Fundtrat’s Tome Lee has brought some optimism to bitcoin owners feeling deflated by the tumble in value this week. This week he told CNBC’s “Fast Money” that bitcoin “isn’t broken.”
Her referred viewers to Fundstrat’s Bitcoin Misery Index, which aims to inform investors of how “miserable” holders of the currency are, based on its price and volatility.
Lee explained that when the Index falls below 27, that is a time to buy for good future returns and added that when it reaches 68, “it’s time to sell bitcoin.” This week the index hovers around 39, which Lee explains as meaning, “Bitcoin isn’t broken if it’s holding at these levels. I think people are afraid it is going to go back down to $6,000 and never come back from those bear markets.”
He also pointed out that bitcoin’s market level had briefly surged to around 48 in the last few weeks after dropping to 37 in July. Lee believes that this indicates the bitcoin keeps gaining momentum in terms of market share and that this is “actually showing the market is reacting to what’s been taking place.”
Other news that has positively affected bitcoin is the SEC’s announcement that bitcoin is not a security and the Intercontinental Exchange’s (ICE) statement that it is developing a new global digital assets platform.
ICE, which is the operator of 23 leading global exchanges including the New York Stock Exchange, said it plans to “build an integrated digital assets platform to enable customers, merchants, and institutional clients to buy, sell, store, and spend digital assets on a ‘seamless global network’,” according to Cointelegraph.
Lee is undoubtedly a bitcoin bull and this fact should be kept in mind. In July he predicted that bitcoin could possibly reach somewhere between $22,000 and $25,000 by the end of 2018 and that the June downtrend “would be reversed if Bitcoin could push through a resistance point of $6,300 to $6,400.” Well, it did do that, but today it looks like we’re almost back at that $6,400 point, so another pushback is needed to see the price go up again. Although, if Lee’s Misery Index is the one to follow, new buyers will be hoping it slides a it further so they can get into the game.