2018-8-28 16:19 |
Fundstrat’s Thomas Lee has had his eye on the Bitcoin markets, and he is predicting that Bitcoin’s bullish phase could be back by the end of the year. Calling it a critical correlation, Lee said that emerging markets and Bitcoin markets are intimately connected. If the correlation he has spotted continues, we could see a breakthrough in Bitcoin prices.
What Connects BTC and Emerging Markets?Commenting on the connection between Bitcoin and emerging markets, Thomas Lee said on the CNBC show “Trading Nation”:
“Both really essentially peaked early this year, and they both have been in a downward trend.”
He added:
“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.”
Does this mean that emerging markets hold the key to Bitcoin bullish reversal and not the impending regulatory doom that some US companies are facing? It is possible that Bitcoin would become a champion of currency in certain African countries, where the lack of financial infrastructure creates a compelling use case.
Emerging Markets Remain in PainThe iShares MSCI Emerging Markets Index ETF has slumped by 8 percent year-to-date. Though it is nothing compared to the Bitcoin sell-off, which has shaved off about two-thirds of the coin’s all-time highs, the impact could be widely felt. Since reaching $20,000 in December 2017, Bitcoin’s value has been on a downtrend, trading at just under $6,750 at press time.
Thomas Lee believes that hedge funds are not buying either Bitcoin or emerging markets as they do not wish to carry more risk presently. However, this trend could come to a halt. Lee suggests that hedge funds could now be opening up to both emerging markets and cryptocurrencies. If the Federal Reserve slows its interest rate hike policy and the dollar weakens, then there is a chance that hedge funds will jump to acquire both markets.
The Fundstrat co-founder suggests that Bitcoin could surge all the way up to $25,000 by the end of 2018. He noted:
“I still think it’s possible. Bitcoin could end the year explosively higher.”
This Expert Thinks Bitcoin Could Explode by Year-End was originally found on [blokt] - Blockchain, Bitcoin & Cryptocurrency News.
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