In an interview on CNBC, market guru Tom Lee of Fundstrat Global Advisors pointed out a little-talked-about correlation between emerging markets and bitcoin, the leading coin in the digital currency space. According to Mr Lee, “Both really essentially peaked early this year, and they both have been in a downward trend.” (he made this comments on CNBC Trading Nation). He went on to point out that until emerging markets begin to turn, this correlation will hold. Bitcoin is down 65 percent from its highs of just under $20,000 in December. Recently, it has trade in a $5,900 to $6,500 range.
Mr Lee points out that hedge funds are not buying EM or emerging markets, nor are they buying Bitcoin. Mr Lee suggests that the tide could turn on Wall Street and if the Federal Reserve slows its interest rate hike policy, and the US dollar weakens, money on the sidelines could start to move into Bitcoin and of course, to emerging markets.
“I still think it`s possible,” said Mr Lee, “Bitcoin could end the year explosively higher.” He feels that factors could help bitcoin surge to $25,000 by the end of 2018.