- Strong global risk rally good for Bitcoin ATH
- The trendless global market is not good for bitcoin
- Could this cycle of new highs trigger the prices of altcoins as well?
Bitcoin bull and Fundstrat’s Tom Lee believes S&P 500 will be the catalyst for Bitcoin’s new all-time high (ATH).
In an interview with Melissa Lee of CNBC’s Fast Money on Sept. 13, Lee said it won’t be investors that buy into Bitcoin to hedge micro risks that will take it to new highs rather when they feel optimistic about the wider geopolitics and economy and traditional markets, Bitcoin will rise.
“Bitcoin has stalled recently because the macro outlook has stalled. In a world without trend, Bitcoin doesn’t go up. So I think the next big catalyst is a decisive breakout in the equity markets because once equities reach an all-time high, Bitcoin becomes a risk-on asset.”
However, he doesn’t discount the possibility that it could both be a risk-on and risk-off asset,
“Bitcoin may be ambidextrous: it works well in a risk-on world, but when you start to get nervous, then you treat it like digital gold.”
Strong global risk rally Good for Bitcoin ATH
He also took to Twitter to talk about this narrative as he said “financial calamity” might not be good for the Bitcoin price in the near term.
A “strong global risk rally” that is S&P 500 surging, on the other would be
“better environment for Bitcoin’s ATH.”
Lee further talked about an analysis that Fundstrat shared with its clients that indicates over the past ten years, about three or four best performing years of the S&P 500 index coincided with the best years of Bitcoin.
It could be said as stocks benefit from easy fiat money, with central banks around the world cutting down interest rates and printing money like crazy, alternative options like gold and Bitcoin would benefit from governments’ monetary easing.
Unpopular opinion, Bitcoin won’t make a new high until S&P 500 makes a new high.
– $BTC has been rangebound because macro trendless. Confirmed by our Bitcoin Misery Index falling from 66 (50 now)
— Thomas Lee (@fundstrat) September 12, 2019
The Bitcoin Misery Index, BMI, he said is conforming the trendless nature of the flagship cryptocurrency. Currently, the BMI is at 66 but needs to drop around 50 to start the bull run yet again.
As such, the cryptocurrency might not be correlated with the S&P 500 in the long term but
“trendless global market is not good for bitcoin.”
What about Altcoins?
Could this cycle of new highs in Bitcoin and S&P trigger the prices of altcoins as well?
BKCM CEO Brian Kelly joined the conversation asking Lee the very same thing.
Altcoins Lee said are useful but there is no “one fits all” approach with them.
“So, I think that may end playing out is S&P hits an ATH, Bitcoin reaches an ATH, which is not too far away for Bitcoin. Then, I think it will likely lead to the start of an alt season,”