https://ift.tt/mWnqeAjbx Stanley: Bitcoin’s drop is a correction

According to a report by the American investment bank Morgan Stanley, the 50% drop in Bitcoin and most cryptocurrencies from November’s record high to date is not at all worrying: it would only be a correction. 

Morgan Stanley’s analysis on Bitcoin

According to Morgan Stanley analysts in their report titled “State of the Bearish Market,” the descent of Bitcoin and the cryptocurrency market is within the historical data of the digital currency, and should not cause undue concern to investors.

The report states that Bitcoin is, at this time, at an interlocutory price level, but that it should not be of concern. According to Morgan Stanley analysts, the current level around $36/37,000 is quite far from what is considered as an important support at $28,000. The breaking of this price level, in fact, could lead to heavy bearish pressure on Bitcoin prices. Vice versa in case of an upward breach of the 45,000 dollar level, it would probably lead to a mass return of purchases.

Analysts at the American bank point out that since its birth in 2009, Bitcoin has gone through as many as 15 periods of strong declines in its prices, and right now we would be witnessing precisely one of these bearish moments.

“Until bitcoin is commonly used as a currency for goods and services transactions (in the crypto or non-crypto world), it is hard to value bitcoin on fundamental demand beyond the asset speculation”,

Morgan Stanley stated.

According to the report, the popularity of DeFi and the NFT market are sure to be important drivers of rising cryptocurrency market prices in the near future.

Goldman Sachs: Bitcoin at $100,000

But it is not only Morgan Stanley that has a positive view on the future of cryptocurrencies. Even Goldman Sachs recently went so far as to make very optimistic predictions about the future price of Bitcoin, despite the big declines in the last couple of months.

On 6 January in a detailed report on financial markets, the major star-studded investment bank predicted Bitcoin to exceed $100,000 within the next five years.

“We think that bitcoin’s market share will most likely rise over time as a byproduct of broader adoption of digital assets”.

That’s what Zach Pandl, co-head of the bank’s global foreign exchange, rates and emerging markets strategy, wrote in the report.

According to the Goldman Sachs strategist, Bitcoin is expected to increasingly gain ground against gold, whose prices appear to have found strong resistance at the $1,800-an-ounce price point as a store of value.

JP Morgan bullish on Bitcoin

Finally, JP Morgan, the third-largest US investment bank, predicted strong growth in the NFT and blockchain market and maintained its forecast of Bitcoin reaching $146,000 by the end of the year or by early 2023 at the latest.