In the midst of a turbulent week for Bitcoin, JP Morgan has reiterated its stance that the cryptocurrency remains overbought despite the recent correction. Notably, there has been a notable slowdown in the inflow of funds into Spot Bitcoin ETFs, coupled with a significant increase in outflows from these investment vehicles.
The banking giant has suggested that profit-taking activities could persist leading up to the Bitcoin Halving Event. With Bitcoin’s value dropping by more than 4% in the last 24 hours, currently standing at $64,285 compared to its peak of $73,000 earlier in March, the market is witnessing a notable shift.
JP Morgan Warns of Potential Continued Bitcoin Sell-Off
As digital assets across the board experience a decline in value following a period of remarkable growth, Bitcoin has been at the forefront of this market correction. Despite a 4% decrease in the past week, JP Morgan’s analysis indicates that the sell-off of Bitcoin might not be complete, attributing this to the cryptocurrency’s overbought status.
Analyst Nikolaos Panigirtzoglou highlighted the prevailing market optimism regarding Bitcoin’s future price surge by year-end, particularly driven by expectations of sustained demand through spot ETFs even as Bitcoin supply diminishes post-halving. However, the bank’s observations reveal a notable decrease in ETF inflows and a surge in outflows, challenging the assumption of a continuous influx of funds.
JP Morgan’s report underscores the likelihood of ongoing profit-taking activities post-halving, emphasizing Bitcoin’s overbought position amidst the current market correction. As the Bitcoin Halving Event approaches in April, scheduled for April 20th, the cryptocurrency’s performance post-event remains a focal point for market observers.
