Bitcoin could be at risk of a further drop unless it breaks above $40,000 soon, according to JPMorgan Chase & Co. strategists. An exodus of trend-following investors could hurt the leading cryptocurrency unless it can “break out” beyond that price level.
Traders searching for clues about investor appetite for risk have been gripped by Bitcoin’s mammoth winning rally and turbulent 11% slide from a record of almost $42,000 on Jan. 8. Since March, the cryptocurrency boom embodies the ebullience in financial markets awash with the stimulus to counter the global pandemic’s impact.
Bitcoin proponents argue that the cryptocurrency is maturing as a hedge for dollar weakness and the possibility of faster inflation as the global economy recovers.