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Tom Lee of Fundstrat Global Advisors on Bitcoin

Tom Lee of Fundstrat Global Advisors on Bitcoin
  • BITCOIN NEEDS A CLEAR MACRO TREND (Slide 3). A comparison of Bitcoin’s and S&P 500 performance bears this out.  In years where S&P 500 has seen gains >15%, Bitcoin averages 1,800% annual gains.  When S&P 500 flattish/up <15%, BTC ~300% and when S&P 500 is down, BTC averages declines of 9%.   NOTICE A PATTERN?  When there is a clear trend in risky markets, Bitcoin shines.  Granted, this is only 10 years of price history.  But as the chart on Slide 4 shows, it is a striking relationship.

 

  • BITCOIN WAITING FOR S&P 500 TO MAKE A NEW HIGH. The implication, in our view, is the S&P 500 needs to break to an all-time high, to reawaken Bitcoin.  The all-time high is 3,025 or so.  And thus, the S&P 500 is 1% away from achieving this. We expect a 2H19 S&P 500 rally, pushing the index to >3,125

 

  • BITCOIN MISERY INDEX CONFIRMING THIS, AS IT BROKE DOWN IN MID-JULY.  On July 30th, we advised our clients “Bitcoin Misery Index (BMI) below 66…take the rest of summer off” (see Crypto Strategy reported dated 7/30/19) as a confirmed decline in BMI has been associated with weak forward returns—previous to 2019, the BMI saw same dynamic in July 7, 2016 and entered a period of consolidation for 6-8 weeks.

 

This is a sample of the research that Tom Lee and the Fundstrat Team produces. Have a look at Tom on Youtube/CNBC and their offering across equity and crypto products. 

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