Analysts at JPMorgan are feeling more positive about Bitcoin now that it is going into the fourth quarter of 2024 and showing strong upward trends. The analysts released a report on Monday, citing October’s past success as a major reason for their optimism. They called the month a possible turning point for the cryptocurrency market.
Bitcoin has increased over 70% of the time in a good month. Analysts have given this trend the unofficial name “Uptober,” which comes from the fact that bitcoin prices tend to go up during this time. In its study, JPMorgan drew attention to this trend and said it might affect how investors act this year as well.
Bitcoin Past Trends May Impact October Market
Analysts agreed that past performance isn’t always a favorable predictor of future performance, but they think that the previous trend could still have an effect on how the market moves this October. The study said, we think the popularity of ‘Uptober’ may change people’s behavior and lead to a good month for bitcoin this year.
In addition to the record set in October, the report concentrated on several macroeconomic factors that could contribute to the sustained growth of bitcoin. The effect of the recent interest rate cuts by the U.S. Federal Reserve was a major part of their study. Lower rates, according to JPMorgan, typically benefit the crypto market by encouraging more people to buy, sell, and take risks.
Experts said that, despite a rate cut on September 18, the anticipated “pop” in cryptocurrency prices has not yet occurred. Experts speculated that the distinct nature of the crypto market, compared to traditional financial assets, and its relative youth may have contributed to the delay.
They claim that there weren’t many crypto assets available until the early to mid-2010s, and rates were nearly zero for the majority of their lives. It’s possible that these markets will do best with steady rates instead of just low ones.
Analysts think that more rate cuts could give bitcoin and the cryptocurrency market as a whole the boost they need in the future. They were cautiously optimistic, though, because they knew that macro issues would still have a significant effect on how the market did in the future.
Blackrock’s Impact on Bitcoin and Cryptocurrency Landscape
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In its study, JPMorgan also talked about recent changes in the cryptocurrency ecosystem, such as Blackrock’s decision to allow options trading on its spot exchange-traded fund (ETF). Analysts were positive about this change’s possible effects, saying that allowing options trade could make the market more liquid and structured.
The study says that options have given investors more ways to deal with the ETF and made the base asset more liquid. If this new level of investment complexity helps attract both institutional and individual buyers, the price of bitcoin could go up even more.
The study talked about more than just bitcoin. It also talked about changes in the wider cryptocurrency world, like Ethereum’s Pectra upgrade. The update aims to enhance Ethereum’s network performance, potentially altering its overall functionality.
However, JPMorgan’s analysts were cautious in their assessment, saying that even though Pectra is an important move forward for Ethereum’s structure, it might not have an instant effect on prices. They said, we see this upgrade as more of a structural change than a price catalyst right now.
JPMorgan analysts reiterated their belief that changes in the overall economy are increasingly impacting the cryptocurrency market. Even though they think the market has room to grow, especially bitcoin, they also said that it needs a big push to keep going.
The report said, we continue to see the crypto ecosystem becoming a little more sensitive to big-picture factors. We are eagerly anticipating the next significant advancement that will accelerate growth and simplify the involvement process for retailers, thereby contributing to the long-term growth of ecosystems.
Conclusion
JPMorgan’s analysts are still positive about Bitcoin’s growth potential in the fourth quarter, pointing out that October has always been a favourable month for the cryptocurrency. However, they warn that global factors and the need for a big market catalyst will be crucial to keeping the momentum going. In the coming months, it will be important to see how the market reacts to these changes.
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