(Kitco News) - Sentiment and momentum appear to be turning for Bitcoin as some see its recent selloff as a buying opportunity.
In a note published last week, market analysts at JPMorgan Chase said that the leading digital currency is well below its fair value and there is "significant upside" from current prices.
Although U.S. markets are closed for the Memorial Day long weekend, cryptocurrencies have been active, albeit with lower activity. Bitcoin is seeing a positive start to the week as prices push above $30,000 per token.
The rally comes as prices dropped briefly below $29,000 an ounce last week. The bitcoin selloff has pushed prices down nearly 60% from their November highs. Bitcoin has seen nine consecutive weeks of losses.
In its note, analysts at JPMorgan said that bitcoin is undervalued by around 28%.
"The past month's crypto market correction looks more like capitulation relative to last January/February, and going forward, we see upside for Bitcoin and crypto markets more generally," Nikolaos Panigirtzoglou, market strategist, wrote on Wednesday.
JPMorgan sees bitcoin prices pushing back to $38,000 a token.
Marcus Sotiriou, an Analyst GlobalBlock, a UK-based digital asset broker, said that bitcoin needs to hold ground above $29,000 to attract new capital.
"Relief has been long overdue in the crypto market, as the U.S. stock market already rallied last week, after Jerome Powell's speech that gave the market clarity on their plans to carry out a soft economic landing," he said in a note.
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Analysts note that last week's 6% rally in the S&P 500 could also create some traction for bitcoin as risk sentiment returns to the marketplace. However, other strategists have described the recent jump in equity markets as a classic bear-market rally. These analysts have also said that growing recession fears could weigh on investor sentiment.
