JP Morgan analysts said they expect a strong Bitcoin (BTC) rally. Here’s when the next bull will start, according to the investment giant.
JP Morgan expects strong Bitcoin rally
Due to unfavorable macroeconomic conditions, the cryptocurrency market has been stagnant for a while. CPI data show that the Fed’s hawkish stance is insufficient to significantly reduce inflation. As a result, the central bank is likely to take a very hawkish stance forward. However, financial services giant JP Morgan expects a strong rally in risky asset markets like cryptocurrency.
Bitcoin has recorded more than 13% in the last seven days. It is currently trading well below the $20,000 psychological level. After the merge was completed, Ethereum also continued to decline. After outperforming Bitcoin in recent months, this time it has fallen behind by 20%. As a result of the bleeding of the leading cryptos, the entire altcoin market has been hit hard.
Bottom very near for risky assets and stock market, according to JP Morgan
JP Morgan Global Head Marko Kolanovic reveals that the market is in an uptrend. Kolanovic bases his optimism on the company’s earnings performing better than expected. The market will benefit from low investor positioning in the long run.
Marko predicts that the Fed will maintain its hawkish stance. He heavily expects the Fed to raise interest rates by 75 basis points at its meeting tomorrow. He also believes that an increase of 100 basis points is inevitable in the future. However, he said, “firmly fixed long-term inflation expectations” will keep the market from falling further.
Here is the date JP Morgan predicted for the Bitcoin rally
JP Morgan Chairman Kolanovic predicts that the Fed will begin lowering interest rates in early 2023, bolstering the stock market. It reveals that a strong rally could follow.
Jim Cramer, a popular CNBC analyst, said that inflation hurt stocks and company earnings. However, given the low positioning of most traders, any good news will be the catalyst for a rally.
What will the Fed’s decision be?
The Fed will decide on the next rate hike at its FOMC meeting tomorrow. While the CME Fed Watch tool predicts a 75 bps increase, crypto analysts like Michael van de Poppe believe a consensus has formed around a 100 bps increase.
#Ethereum looking at weakness here, as it lost upwards trending structure.
Expecting a response from the region between $1,200-1,300.
Not sure whether we'll get a bounce towards $1,425 as FED on Wednesday is most important as a decider of a trend. pic.twitter.com/BZ7RaaEdqT
— Michaël van de Poppe (@CryptoMichNL) September 19, 2022
Poppe, who you follow on Kriptokoin.com, said that the Fed meeting is critical for the trend of the cryptocurrency market. In his September 19 analysis of Ethereum, he noted that the short-term bounce is uncertain:
We are not sure if we will make a jump towards $1,425 on Wednesday as the FED is crucial as a trend setter.
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