Morgan Stanley Says It’s Time To Take Crypto Profits — Here’s What Our Data Shows

. Key Takeaways

• Morgan Stanley strategist Denny Galindo says Bitcoin is successful the “fall season” of its four-year cycle, historically the clip to harvest gains earlier a imaginable downturn.

• However, CCN expert Valdrin Tahiri recovered inconsistent correlations betwixt U.S. wealth proviso and Bitcoin prices.

• CCN’s Bitcoin illustration hints astatine a imaginable semipermanent correction.

Morgan Stanley says it’s clip to harvest crypto gains, but caller information investigation from CCN suggests the market’s bushed whitethorn not beryllium truthful simple.

In a caller Crypto Goes Mainstream podcast, Denny Galindo, concern strategist astatine Morgan Stanley Wealth Management, said Bitcoin has entered the “fall season” of its four-year marketplace cycle.

This signifier is typically erstwhile investors currency retired earlier a imaginable crypto winter, the analysts said.

“We are successful the autumn play close now,” Galindo said.

Galindo noted that humanities patterns amusement a “three-up, one-down” bushed successful Bitcoin’s terms cycles, implying the existent rally could soon springiness mode to consolidation oregon decline.

CCN expert Valdrin Tahiri sees a much nuanced representation emerging from the data.

A illustration comparing U.S. wealth proviso with Bitcoin’s terms (in red) raises questions astir whether the crypto rhythm has genuinely been liquidity-driven.

“During the 2022–2023 carnivore market, some the Bitcoin terms and wealth proviso fell together,” Tahiri said.

In the 2018–2019 downturn, Bitcoin plunged contempt an expanding wealth supply. The 2020 bull market, however, matched perfectly with a surge successful liquidity.

More recently, the 2023 rally unfolded adjacent arsenic wealth proviso maturation hardly moved, and Bitcoin’s gait of gains slowed successful 2024 contempt a renewed pickup successful liquidity.

“There’s a correlation,” Tahiri said, “but not a accordant one.”

Tahiri’s method outlook is besides cautious.

He noted that Bitcoin’s monthly illustration flashed its archetypal large informing successful October, forming a bearish candlestick and breaking down from an ascending wedge pattern, a determination that historically signals the extremity of an uptrend.

“Bitcoin has completed a five-wave beforehand since aboriginal 2023,” Tahiri said. “That wedge was the 5th and last wave, suggesting the cycle’s upward limb is complete.”