JPMorgan Chase has released an investor note stating that the cryptocurrency market appears “to be beginning the process of healing.” In the short term, however, the JPMorgan analysts expect further sell-offs before capitulation.

JPMorgan’s Crypto Market Outlook

JPMorgan Chase’s analysts, including Josh Younger and Veronica Mejia Bustamante, wrote about the outlook of the cryptocurrency market in a note published Friday.

They explained that the near-term outlook for the crypto market is “challenging,” noting that blockchain data suggests recent cryptocurrency sell-offs were made to cover losses. “There is likely still an overhang of underwater positions which need to be cleared through the market,” they detailed.

The analysts also warned of the possibility of increased production costs of BTC as China’s crackdown pushes bitcoin mining abroad. Nonetheless, the JPMorgan analysts see stability in the bitcoin futures market as a positive factor. They concluded:

Cryptocurrency market shows signs that it is not yet healthy, [but] it does also appear to be beginning the process of healing.

Last week, a different JPMorgan analyst, Nikolaos Panigirtzoglou, wrote that despite the recent correction, “we are reluctant to abandon our negative outlook for bitcoin and crypto markets more generally.” He emphasized, “Despite some improvement, our signals remain overall bearish.”

Panigirtzoglou added that bitcoin’s fair value, derived from comparing its volatility to gold, is in a range of $23,000 to $35,000 in the medium term. He elaborated:

It would still take price declines to the $25,000 level before longer-term momentum would signal capitulation.

What do you think about the comments by JPMorgan’s analysts? Let us know in the comments section below.

Tags in this story

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

Read disclaimer

Articles You May Like

Amendments to MSRB Rule G-27 don’t go far enough
Macron gambles on snap French election after Le Pen victory in EU vote
Competition in the housing market is cooling off. Here’s why
The Federal Reserve holds interest rates steady — here’s what that means for your money
Munis firmer ahead of $7.2B new-issue calendar