In a new market outlook, Morgan Stanley strategists have warned that Bitcoin (BTC) has officially entered the “fall phase” of its four-year cycle — a period often marked by profit-taking, fading momentum, and potential consolidation following massive rallies.
According to the U.S. banking giant, this stage could set the tone for Bitcoin’s market direction through early 2026, as investors reassess risk amid cooling sentiment and declining liquidity flows.
🍂 Bitcoin’s “Fall Season” Explained: The Harvest Phase After the Boom
Morgan Stanley’s investment strategist Denny Galindo compared Bitcoin’s market rhythm to the four seasons — with spring representing accumulation, summer the explosive bull run, fall the profit-taking phase, and winter the bear market.
“Bitcoin appears to have entered the fall season — a time when investors traditionally harvest profits and prepare for the next cycle,” said Galindo in Morgan Stanley’s November 2025 market note.
After Bitcoin’s remarkable surge past $120,000 in mid-2025, prices have since cooled to around $103,000, slipping below the 365-day moving average — a technical threshold often signaling a shift from bullish momentum to neutral or corrective territory.
📉 Key Insights from Morgan Stanley’s Report
- BTC Price Momentum Weakening: The fall below the 365-day average is viewed as a key inflection point, suggesting slower upside potential in the coming months.
- Cycle Pattern Holds: Historically, Bitcoin follows a three-year uptrend after each halving, followed by one year of decline or stagnation.
- Profit-Taking Rising: On-chain data shows increasing outflows from long-term wallets to exchanges — a classic indicator of profit booking.
- Liquidity Drivers Plateauing: Growth in stablecoin supply, ETF inflows, and institutional treasuries has stagnated since October, hinting at a cooling demand phase.
💼 Institutional Sentiment: Cooling Momentum but Growing Adoption
While Morgan Stanley warns of near-term caution, it also highlights long-term institutional confidence in Bitcoin’s future.
- U.S. spot Bitcoin ETFs now collectively hold over $137 billion in assets, showing that Wall Street’s involvement in crypto remains strong despite short-term pullbacks.[1][5]
- Bitcoin continues to gain recognition as a digital inflation hedge and portfolio diversifier, comparable to gold in function but with superior liquidity and portability.
However, strategists caution that as ETF-driven demand stabilizes, market liquidity may tighten, amplifying short-term volatility during the fall phase.
⚠️ Why the “Fall Phase” Matters for Bitcoin Investors
Morgan Stanley’s seasonal model suggests that this phase is not a crash, but a transition. The “fall” period typically lasts several months before leading into a deeper “winter” correction or long consolidation.
In past cycles, similar patterns were observed:
- 2017–2018: Bitcoin peaked near $20,000, then corrected by over 80%.
- 2021–2022: BTC hit $69,000, followed by a prolonged bear market to $16,000.
With the current halving cycle beginning in April 2024, the fall season of 2025 fits neatly into this historical rhythm.
💰 Morgan Stanley’s Advice to Crypto Investors
The bank recommends that investors:
- Secure Profits: Lock in partial gains from the rally and rebalance portfolios.
- Maintain Liquidity: Keep cash reserves ready to buy dips or manage volatility.
- Diversify Exposure: Balance crypto holdings with traditional assets or stablecoins.
- Stay Informed: Track on-chain metrics, ETF flows, and macroeconomic conditions like inflation and interest rates.
- “This is not a bearish call, but a reality check,” the report notes. “Investors should prepare for a cooling phase after one of Bitcoin’s strongest runs since 2020.”
🧭 The Broader Picture: Bitcoin’s Maturing Market Cycle
Morgan Stanley’s analysis reflects a broader trend — Wall Street’s evolving approach to crypto.
Bitcoin is no longer seen as a speculative anomaly but as an emerging macro asset, integrated into global portfolio strategies.
This “seasonal framework” is now being used by major funds and banks to time crypto investments more strategically, similar to commodities or equity cycles.
As Denny Galindo summarized, “Each Bitcoin season offers opportunities — but those who recognize the transitions early often gain the most.”
🔮 What’s Next: Is a Crypto Winter Coming?
While analysts stop short of predicting a crash, they note that momentum loss, reduced ETF inflows, and macro headwinds (like potential U.S. rate hikes) could trigger a sideways or downward phase lasting through early 2026.
Still, long-term fundamentals — limited supply, institutional adoption, and regulatory clarity — remain intact. The “fall” phase, they argue, is less about fear and more about maturity and rotation in the crypto market.
🧠 Final Take: A Time to Reflect, Not Panic
Morgan Stanley’s warning serves as a reminder that Bitcoin’s journey isn’t linear. Each cycle carries its seasons — and recognizing them early can separate wise investors from emotional traders.
As the report concludes:
“It’s harvest time for Bitcoin investors — a moment to reflect, rebalance, and prepare for the next spring.”