JPMorgan Chase’s analysts have said that bitcoin price will decline to the $25,000 level before longer momentum will signal capitulation.
They expect the cryptocurrency market to soon begin the process of healing, but expect further sell-offs before capitulation.
Bitcoin price stood at $36,343.15 at 3:43 pm on Tuesday, according to CoinMarket.
According to news.bitcoin.com, the analysts, including Josh Younger and Veronica Mejia Bustamante, recently wrote about the outlook of the cryptocurrency market in a note.
They explained that the near-term outlook for the crypto market was “challenging,” noting that blockchain data suggested recent cryptocurrency sell-offs were made to cover losses.
“There is likely still an overhang of underwater positions which need to be cleared through the market,” they said.
They also warned of the possibility of increased production costs of BTC as China’s continued crackdown pushes bitcoin mining abroad.
Bitcoin’s cost of production is historically tied to its price, several analyses have shown. So, a price bump in the cost of mining may have a booster effect on bitcoin price.
However, they see stability in the bitcoin futures market as a positive factor. The note suggests that the cryptocurrency market appears to be at the beginning of a healing process but is not quite healthy yet.