Bitcoin and the global cryptocurrency market have been going through a bearish phase, with Bitcoin falling as low as $25,600. However, despite the discouraging scenario, experts at JP Morgan are optimistic and see the current devaluation as just a short-term correction.
A recent report from the US bank underscores this positive outlook, indicating that the correction and sell-off periods in the cryptocurrency markets are likely to have come to an end this month.
Sentiment is bolstered by CME Bitcoin futures data, which is used by the financial institution to support the bullish forecast.
JPMorgan predicts a bullish course for Bitcoin
JPMorgan has evaluated CME Bitcoin futures positions and concluded that the closing of long positions appears to be at the end rather than the beginning of the phase.
Confidence in the market was boosted by several factors, such as the legal decision on XRP, the launch of PayPal’s stablecoin, and the expectation that the US Securities and Exchange Commission will approve Bitcoin Exchange-Traded Fund (ETF) filings.
Nikolaos Panigirtzoglou, an analyst at JPMorgan, noted: “The demise of previously positive news triggered a wave of sell-off that is still being felt today. However, we expect the cryptocurrency markets to have a limited negative impact in the near term.”
Data shows that open interest for CME Bitcoin futures currently stands at $1.97 billion, after peaking at $3 billion in July.
Moving on, JPMorgan said the SpaceX news of Elon Musk selling his share of bitcoin in the previous quarter acted as a “further catalyst for the correction in the cryptocurrency markets.”
A striking point is the drastic reduction in the supply of Bitcoin on exchanges. According to data from Santiment, only 5.8% of total bitcoins are stored on exchanges. This is the lowest percentage of the past six years, looking back to the fiery times of December 17, 2017.
Such a shift reflects growing confidence in Bitcoin as a robust store of value. More and more holders are choosing to transfer their bitcoins to personal wallets, reducing availability for sale and alleviating downward pressure on the price.
Moreover, Santiment also revealed that Bitcoin remains the asset with the highest address engagement. There have been no less than 963,400 daily active addresses in the past 30 days.
While Bitcoin is trading at $26,097.37, down 1.33% in one day, current trends suggest that the fate of the coin could very well change in the near future.
Source: Live Coins
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
