According to the Bitcoin Misery Index, right now represents a great time to buy Bitcoin.
In fact, right now is the lowest (best) reading on the BMI since September of 2011.
Which means, this is possibly one of the better times to buy bitcoin, based on this index, in the last 7 years.
That all sounds well and good, but what the heck is the Bitcoin Misery Index?
I'm glad you asked!
The BMI is an index based on a research report put out earlier today by Fundstrat Global Advisors.
In summation, Tom Lee (co-founder of Fundstrat) sums it up as this:
"When the bitcoin misery index is at 'misery' (below 27), bitcoin sees the best 12-month performance. A signal is generated about every year."
Basically, what he is saying is that when things are the most miserable, the returns over the next 12 months have been the greatest.
What does it take into account?
It isn't entirely clear what all the inputs are, but Fundstrat did leave a couple comments on what comprises the index.
According to Fundstrat, the BMI takes into account factors such as the number of winning trades out of the total and also volatility.
Here is a visual:
As you can see, if you had bought bitcoin each time the BMI crossed 27 to the downside, you would have made a minimum of 20% and a maximum of 3600% over the next 12 months.
Currently it sits at 18, the lowest it has been in almost 7 years.
Not sure about you, but given this data, bring on the Misery!
Tom Lee seems to agree:
"The BMI is telling us to keep the negative headlines in perspective. When the BMI is at a 'misery' level, future returns are very good."
Oh, and Mr. Lee also reaffirmed his price target for bitcoin of $20k by July of 2018 and $25k by the end of this year.
Stay informed my friends.
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