As reported by U.Today, Fundstrat CEO Tom Lee recently revealed that his Bitcoin Misery Index (BMI) reached a value of 89 for the first time since 2016. During a recent interview, the prescient Bitcoin bull weighted in on the Apr. 2 rally and explained what investors should expect now.
A real recovery
Bitcoin’s sudden surge on Apr. 2 still has crypto community scratching their heads. According to Lee, the 20 percent increase that took place in less than one hour was caused by a combination of factors. Those investors who sold their crypto riches in 2018 are finally coming home. On top of that, there is an increasing number of on-chain transactions that is coupled with growing trading volumes on cryptocurrency exchanges.
With that being said, Lee fails to explain why the BTC price rallied on that day in a one hour window, but he is still certain that it’s the start of a real recovery.
In general, Lee doesn’t pay too much attention to technical indicators. However, he claims Bitcoin’s most notable achievement on the technical side is the fact that it managed to cross its 200-day moving average (MA). This is a surefire indicator that the number one coin is recovering from a prolonging bear market. According to Fundstrat’s projections, Bitcoin was supposed to reach this point only in fall.
‘At the start of this year we thought that crossover would take place in the fall and that’s when people turn bullish, but the fact that it’s happening right now is actually, you know, is bullish, and I think it means Bitcoin’s recovery is taking place a lot of faster than we would have expected,’ said Lee.
He further added that the price recovery won’t be different from those cycles that we’ve witnessed in the past.
Bitcoin is not going to zero
Lee claims that a lot of investors were shooed away from Bitcoin after its epic crash in 2018. They thought that the O.G. cryptocurrency will eventually go to zero after a 75 percent price drop (which is common for the equity market).
However, according to Lee, BTC is still capable of reaching new highs. ’I think that the real question for those who are new crypto is: ‘Can Bitcoin retain its old highs?’. Because, obviously, if it does, it’s a 4x from here. And, I guess, we don’t think it’s going to be any problem for Bitcoin to retain its old highs,’ added Lee without specifying when exactly the king of crypto is going to get there.