JPMorgan analysts say that even if the cryptocurrency price bounces from this point on, it is likely to be tactical, temporary and strategic rather than the start of a sustained uptrend. They point out that Bitcoin’s current price of around $67,500 is high compared to its production cost of around $43,000 and the volatility-adjusted price of gold of around $53,000.
JPMorgan analysts said in a report released Thursday that comparing bitcoin prices to gold after adjusting for JPMorgan’s volatility, “indicates that mean reversion is near zero, limiting the upside potential for bitcoin prices in the long term.” The JPMorgan analysts were led by Managing Director Nikolaos Panigirtzoglou.
Analysts have repeatedly stressed that a cryptocurrency rally is expected starting in August as liquidations have decreased since July. They noted that Bitcoin futures have recently been weak due to the liquidations of Gemini and Mt. Gox creditors and the sale of seized Bitcoin by the German government. The analysts expect these liquidations to subside after July and expect Bitcoin futures to rally starting in August, which is consistent with the recent rally in gold futures.
“We believe momentum traders like CTA (Commodity Trading Advisors) played a big role in the gold futures impulse,” the analysts said. “The momentum signal for gold surged into the previous overbought zone in April in July.”
JPMorgan on the possibility of Trump winning a second term
Bitcoin 
Bitcoin
+0.34%
Disclaimer: The Block is an independent media outlet providing news, research and data. As of November 2023, Foresight Ventures is the largest investor in The Block. Foresight Ventures invests in other companies in the cryptocurrency space. Cryptocurrency exchange Bitget is an anchor LP of Foresight Ventures. The Block continues to operate independently to provide objective, impactful and timely information on the cryptocurrency industry. Current financial disclosures include:
© 2023 The Block. All rights reserved. This article is provided for informational purposes only. It is not provided or intended to be legal, tax, investment, financial or other advice.