Is fading momentum becoming a problem for bitcoin?
JPM notes that the recent liquidation in bitcoin futures has similarities to the liquidations we saw in Feb, Jan and Nov.
They argue that the build up of futures before the liquidation was most likely CTA momentum chasers and crypto funds, and that these have now liquidated positions (note bitcoin is still down post COIN going public).
As we have been mentioning since last week, momentum signals could reverse if bitcoin does not move higher soon, and JPM concludes this today;
"If the bitcoin price fails to break out above $60k soon, the momentum signals will naturally decay from here for several months, given their still elevated level".
The second problem for bitcoin recently is the falling pace into Bitcoin funds. The "delta" is simply not there at the moment.
The technical picture has btc trading below the 50 day moving average and the steep trend since Dec is broken. On the other hand the Fibo 23.6% level stands at around 54k which is an important level to watch to the downside.
Resistance is around the 60k level at the moment.
When looking at the last chart comparing ETH and BTC you realize bitcoin is so 2020.
As a side note, lumber is beating both ETH and BTC on the 1 month chart.
Who is "rational" and what is the "value" play here?
They argue that the build up of futures before the liquidation was most likely CTA momentum chasers and crypto funds, and that these have now liquidated positions (note bitcoin is still down post COIN going public).
As we have been mentioning since last week, momentum signals could reverse if bitcoin does not move higher soon, and JPM concludes this today;
"If the bitcoin price fails to break out above $60k soon, the momentum signals will naturally decay from here for several months, given their still elevated level".
The second problem for bitcoin recently is the falling pace into Bitcoin funds. The "delta" is simply not there at the moment.
The technical picture has btc trading below the 50 day moving average and the steep trend since Dec is broken. On the other hand the Fibo 23.6% level stands at around 54k which is an important level to watch to the downside.
Resistance is around the 60k level at the moment.
When looking at the last chart comparing ETH and BTC you realize bitcoin is so 2020.
As a side note, lumber is beating both ETH and BTC on the 1 month chart.
Who is "rational" and what is the "value" play here?