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As the asset’s value has fallen for much of this week, JP Morgan has recently stated that Bitcoin is still overbought despite the ongoing correction. In fact, Bitcoin Spot ETF inflows have slowed down this week. Furthermore, fund outflows from investment vehicles have increased significantly over that same period.
The bank said the asset could see profit-taking continue in the Bitcoin halving event. Currently, the asset is down more than 4% in the last 24 hours according to CoinMarketCap. Subsequently, its price of $64,285 is a far cry from the $73,000 mark it reached in early March.
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JP Morgan Says Bitcoin Selloff May Be About to Continue
Over the past week, a number of digital assets have seen their prices decline in value. Following a massive rally led by Bitcoin, a market-wide correction is underway. BTC has been leading the way on that too, with the asset falling more than 4% in the last seven days.
However, JP Morgan believes that the BTC sell-off may not end as, according to the bank, Bitcoin is still overbought. Specifically, in a report first published by CoinDeskAnalyst Nikolaos Panigirtzoglou analyzed the asset’s current place in the market and its short-term prospects.
“There remains considerable market optimism about the prospect of prices rising significantly by the end of the year,” the bank said. “With a major component of that optimism arising from the view that demand for bitcoin through spot exchange-traded funds (ETFs) would continue at the same pace even as bitcoin supply declined following the halving event “.
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However, the bank notes the decline in inflows those ETFs have faced. Additionally, output data has increased this week. “This challenges the notion that the Bitcoin ETF spot flow landscape will be characterized as a sustained unidirectional inflow,” the bank wrote.
The bank later said that “profit-taking is more likely to continue” after the halving. Furthermore, they noted that the asset remains overbought amid the ongoing correction. The sentiment certainly casts doubt on hopes for asset performance post-halving.
The event is currently scheduled for next month. Specifically, Bitcoin Halving Countdown projects the event to take place on April 20. The position of Bitcoin’s value will then be an important point of observation.