JPMorgan Analyst Believes Bitcoin Needs To Regain $60,000 Level Fast Otherwise It'll Collapse

Bitcoin BTC/USD is in for a major correction if it does not break above $60,000 soon, according to JPMorgan strategist Nikolaos Panigirtzoglou.

What Happened: JPMorgan strategists led by Panigirtzoglou wrote in a note Tuesday that Bitcoin's momentum will collapse if it does not regain $60,000 soon.

Panigirtzoglou stated that "over the past few days Bitcoin futures markets experienced a steep liquidation" like last February, middle January, or the end of November.

The remarks follow this Sunday's 9% correction, which according to some experts, was caused by news of a power outage in China wiping out a considerable portion of the network's hashrate.

Why It Matters: In the months cited above, Bitcoin's flow impulse was strong enough to allow the cryptocurrency to recover above key technical levels, which resulted in momentum traders further building up their long positions.

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Because of this, the JPMorgan strategist believes that the uptrend will be weakened if Bitcoin does not regain the key $60,000 soon.

“Momentum signals will naturally decay from here for several months, given their still elevated level,” he wrote.

While Panigirtzoglou admitted that it remains to be seen whether this time Bitcoin recovers as it did after the aforementioned corrections, it is less likely since this time momentum decay seems more advanced and thus more difficult to reverse.

Price Action: BTC is currently trading under its 50-day moving average around of $54,204, 5.31% lower over the past twenty-four hours.

See also: Bitcoin Could Fall As Low As $20,000, According To Guggenheim's CIO

If the coin does not breach this short-term trend line, it could lose another 10% and test the $50,000 level.

The next support area would be the 100-day moving average at $49,212, 11% lower than Wednesday's price.