Fundstrat founder Tom Lee is once again about cryptocurrency prospects, predicting that prices will reach all-time new highs by 2020.
Lee, one of the most prominent bitcoin bulls, gave his positive outlook for the crypto industry during an interview with U.S. pay TV channel CNBC.
According to Lee, Bitcoin (BTC) is yet to hit its ceiling and potential for further upward movement remains. He predicted that the top cryptocurrency by market cap is likely going to hit a new all-time high price somewhere around 2020.
The forecast, he said, is premised on the presence of “11 signs” which have historically been witnessed only during a bull market. With this sentiment, Lee appears to be reiterating his earlier prognosis about bitcoin likely entering a bullish trend.
The Fundstrat chief added that of the 11 signs present for a bull market, three indicated that the market downturn had ended. The three signs include great strides in blockchain transactions, bitcoin technical indicators as well as its trading volumes.
The team at Fundstrat Global Advisors had in January noted that the first of the three signs were shown by the positive turn in annual blockchain transactions rates. For the second, the team pointed to BTC’s April indicators when it crossed the 200-day moving average.
In terms of trading volumes, Lee’s forecast relies on figures related to over-the-counter transactions and from brokers. The latter has apparently a key component in assessing the trading patterns of institutional investors.
On this basis, Lee noted that activity levels comparative to customer numbers had shot up by about 60 percent to 70 percent.
Lee added that the crypto market had witnessed an improvement in all these areas- fundamentals, technicals, and more importantly, the activity levels displayed by crypto hodlers.
With these key improvements, it is possible to fathom “a 2.5 standard deviation move for bitcoin,” that would see it hit $14,000.
He however added:
“I’m not saying that’s where it’s going to go, but that’s the magnitude of move that would be a catch-up.”
Lee notably released figures from his “Bitcoin Misery Index” (BMI) earlier this April and gauged that it was at its highest since June 2016. The BMI measures sentiment in terms of how price and volatility affect BTC holders’ “miserable” levels.
Although he pointed out that the BMI portended mixed signals, the fact that it surpassed the 67 levels was evidence that the bitcoin bear market had ended when BTC hit a low of $3000.
Fundstrat’s report in February predicted a positive outlook for the 2019 crypto market, advising that incremental improvements would see prices hit higher highs.
Among these improvements is the probable impact of Binance’s launch of a service allowing for credit card-supported crypto purchases. Rumors that leading bitcoin mining hardware Bitfury and Bitmain were considering initial public offerings (IPOs) could also aid in price gains.
Bitcoin currently trades at slightly over $5200, having traded at prices below $3500 at the beginning of February.
Disclaimer: This is not investment advice. Cryptocurrencies are highly volatile assets and are very risky investments. Do your research and consult an investment professional before investing. Never invest more than you can afford to lose. Never borrow money to invest in cryptocurrencies.