JPMorgan predicts the end of the fall of the crypto market in the near future
Analysts at JPMorgan investment bank predicted the end of the bear market in the field of cryptocurrencies, as well as the fact that digital assets will subsequently begin to consolidate. The head of the analytical department, Nikolaos Panigirtzoglou, believes that a significant part of investors with margin positions have already left the market.
“Indicators like net leverage say that deleveraging is already at an advanced stage,” he said.
Crypto market capitalization has lost almost $2 trillion from November 2021 highs. Currently, this figure has fallen below the $1 trillion mark. Therefore, we can conclude that the period of reducing the percentage of borrowed funds is already coming to an end.
“The current cycle is unlikely to drag on, given that cryptocurrency companies with large reserves of funds are already starting to reinvest. This will hold back the falls. Venture capital companies also took a good pace of investment in the industry in May and June,” JPMorgan noted.
And Fundstrat analyst Mark Newton does not agree that the main crypto coin is already on the threshold of the bottom. According to him, in the short term, the price of bitcoin can fall to $13,000. And this level can become a signal for medium-term investors to enter the market.
Earlier, Arcane Research experts compared BTC drawdowns in previous market cycles. They concluded that there is a possibility of a depreciation of the main cryptocurrency to the level of $10,350.
“During its 13-year history, bitcoin has gone through several boom and bust cycles. The current 222-day drawdown of 73% may seem painful. However, hodlers were tested much harder in 2013 and 2017,” the analysts said.
According to them, after the peak at the end of 2013, the price of bitcoin hit the bottom, falling by 85% over 407 days. Also, the bearish sentiment that followed the $20,000 level in December 2017 was similar in its characteristics. In almost 12 months, BTC has fallen in price by 84%.
“If bitcoin follows the trajectory of these cycles, the bottom may be reached somewhere in the end of the fourth quarter of 2022 at around $10,350,” Arcane Research said earlier.