Staunch Bitcoin bull Tom Lee from Fundstrat is back to predicting a good time for cryptocurrencies. He says that the crypto winter is over.
Bitcoin Makes a Comeback
Bitcoin moved steadily upwards in April, moving away from the bearish pressures it felt throughout 2018 and the first quarter of 2019. Though the markets dropped slightly on Friday, following severe allegations on Tether and Bitfinex, Tom Lee believes that the bull markets may already have been here.
Talking to CNBC on Futures Now, he said:
“Last year was a terrible year for crypto, a massive bear market, and we published a piece this week just highlighting … 11 signs that historically only take place in a bull market. So, I think the evidence is mounting that there’s a bull market.”
Of the 11 signs, Lee believes that Bitcoin’s top contributors will be trading volumes, technical indicators, and blockchain. The first sign arrived in January when trading volumes on blockchain became positive year on year. Political and financial turmoil in Turkey and Venezuela helped the currency too, as people started looking for alternatives in the form of Bitcoin. The two countries accounted for about 30% increase in on-chain activity. Lee mentioned that the improvement is meaningful as people have started trusting Bitcoin more than their banks and local currencies.
The Signs Keep on Coming
The second sign of bullish reversal came in April this year. BTC closed above its 200-day moving average this momentum, showing that the technical indicators are in favor of the currency’s upward movement. Fundstrat’s survey of OTC brokers gave the third signs, suggesting that trading per client surged and activity levels increased by 60% to 70%.
Lee suggests that both technical and fundamental indicators are improving and the activity in the crypto market is resuming, mostly attributed to crypto hodlers. Fundstrat has a Bitcoin Misery Index, a consensus among the original Bitcoin bulls about the state of the market. The index shows that the currency has bottomed out. Bitcoin charts also saw a golden cross, as the 50-day moving average took over the 200-day moving average.
It suggests that Bitcoin hasn’t stopped moving and there could be a lot of steam left in the currency.