2024-03-22 03:10:02
Analysts at JPMorgan Chase issued a latest research report on Thursday warning that Bitcoin is still in the “overbought zone” and may fall further. JPMorgan Chase also previously predicted that Bitcoin may fall to $42,000 following the halving due to reduced mining rewards and increased miner production costs.
(Previous summary: Bitcoin ETF has seen net outflows for four consecutive days) BTC fell below 65,000, Ethereum lost $3,500, is the selling pressure over?)
(Background supplement: Bitcoin broke through 68,000! Fed interest rates were frozen for five consecutive years, and Ball announced that he would cut interest rates three times this year. U.S. stocks hit record highs once more)
After hitting a record high of $73,777 on the 14th, Bitcoin continued to fall sharply this week, with the lowest falling below $61,000 on the 20th before rebounding. At the time of writing, Bitcoin was fluctuating at $65,000.
Against this backdrop, JPMorgan analysts released their latest research on ThursdaywarnBitcoin is still in the “overbought zone” and may fall further.
JPMorgan analysts headed by Nikolaos Panigirtzoglou pointed out in the report that judging from JPMorgan’s futures position indicators and the premium of Bitcoin futures prices compared to spot prices, Bitcoin is still overbought, and so far, only a few positions have been closed. :
Despite the sharp correction over the past week, these two indicators suggest that Bitcoin remains in overbought territory.
Basically, the market is optimistic regarding Bitcoin rising before the end of the year. The two biggest reasons are that Bitcoin spot ETFs are expected to continue to bring incremental funds and that the supply of new Bitcoin coins will decrease following the halving. However, analysts at JPMorgan Chase said that the latest data shows that net inflows into spot Bitcoin ETFs have slowed down, challenging the view that funds continue to flow into spot ETFs in one direction.
J.P. Morgan wrote:
In fact, as the halving event approaches, profit-taking is more likely to continue, especially from a positioning background that looks overbought despite the pullback over the past week.
It may fall to 42,000 mg following halving
Bitcoin will usher in a halving of mining rewards in April, when the block reward will drop from 6.25 Bitcoins to 3.125 Bitcoins. JP Morgan analysts previously predicted that due to the reduction in mining rewards and the increase in production costs, the block reward will be reduced. Bitcoin may fall to around $42,000 in the next half.
According to JPMorgan Chase, following the halving, the computing power of the entire Bitcoin network may drop by 20%. The reason is that as the profitability of miners decreases, less efficient miners will decide to exit the mining business, based on $0.05/kW With the average cost of electricity at that time, the estimated median production cost would drop to $42,000.
Bitcoin mining cost and currency price relationship
However, according to recent historydataThe last time the price of Bitcoin was “close to or lower than” the cost of mining occurred at the bottom of the bear market in 2022, when many mining companies closed down as a result. But during a bull market cycle, the price of BTC is usually much higher than the cost of mining.
Although in history, there is usually a small correction following the halving is completed, it may be difficult to say whether it will reach $42,000.
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