News & Analyses

Bitcoin makes run for previous cycle highs as Morgan Stanley pushes BTC ETF exposure

  • Morgan Stanley has filed prospectus to add BTC exposure in two of their funds.
  • Kraken CEO Dave Ripley said the market is a bit ahead of schedule after $73,777 ATH pre-halving.
  • On the one-minute time frame, $66,500 and $66,754 are crucial buyer and seller congestion levels, respectively, on volume profile metrics.

Bitcoin (BTC) price strength continues to grow, three days after the fourth halving. Optimism continues to abound in the market as Bitcoiners envision a reclamation of previous cycle highs.

Also Read: Bitcoin price rises past $66K as markets record falling BTC transaction fees

Daily digest market movers: Morgan Stanley pushes for more Bitcoin ETF exposure

American multinational investment bank Morgan Stanley filed a prospectus to add BTC exposure in two of their funds, the Discovery and Growth Portfolios. It comes after the financial services company filed for Bitcoin exchange-traded funds (ETF) exposure in twelve other funds earlier in the month.

As part of the commitment to driving more exposure, the bank, boasting up to $1.5 trillion in assets under management (AUM), had sent compliance and education materials out to all advisors three weeks ago. This was in readiness for the anticipated approval of Bitcoin ETFs for its network of advisors to sell to clients.

Morgan Stanley prospectus excerpt

It is likely that other asset managers will follow Morgan Stanley’s lead and look to add Bitcoin exposure to their funds. This could start slowly then intensify as happened in the case for ETFs. Citing Brian Kelly on CNBC:

You have a lot of pent-up demand with Morgan Stanley and UBS yet to come online with a supply that’s been cut – that’s the bullish case for Bitcoin.

Kelly’s remarks came as he discussed the effect of the halving in conjunction with the ETFs.

Elsewhere, Kraken CEO Dave Ripley says the market is a bit ahead of schedule after Bitcoin price recorded a new all-time high of $73,777 ATH before the halving. In his words, “This is the first time we’ve actually seen an all-time high before the halving… we’re a little bit ahead of schedule.”

Technical analysis: Bitcoin price shows strength as bulls defend $66,500

Based on the one-minute time frame for the BTC/USDT trading pair, the volume profile indicator shows that many bulls are defending the $66,500 level, marked by large yellow volume spikes to show where the buyers find congestion. The bears on the other hand are heavily positioned around $66,754, marked by the grey volume spikes in the chart.

Should Bitcoin price pull back, the buyer congestion level around $66,500 would counter the selling pressure. If bullish momentum overpowers selling pressure from the bears, Bitcoin price could shatter the resistance at $66,754.

A candlestick close above this level on the one-minute time frame would confirm the continuation of the uptrend. This could see Bitcoin price reclaim the $73,777 peak before recording a new ATH.

BTC/USDT 1-min chart

If the bears have their way, however, Bitcoin price could slip below $66,500, with a break and close below $66,400 opening the drains for further downside to $60,000.

On the daily time frame, there is an overall higher high on the Relative Strength Index (RSI), which is still bullish as it remains well above the 50 mean level. The 21, 50, and 200-day Smooth Moving Averages (SMMA) indicators are also in an overall uptrend, showing this is the overall trend direction. Key levels to watch in this directional bias are $70,000 and $73,777, beyond which markets would see a new ATH.

BTC/USDT 1-week chart

A weekly candlestick close below $60,000 would produce a lower low, invalidating the bullish thesis.

Bitcoin, altcoins, stablecoins FAQs

Bitcoin is the largest cryptocurrency by market capitalization, a virtual currency designed to serve as money. This form of payment cannot be controlled by any one person, group, or entity, which eliminates the need for third-party participation during financial transactions.

Altcoins are any cryptocurrency apart from Bitcoin, but some also regard Ethereum as a non-altcoin because it is from these two cryptocurrencies that forking happens. If this is true, then Litecoin is the first altcoin, forked from the Bitcoin protocol and, therefore, an “improved” version of it.

Stablecoins are cryptocurrencies designed to have a stable price, with their value backed by a reserve of the asset it represents. To achieve this, the value of any one stablecoin is pegged to a commodity or financial instrument, such as the US Dollar (USD), with its supply regulated by an algorithm or demand. The main goal of stablecoins is to provide an on/off-ramp for investors willing to trade and invest in cryptocurrencies. Stablecoins also allow investors to store value since cryptocurrencies, in general, are subject to volatility.

Bitcoin dominance is the ratio of Bitcoin’s market capitalization to the total market capitalization of all cryptocurrencies combined. It provides a clear picture of Bitcoin’s interest among investors. A high BTC dominance typically happens before and during a bull run, in which investors resort to investing in relatively stable and high market capitalization cryptocurrency like Bitcoin. A drop in BTC dominance usually means that investors are moving their capital and/or profits to altcoins in a quest for higher returns, which usually triggers an explosion of altcoin rallies.

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