides.”
Different Perspectives
Naeem Aslam, chief investment officer at Zaye Capital Markets, shares similar sentiments to JPMorgan, suggesting that Bitcoin’s recent rally lacked sufficient strength. Aslam even went as far as to predict that Bitcoin could fall below $50,000 if the Halving event fails to maintain momentum. On the other hand, crypto trader and analyst Rekt Capital provided insights into what could happen post-Halving event, discussing the four phases of Bitcoin Halving. Rekt Capital mentioned a re-accumulation period that usually follows the Halving, lasting up to five months. During this period, many investors get “shaken out” due to boredom, impatience, and disappointment with the lack of immediate major results in their BTC investments. However, Rekt Capital suggested that this time could be different, especially since it is the first time this re-accumulation could occur around the new all-time high (ATH) area. He believes this “Re-Accumulation Range may simply take the shape of a regular sideways range and may not last very long before additional uptrend continuation.”
The uncertainty surrounding Bitcoin’s future trajectory is evident, with analysts at JPMorgan expressing bearish sentiments despite the optimism surrounding the Bitcoin Halving. While some believe in the potential for further price dips and profit-taking, others anticipate a possible re-accumulation phase post-Halving before an uptrend continuation. The future of Bitcoin remains unpredictable, and investors are advised to conduct their own research and make informed decisions before investing in cryptocurrencies.
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