Cryptocurrency Market Downtrend Nearing its End, JP Morgan Research Suggests
Summary:
JP Morgan research suggests that the cryptocurrency market's downtrend may be ending as most long-position liquidations have been completed. The decline in Bitcoin's open interest is seen as a signal of weakening price trends, leading to limited downside for crypto markets in the near term. However, declining optimism around regulatory developments, rising US real yields, and concerns about China's economic growth have contributed to the recent decline in the crypto market.
The decline in the cryptocurrency market seems to be coming to a close, as new research from JPMorgan suggests that most long-position liquidations have already been completed. JPMorgan analysts predict that the liquidations are mostly in the past based on the open interest in Bitcoin futures contracts, indicating a potential slowdown in selling. The decline in Bitcoin's open interest is seen as a signal that the current price trend may be weakening, leading to limited downside for crypto markets in the near term.
In recent weeks, crypto prices have been on a downward trend due to dwindling optimism around regulatory developments in the US. As of August 26, Bitcoin is trading around $26,000, representing an 11.27% decrease over the past month.
While positive developments in recent months, such as applications for Bitcoin-linked exchange-traded funds (ETFs), have boosted Bitcoin's price, the report notes that this optimism is fading as traders now await ETF decisions and the Securities and Exchange Commission's appeal against Ripple, which creates renewed uncertainty. This legal uncertainty, combined with external factors like rising US real yields and concerns about China's economic growth, has contributed to the decline in the crypto market.
Article source:
Cointelegraph
Published At
8/26/2023 8:08:43 PM
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