Tom Lee Trims This Year’s Price Bet Following a Crash
The latest price crash puts bulls on the back foot: Tom Lee, the co-founder of Fundstrat Global Advisors and one of the prominent Bitcoin lovers, had reduced his price prediction for this year after a significant selloff in the crypto market last week.
Cryptocurrency markets have lost more than $30 billion last week; the selloff was initially backed by traders’ concerns over the Bitcoin Cash hard fork event. Bitcoin’s price plunged below the psychological $6,000 level last week. BTC is currently trading around $5,500, the lowest level in the last 12 months.
Bitcoin Cash was among the biggest losers among the top 10 coins. BCH’s price dropped from $630 at the beginning of the last week to $380 at present, representing the loss of close to 40% in the last seven days alone.
Tom Lee Declines his Bitcoin Price Prediction for this year
The unexpected selloff in the Bitcoin price has compelled Tom Lee to drop his fiscal 2018 BTC price prediction from $25,000 to $15,000. Though the analyst has trimmed the BTC price prediction, he is still optimistic that BTC is still in sound fundamental position.
He said, “While Bitcoin broke below that psychologically important $6,000, this has lead to a renewed wave of pessimism, but we believe the negative swing in sentiment is much worse than the fundamental implications.”
He claims the selloff in crypto markets was supported by specific event instead of fundamentals factors that could have a long-term impact on the market.
Lee is actually basing his price prediction on the mining cost and the breakeven level. He says, “Bitcoin has historically traded 2.5 times its mining cost, so it’s not out of the question that it could be around $15000 by the end of the year.”
According to Tom Lee’s data science team, BTC’s mining break-even point is around $7,000 and he believes the largest coin has the potential to trade 2.5 times higher than its break-even level.
Is it Possible for BTC to Create a Substantial Bull-Run?
BTC has the history of making significant price swings in both directions due to some specific event or market speculations. This is why it’s quite difficult to predict where BTC would stand in the long and short term. However, it’s true that the latest sell-off is triggered by a specific event while the market fundamentals remain strong, thanks to the entrance Goldman Sachs and other institutions.
What’s your opinion of Tom Lee’s new price prediction? Let us know about your thoughts in the comment section below.