Morgan Stanley strategists indicate that the cryptocurrency market has entered the “fall season” of Bitcoin’s four-year cycle, encouraging investors to secure their profits before a potential winter phase arrives.
In a podcast episode titled Crypto Goes Mainstream, Denny Galindo, an investment strategist at Morgan Stanley Wealth Management, noted that historical trends reveal a reliable pattern of three price increases followed by one decrease in Bitcoin’s market cycles. Galindo advised investors to realize gains in preparation for a possible crypto winter.
“We are currently in the fall season,” he stated. “Fall is when we harvest. This is the time to take your gains. The question remains how long this fall will continue and when the next winter will commence.”
The “harvest” analogy illustrates that prominent Wall Street leaders are acknowledging Bitcoin’s market patterns within a cyclical investment framework, akin to commodities or liquidity-driven macroeconomic cycles.
Bitcoin dip signifies a “technical bear market”
On Nov. 5, Bitcoin (BTC) dipped below $99,000, crossing a crucial macro benchmark and reigniting discussions about the market’s condition. This drop placed BTC under its 365-day moving average, as per CryptoQuant’s head of research, Julio Moreno.
Bitcoin’s 365-day moving average serves as a technical indicator that generally signifies the market’s overall trend. Analysts assert that this metric is among the most critical indicators of market sentiment. The decline was largely interpreted as a significant bearish sign.
Bitrue research analyst Andri Fauzan Adziima previously indicated to Cointelegraph that this decline “officially marked a technical bear market.”
In addition to last week’s Bitcoin dip, crypto market-maker Wintermute reported that key factors influencing the market’s liquidity have stagnated.
In a blog post, Wintermute explained that stablecoins, ETFs, and digital asset treasuries (DATs) have been primary sources of liquidity in the crypto market. The firm noted that liquidity inflows from all three areas have reached a standstill.
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Institutional investors still see Bitcoin as a macro hedge against inflation
Despite the continued volatility of BTC, institutional investors maintain a positive outlook.
Michael Cyprys, head of US brokers, asset managers, and exchanges at Morgan Stanley Research, stated in the podcast that, despite fluctuations, institutional investors are increasingly considering Bitcoin as a vital part of diversified portfolios.
“Some institutional investors regard Bitcoin as digital gold or a macro hedge against inflation and currency debasement,” Cyprys remarked, adding that ETFs have facilitated easier access. “However, that perspective has sparked debate within the market.”
He further explained that institutional allocations typically evolve more slowly, as large investors are unable to quickly adjust investment approaches or portfolio balances due to internal processes, risk committees, and long-term commitments.
Nonetheless, he mentioned that adoption is on the rise as regulations and ETF frameworks have reduced entry barriers. Cyprys highlighted that spot Bitcoin and Ether ETFs have attracted billions in assets under management (AUM).
According to SoSoValue data, US spot Bitcoin ETFs currently hold total net assets exceeding $137 billion, while spot Ether ETFs account for $22.4 billion.
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This article does not provide investment advice or recommendations. Every investment and trading action carries risk, and readers should conduct their own research before making a decision.
