JPMorgan: Bitcoin futures are oversold, and gold is expected to reach $8,500.

JPMorgan states that momentum indicators show Bitcoin futures are oversold, while gold and silver futures are overbought, reflecting large holdings of precious metals by institutions and momentum traders. The bank also notes that since August, retail investors have shifted from Bitcoin to gold and silver, and points out that, based on increasing allocations by private investors and central banks, the long-term price outlook for gold is between $8,000 and $8,500 per ounce. JPMorgan analysts issue a stern warning to the commodities futures market, indicating that Bitcoin futures have entered oversold territory, while gold and silver futures are in overbought territory. This shift reflects a general preference among retail and institutional investors for precious metals over Bitcoin. Hedge funds have been actively building silver long positions from late 2025 to early 2026, with similar trends in gold over the past year, whereas Bitcoin futures have not shown comparable growth. This divergence is evident in momentum indicators tracking trend traders (such as commodity trading advisors). Gold futures are overbought, silver is severely overbought, and Bitcoin is deeply oversold, signaling potential short-term reversals. Investors are turning to precious metals as a hedge against macroeconomic uncertainty, with industrial demand for silver in renewable energy, artificial intelligence, and photovoltaics amplifying its rally—up over 60% so far in 2026, reaching about $118 per ounce, a 22% increase over gold. Clear Divergence Between Silver, Gold, and Bitcoin Analysts point out that gold ETF inflows surged significantly in Q4 2025, with total inflows approaching $60 billion by year-end. They also add that most silver ETF inflows occurred in Q4 2025, coinciding with outflows from Bitcoin ETFs, indicating retail investors are shifting from Bitcoin to precious metals. Analysts believe that institutional behavior has reinforced this shift. Using Chicago Mercantile Exchange (CME) futures open interest changes as a metric, institutional futures positions show a substantial increase in silver long holdings from Q4 2025 to early 2026, mainly driven by hedge funds. Over most of the past year, gold futures also experienced similar growth in holdings. In contrast, analysts note that Bitcoin futures positions have not seen similar growth over the past year. Using momentum indicators to gauge trend-following traders (such as commodity trading advisors), the results show a clear divergence among the three assets. Analysts point out that gold futures are overbought, silver futures are currently severely overbought, and Bitcoin futures are oversold. They add that this positioning increases the risk of recent profit-taking or mean reversion in gold and silver. In fact, both silver and gold prices have recently retreated from their highs. Analysts also highlight structural differences in liquidity among these assets using the Hui-Heubel ratio (a measure of market breadth and liquidity). Gold’s ratio has remained consistently lower, indicating stronger liquidity and higher market participation. Silver’s ratio is higher, reflecting weaker liquidity. Analysts say that recent declines in silver market breadth may have exacerbated recent price volatility. Bitcoin’s Hui-Heubel ratio is the highest among the three, indicating lower liquidity and greater sensitivity to smaller order flows. Despite short-term risks facing precious metals, analysts remain optimistic about gold’s long-term prospects. They state that both private investors and central banks are increasing their allocations to gold. JPMorgan Maintains Optimism on Gold’s Long-Term Outlook JPMorgan expects gold prices could reach $8,000 to $8,500 per ounce in the coming years, supported by central bank diversification, currency devaluation concerns, and ongoing demand in Asia. Additionally, analysts reaffirm that if investors continue to replace long-term bonds with gold as a hedge against stocks, the allocation of private investors to gold could rise from just over 3% currently to about 4.6%. Under this scenario, they believe the theoretical range for gold prices could reach $8,000 to $8,500 per ounce. However, cautious sentiment is widespread: former JPMorgan analysts and companies like Société Générale warn that the precious metals market is severely overbought, mainly driven by “FOMO” (fear of missing out) speculation rather than fundamentals. Silver is called the “Cinderella” of metals, with a 50% risk of collapse within a year due to high prices potentially being addressed by increased supply to resolve shortages. The poor performance of Bitcoin highlights its dilemma as “digital gold,” with the Bitcoin-to-silver ratio dropping to 700-800, a level historically indicating Bitcoin oversold or silver overbought. While institutions stabilize prices by holding Bitcoin, it lacks the five-thousand-year consensus and central bank appeal of gold. Traders are watching for a rebound in Bitcoin from oversold levels, but amid global volatility, precious metals still dominate.