1. Market Wrap: Bitcoin Bounces to $54K as Ether Fees Drop Below Average in Past Week
Bitcoin’s recovery may spark momentum that should persist this week, said one trader.
The price of bitcoin headed towards bearish territory Sunday before bouncing. Ether’s average fees have dropped over the past seven days, creating a potential trading advantage for some.
Bitcoin (BTC) trading around $54,076 as of 21:00 UTC (4 p.m. ET). Gaining 9.2% over the previous 24 hours.
Bitcoin’s 24-hour range: $47,272-$54,340
BTC above the 10-hour but and 50-hour moving average on the hourly chart, a bullish signal for market technicians.
Bitcoin jumped Monday, reaching as high as $54,340. It was a powerful reversal after prices fell as low as $47,272 around 23:00 GMT (6 PM ET) Sunday.
The largest cryptocurrency was changing hands around $54,076 as of press time.
2. JPMorgan to Let Clients Invest in Bitcoin Fund for First Time
The JPMorgan bitcoin fund could roll out as soon as this summer, sources tell CoinDesk. NYDIG will be the fund’s custody provider.
JPMorgan Chase is preparing to offer an actively managed bitcoin (BTC, +3.68%) fund to certain clients, becoming the latest, largest and — if its CEO’s well-documented distaste for bitcoin is any indication — unlikeliest U.S. mega-bank to embrace crypto as an asset class.
The JPMorgan bitcoin fund could roll out as soon as this summer, two sources familiar with the matter told CoinDesk. Institutional bitcoin shop NYDIG will serve as JPMorgan’s custody provider, a third source said.
JPMorgan’s bitcoin fund will be actively managed, multiple sources told CoinDesk. That’s a notable break from the passive fare offered by crypto industry stalwarts like Pantera Capital and Galaxy Digital, which let well-heeled clients buy and hold bitcoin through funds without ever touching it themselves. Galaxy and NYDIG are now offering bitcoin funds to Morgan Stanley clients.
The JPMorgan fund will be for private wealth clients, a source familiar with the situation told CoinDesk.
3. Tesla Sold Bitcoin in Q1 for Proceeds of $272M
Elon Musk’s electric vehicle company purchased $1.5 billion in BTC in February.
Tesla sold some of its bitcoin (BTC, +3.69%) stash in the first quarter for $272 million in proceeds.
The sale trimmed Tesla’s position by 10%, Tesla CFO Zach Kirkhorn said on an earnings call Monday.
In the slide deck accompanying the company’s first-quarter earnings results Monday, Tesla mentioned the sale of some bitcoin:
Elon Musk’s electric vehicle company purchased $1.5 billion worth of bitcoin in February.
Kirkhorn said on the call that Tesla invested in bitcoin to earn yield on its excess cash in a low-interest-rate environment.
4. A Year After Coronavirus Meltdown, Few Investors See Risk of Deflation: Deutsche Bank
Inflation remains a key focus, according to a survey of global investors, although risk of a “Fed taper” appears low.
Think back to April 2020, when coronavirus-related lockdowns were hitting the global economy hard, and only the most sanguine optimists — and politicians — saw any likelihood of a rapid reopening and rebound.
At that point, the risk of deflation loomed large in the minds of many investors because of the steep drop-off in consumer demand. Prices for bitcoin, (BTC), seen by some cryptocurrency traders as a potential hedge against inflation, stagnated below $10,000, even though central banks around the world were printing trillions of dollars of fresh money.
A year later, the mentality has changed radically: With vaccines rolling out and economists now projecting a buoyant recovery, four in five investors see inflation as far more likely than deflation, according to a new survey by German lender Deutsche Bank.
It’s the second month in a row investors have logged such an overwhelming position, and so the idea appears to be sticking. Perhaps not coincidentally, bitcoin prices are now over $50,000.
“A vast majority (81%) agree that inflation is more likely after the pandemic while only 10% thought we would see deflation,” according to Deutsche Bank. The survey was conducted earlier this month and covered about 700 global investors.
Some 43% of investors responded that higher-than-expected inflation and rising bond yields pose the biggest risks to market stability, according to Deutsche Bank.
Most respondents see U.S. inflation averaging above the U.S. Federal Reserve’s long-term target of 2%, but remaining under 3%.
About 61% respondents saw no risk of major market convulsions this year due to any plans by Federal Reserve officials to taper their asset purchases of $120 billion per month.
In 2013, a Federal Reserve-induced “taper tantrum” sent traditional markets into a tizzy.
Some 21% said a taper tantrum would happen this year, while 18% said they didn’t know.
5. Blockchain Data May Have Foreshadowed Monday’s Bitcoin Price Rally
The SOPR indicator, which measures aggregate net profit/loss could signal a BTC market bottom, according to Glassnode data.
Bitcoin was soaring on Monday and, based on an analysis of blockchain data, the price move may have been weeks in the making.
The “spent output profit ratio” (SOPR), a blockchain data metric that measures the net profit/loss position of outstanding bitcoin (BTC), had approached levels that typically precede price rallies, according to Glassnode, a cryptocurrency analytics firm.
The SOPR dipped below a reading of 1 last week, precisely the level that typically leads to a reversal of a market drawdown, according to Glassnode.
SOPR is used to predict trend reversals by measuring the realized value of the price of BTC sold versus the original purchase price in dollars.
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April 27, 2021