Tom Lee of Fundstrat States that the number one cryptocurrency can finish the year explosive growth. The main reason for this is the correlation between the price of bitcoin and Emerging Markets.
This statement was made in an interview during the show CNBC “Trading Nation”.
Tom Lee continues to believe that the price of bitcoin could increase to $ 25,000 this year. Lee bases this assumption on the ratio of the prices of BTC and exchange-traded Fund iShares MSCI Emerging Markets from BlackRock (ETF) that tracks large-and medium-sized companies in emerging markets.
“Important correlation”, according to Lee, is that both markets are developing parallel to each other and they are both “peaked” at the beginning of 2018, and also “both are in a downward trend” since that time.
According to Lee, recent trading activity shows that hedge funds have ceased to invest in assets tied to emerging markets due to market risks, which in turn leads to lower investment in bitcoin.
How does the change in the trend in emerging economies will signal about a similar change in the trend of bitcoin:
While emerging markets will not begin the turn, I think, in a sense, this correlation will continue and it says that there are certain risks that discourage investment in bitcoin.
In an interview, Lee noted that “the trend is changing” how for bitcoin and emerging markets, especially if the Federal reserve slows the growth of interest rates (which is happening now).
In early July, Li said that the price of bitcoin could reach 22-25 thousand dollars by the end of 2018.
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