JPMorgan analyst warns in the latest research report released on Thursday that Bitcoin is still in the “overbought zone” and predicts a downward trend after the halving.
Bitcoin’s fourth halving is expected to occur on April 20th, 9 am. However, recently, with the dampening of expectations for interest rate cuts by the Federal Reserve and escalating tensions in the Middle East, bearish voices have also emerged.
For example, earlier at around 10 am, after news broke that Israel launched a missile attack on Iran, Bitcoin plummeted to $59,600, a drop of nearly 6.4% within four hours. As of the time of writing, it temporarily reported $61,758.
JPMorgan: Bitcoin will drop after the halving
Currently, there are different views on the future trend of Bitcoin after the halving. According to Coindesk, JPMorgan, one of the largest commercial banks in the United States, expects a downward trend for BTC after the halving. They believe that BTC is still in the “overbought zone” based on the analysis of open interest contracts for Bitcoin futures.
Similarly, analysts from Deutsche Bank also predict that Bitcoin will not rise after the halving but will remain at high levels, as the price of Bitcoin has already priced in the positive expectations of the halving event.
Data indicates that the funding rate for BTC turned negative and reached its lowest level in over six months on April 15th and April 18th. This indicates a decrease in bullish interest, and Bitcoin’s price dropped by 13.5% between April 12th and April 18th.
Note: A negative funding rate means that there are more short positions than long positions, and bears have to pay the funding rate to bulls. It is considered a highly bearish indicator.
Traders on X also analyze that the downward trend of Bitcoin may continue until early June. “Bitcoin’s closing price yesterday was below the 50-day moving average and below the low point on March 20th, confirming its mid-term high on March 14th. The low point may occur around June 5th.”
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