Tom Lee reiterates his 2018 Bitcoin price outlook, stating that the leading cryptocurrency’s price action is very much dependent on the developments in emerging markets.
27 August, AtoZ Markets – One of the famous figures in the crypto world, Fundstrat’s Bitcoin analyst Tom Lee has shared his outlook regarding the current condition of the cryptocurrency market and hos forecast for Bitcoin price.
Tom Lee Reiterates His $25K 2018 Bitcoin Price Outlook
He has stated that Bitcoin “could end the year explosively higher,” referring to a correlation between the leading cryptocurrency and emerging markets. Mr. Lee has presented his new Bitcoin price forecast earlier last week.
Tom Lee has noted that the “important correlation” emerges from the fact that both markets are developing somewhat parallel to each other. In addition, both of them have “really essentially peaked” in early 2018, as well as “both [having been] in a downward trend” from then on.
The Head of Research at Fundstrat Global Advisors has added that he “still think[s] it’s possible” that the price of Bitcoin could hit as high as $25,000 this year. He noted that he based his forecast on the relationship between the price of Bitcoin and BlackRock’s iShares MSCO Emerging Markets exchange-traded fund (ETF). The latter tracks large and mid-sized companies in emerging markets.
Emerging Markets Trend
According to Mr. Lee, recent trading activity indicated that hedge funds have stopped buying into funds that are connected to emerging markets. This is happening due to marker sell-off risks. These risks, in turn, lead to limited purchases of Bitcoin.
He further explains that he believes that a turn in direction in emerging markets would ultimately signal a similar change in Bitcoin’s price trend:
“Until emerging markets begin to turn, I think in some ways that correlation is going to hold and tell us that sort of the risk on mentality is those buyers aren’t buying Bitcoin.”
During his public appearance, Mr. Lee has highlighted that the “tide is changing” for both Bitcoin and emerging markets. He noted this is especially is the case if the US Federal Reserve will slow down its interest rate hike speed.
Tom Lee’s 2020 Bitcoin Price Forecast
Earlier this July, Mr. Lee has stated that his Bitcoin price outlook for the end of 2018 stands between $22,000 to $25,000. Mr. Lee’s Bitcoin price forecast comes in line with his previous remarks he made in the very beginning of the year when he stated that Bitcoin can “easily double” this year. In his statement, Mr. Lee has also mentioned the phenomenon of conventional companies creating their own internal cryptocurrencies. He has stated:
“Already three major companies have announced efforts within cryptocurrencies, which demonstrate that corporations may be moving towards cryptocurrencies before Wall Street has embraced them.”
In March 2018, Tom Lee has also stated that Bitcoin can reach $91,000 by March 2020. He has based his Bitcoin outlook on a chart that indicates Bitcoin’s performance following the past market dips.
Mr. Lee and Fundstrat have used an average of the percentage gained at price after each dip to come up with the 2020 Bitcoin price figure.
Think we missed something? Let us know in the comments section below.