The "overbought pullback" alarm is sounding! Bitcoin may face its worst single-week performance in 2024

According to the Zhitong Finance and Economics APP, as the market's interest in the recent global craze for Bitcoin spot ETFs has significantly diminished, the price of Bitcoin has fallen by over 10% from its recent all-time high. JPMorgan Chase strategists warn that the downward trend in Bitcoin may continue in the short term. As Bitcoin prices plummet, the 10 Bitcoin spot ETFs in the US stock market recorded the largest three-day outflow since their listing on January 11th.

The world's largest cryptocurrency, Bitcoin, dropped nearly 5% in the past 24 hours, possibly heading towards its worst-performing week of the year. As of the time of writing, the Bitcoin trading price has fallen by 3.32% to $65,501. JPMorgan Chase strategists stated in a report that from a technical perspective, Bitcoin "still looks overbought," reiterating their prediction from February for further declines in Bitcoin prices. They suggest that stability may occur after the highly anticipated halving event in April, which will reduce the supply of newly minted Bitcoins by miners.

Led by Nikolaos Panigirtzoglou, JPMorgan Chase strategists wrote in a report on Thursday that the continuous decline in open interest in CME Bitcoin futures and the decreasing inflow of funds into ETFs are important bearish signals for Bitcoin prices.

"The net inflow rate of Bitcoin spot ETFs has significantly slowed down, with large-scale outflows occurring in the past week," wrote JPMorgan Chase strategists. "This challenges the narrative of continuous one-way net inflows into Bitcoin spot ETFs. With the halving event approaching, the trend of profit-taking is more likely to continue in the short term, especially against the backdrop of overbought positions. Although there was a certain degree of retracement last week, the 'overbought retracement' signal remains very clear."

Last month, JPMorgan Chase predicted that as the "excitement triggered by the Bitcoin halving subsides significantly," the price of Bitcoin will drop to around $42,000 after April.

Naeem Aslam, Chief Investment Officer at Zaye Capital Markets, recently stated that despite Bitcoin reaching a historical high of $73,798 on March 14th, retail investors' enthusiasm for investment may be waning, with profit-taking becoming more apparent Naeem Aslam stated: "In fact, the recent rise in Bitcoin did not take off from the historical high as before, which has led many to question the ultimate strength of this bull market for Bitcoin." "The Bitcoin halving is approaching, if this event fails to truly sustain the momentum of Bitcoin's price, then we may face a significant pullback, which means the price could potentially drop below $50,000 in the short term."

However, from a long-term perspective, most well-known investment institutions are generally optimistic about the future market of Bitcoin. JMP Securities, a well-known Wall Street investment institution, stated in a research report released last week that it is expected that in the next three years, the Bitcoin (BTC) spot ETF could see inflows of up to $220 billion, which means that if the multiplier is applied to calculate new capital, the price of Bitcoin could double, reaching $280,000.

"Although the inflow of funds into the spot Bitcoin ETF has exceeded our expectations, reaching $10 billion just two months after its launch," analysts at JMP Securities emphasized in the report: "The current level of fund activity and fund flow may still be just the tip of the iceberg." They also added that fund flows are expected to continue to grow significantly, as the formal approval of the U.S. Bitcoin spot ETF is just the beginning of a "longer capital allocation process."

Standard Chartered Bank expects Bitcoin to reach $100,000 by the end of this year; hedge fund SkyBridge predicts that by April 2025, Bitcoin will reach $170,000. Ark Invest, the fund management company approved to launch a Bitcoin ETF, has put forward a long-term bull case, forecasting that the price of each Bitcoin will exceed $1.3 million in the next decade