- Large investors have increasingly turned their attention away from Bitcoin and towards Ethereum
- Institutional investors avoid the Bitcoin futures market, say JP Morgan analysts
- With investors increasingly flocking to Ethereum, the recent downturn in futures has been bad for Bitcoin
Since August, institutional investors have started shifting their attention away from Bitcoin and towards Ethereum, the second largest cryptocurrency by market capitalization. According to JPMorgan analysts, the leading digital asset took a hit when BTC futures traded below the actual price of the crypto asset.
Ethereum vs. Bitcoin
Large investors have increasingly turned their attention away from Bitcoin and towards Ethereum. BTC futures on the Chicago Mercantile Exchange have traded below the real price of the leading cryptocurrency, lowering expectations for the best digital asset.
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According to JPMorgan, the trend seems to be that institutional investors are avoiding the Bitcoin futures market, suggesting a setback for the leading cryptocurrency and low demand.
Due to the high storage costs for Bitcoin, futures tend to be traded at a premium to real Bitcoin when there is normal, healthy demand. According to research by JPMorgan, the returns offered on passive Bitcoin investments also drive futures prices.
Bitcoin futures allow investors to bet on the future price of the leading digital asset and trade contracts based on that price. With investors increasingly flocking to Ethereum, the recent downturn in futures has been bad for Bitcoin. According to CME data, the average 21-day premium for ETH futures has increased to 1% compared to the spot ether prices. This event showed a significant drop in demand, according to JPMorgan.
Bitcoin’s prices are a major concern
With BTC continuing to make lower lows, Bitcoin price is struggling to make higher highs. Despite the fact that buyers got in at $ 39,611 after the recent loss, the leading cryptocurrency has been hit by a top signal, suggesting that further decline is possible.
On the 4-hour chart, the descending diagonal trendline has caught Bitcoin price in a dip. The Momentum Reversal Indicator (MRI) has printed a top signal, suggesting that BTC is threatened with further decline.
The 61.8 percent Fibonacci retracement level at $ 44,006 is the first resistance level for Bitcoin price. BTC will find more support at $ 43,842, the 20-hour Simple Moving Average (SMA). Another mainstay could emerge at $ 41,906, which is the MRI’s support line.
If Bitcoin’s price rises due to increased buying pressure, the next resistance level will be at $ 45,815, where the 50 4-hour and 100 4-hour SMAs intersect. At $ 46,947, the downward sloping diagonal trendline will be the next challenge for BTC. At the time of writing, the price of Bitcoin is $ 44,715.62 and the trading volume is recorded at $ 32.07.