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The mania that propelled crypto assets to new highs seemed to have subsided. Despite the fact that Coinbase Global Inc. went public last week, Bitcoin fell in the markets. The world’s largest cryptocurrency fell as much as 15% on Sunday, just days after hitting a high of $64,869. It later recovered some of its losses and was trading at about $56,440 at the time of publication.
Following this drop, several detractors voiced their displeasure with Bitcoin’s lack of traction.
In his most recent article, JP Morgan strategist Nikolaos Panigirtzoglou examined the digital asset’s data. According to the legendary strategist, Bitcoin’s surge could be coming to an end due to the cryptocurrency’s diminishing urge. He quoted $60,000 as the central point of reference for Bitcoin bulls as the “make or break” mark.
“If the largest cryptocurrency isn’t able to break back above $60,000 soon, momentum signals will collapse”
He further added:
“Over the past few days Bitcoin futures markets experienced a steep liquidation in a similar fashion to the middle of last February, middle of last January, or the end of last November, momentum signals will naturally decay from here for several months, given their still-elevated level.” the strategists said.
Looking at the three examples he listed, it is interesting to notice that the overall flow push was sufficient to enable Bitcoin to rapidly break beyond the main thresholds, resulting in more position growth by momentum traders.
Panigirtzoglou, on the other hand, remained critical this time. He said, ”
“Whether we see a repeat of those previous episodes in the current conjuncture remains to be seen, the likelihood it will happen again seems lower because momentum decay seems more advanced and thus more difficult to reverse, flows into Bitcoin funds also appear weak.” the strategists said.
In complete contrast, Bill Miller, Hedge Fund legend cited his optimism regarding bitcoin in a recent interview on CNBC’s “The Exchange”. He stated:
“Supply [of bitcoin] is growing 2% a year and demand is growing faster. That’s all you really need to know, and that means it’s going higher.”