Would JP Morgan’s Stock Strategy Work with Crypto Ecosystem?

According to JP Morgan, the Covid-19 pandemic took everybody with a storm, but the crypto stock market made a quick recovery.

By · Aug 12, 2020 . 6min read

JP Morgan in Crypto

Crypto and stock markets exploded, creating a panicky situation for the users when Covid-19 spread globally. The stock market collapsed, resulting in a chaotic situation across the world of finance. Bitcoin trending, collapsed at $3,800 owing to the pandemic. The Covid-19 pandemic took everybody with a storm; however, the crypto market and the stock market made a quick recovery.

With one in every five small and midcap stocks still down more than 30% since the beginning of the coronavirus crisis, it has “never been easier to make money,” according to JPMorgan’s Global Head of Small and Midcap Equity Strategy Eduardo Lecubarri. He anticipates that stocks will recover and trend soon. Mid-cap companies are those with capitalization between $2 and $10 billion, while small-cap corporations have between $300 million and $2 billion. Earlier JPMorgan’s strategists said they found bitcoin’s market structure to more resilient than those of currencies, equities, and, Treasuries. 

Great Rotation in Stock and Crypto Market

Traders favour trade a trending market, as it frequently moves in one direction, and the retracements allow low-risk entry opportunities. This is because a trade that follows the dominant trend has a higher possibility of earning profits than in a volatile market. The derivatives market also becomes active when the underlying market trends. Thus, allowing professional traders leverage to earn quick profits using the futures and options route. This is known as great rotation.

Bitcoin and altcoins go through their cycles. It is frequently evident when Bitcoin trends, altcoins dips, and vice versa. According to the data from Trading View, the bulls are endeavouring to push Bitcoin above the overhead resistance of $11,543.0, which is a positive sign. This implies that the bulls are not maintaining profits yet. It frustrates the traders who have been blown because they are overpowered to purchase at higher levels.

Bitcoin price

Conclusively, JPMorgan has come a long way in its recognition of bitcoin. In September 2017, CEO Jamie Dimon called bitcoin a “fraud,” only to regret saying it a few months later. Now JPMorgan Chase is even offering banking services to bitcoin exchanges, Coinbase and Gemini. Additionally, earlier, the company agreed to pay $2.5 million to settle a class-action lawsuit for overcharging fees for crypto transactions.

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