As investors and other stakeholders grapple with the massive dip in the global market across different asset classes, many have begun dumping their holdings. However, financial giant, JPMorgan sees this as the market tilting towards a “buy the dip” opportunity.
Bitcoin’s Dramatic Fall and Rebound
As per data, Bitcoin crashed to $49,513 in a rapid decline that took market speculators unaware in earlier trading. Although the digital asset has witnessed mild rebound, Bitcoin price remains at $54,579.17 based on CoinMarketCap figures.
Despite this massive drop in Bitcoin price and the selling pressure it triggered, JPMorgan sees the silver lining in the market horizon. According to the banking giant, the rotation in the tech sector has almost been concluded, as such, investors should look out for a “tactical” buy the dip window.
JPMorgan’s Tactical Positioning Monitor
John Schlegel, JPMorgan’s head of positioning intelligence maintains that signals from their Tactical Positioning Monitor shows further dip in prices of assets remain a possibility in the next couple of days. Meanwhile, the likelihood of a strong rebound would depend on future macro data.
As per Bitcoin, the world’s leading digital currency crashed below the $50,000 level two consecutive times within a 12 hour period as investors rallied. Within this time frame, data from Coinglass revealed that over $40 million worth of Bitcoin in short positions got liquidated in the midst of the strong reversal. Some have put total short liquidations within this period at over $56 million.
Despite these liquidations, some stakeholders have maintained their holding stance. Notably, MicroStrategy falls in this category as its chairman, Michael Saylor recently emphasized his decision to HODL his Bitcoin with diamond hands.
Broader Financial Market Turmoil
Meanwhile, in the broader financial market, Nasdaq sank by about 5% in the early trading hours of August 8 as the U.S. Federal Reserve called for an emergency meeting. This followed a 13% crash in the Japanese market which triggered global market uncertainty and impact in other sectors.
Many market experts speculate that the meeting might likely end with a resolution for the U.S. Fed to intervene in the market. Ordinarily, there has been anticipation of a rate cut by the authorities in September. However, an intervention before then has not been ruled off. How this will impact the market remains uncertain.
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