JPMorgan analysts led by global strategist Nikolaos Panigirtzoglou, They warned in a note that BTC remains in “overbought territory” despite the recent drop in the price of the cryptocurrency. This suggests that the BTC price could fall further.
Examining two metrics, JPMorgan futures position proxies and the price premium of bitcoin futures compared to the spot price, the analysts explained: “Both metrics indicate that bitcoin remains in overbought territory despite last week’s sharp correction“.
JP Morgan: what it said about ETFs
JPMorgan further warned that recent slowdowns in fund inflows into spot Bitcoin exchange-traded funds (ETFs) cast doubt on the market’s optimistic prediction of year-end price hikes.
While hopes were high for sustained demand driven by bitcoin ETFs and the upcoming Bitcoin halvingthese new figures suggest that the flow of funds into cash ETFs may not be as steady as some anticipated.
After weeks of entries, 10 spot bitcoin ETFs that started trading in early January saw money come out last week while Grayscale’s bitcoin trust (GBTC) continued to experience significant outflows. Meanwhile, nine spot bitcoin ETFs, excluding Grayscale’s GBTC, accumulated $1.3 billion in BTC in six days.
As we approach the halving event, this profit taking is more likely to continue, especially against a backdrop of positioning that continues to appear overbought despite last week’s correction.
Last month, JPMorgan issued a bearish warning, predicting a drop in the price of bitcoin to $42,000 after the April halving. The bank also downplayed the impact of the halving and upcoming Ethereum upgrade, suggesting that the market has already factored in these events.
Earlier this month, Panigirtzoglou said: “It would be unrealistic to expect bitcoin to equal gold within investors’ portfolios in nominal amounts.” Meanwhile, JPMorgan CEO Jamie Dimon remains skeptical about cryptocurrencies, declaring this month: “Personally, I will never buy a bitcoin.”
Source: Ambito
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