"Bitcoin Misery Index" Flashes 'Buy' Signal

Authored by Ana Alexandre via CoinTelegraph.com,

Wall Street strategist and co-founder of Fundstrat Global Advisors Thomas Lee has developed a ‘contrarian index’ that lets investors know how ‘miserable’ Bitcoin (BTC) holders are based on current prices, CNBC reports.

The Bitcoin Misery Index says now is the time to buy from CNBC.

The index is called the Bitcoin Misery Index (BMI) and was designed as a trading tool for investors to take advantage of volatility in BTC exchanges. BMI is calculated on a scale of zero to 100, taking into account factors such as volatility and the number of winning trades out of the total. When the indicator is low, the buying opportunity is at its best, and vice versa.

When the bitcoin misery index is at ‘misery’ (below 27), bitcoin sees the best 12-month performance. A signal is generated about every year, Lee explained to CNBC in a Friday report.

"When the BMI is at a 'misery' level, future returns are very good."

At the moment, the Bitcoin index is at 18.8, which is an absolute minimum since Sept. 6, 2011, the report said.

Lee’s comments follow a significant cryptocurrency market fall in which BTC lost almost 27 percent just after hitting a weekly high of $11,675 on Monday, March 5. A series of negative news resulted in heightened concerns about more regulations on crypto markets.

On March 7, the US Securities and Exchange Commission (SEC) issued a statement saying that all platforms trading securities are required to register with the agency as an exchange. Additionally, Japanese authorities temporarily halted the activities of two cryptocurrency exchanges and issued “punishment notices” to seven more, as reported on March 8.

Despite Bitcoin currently trading at more than 50 percent of its December 2017 high of over $20,000, Lee has not abandoned his optimistic forecast of $25,000 by the end of 2018.

Tom Lee is known for his bullish outlooks for BTC and as the “only major Wall Street strategist to issue regular reports and formal price targets on bitcoin”, according to CNBC.


J S Bach Sat, 03/10/2018 - 21:03 Permalink

BitCoin Misery Index?!

We live in a depraved world.

All old J.S. Bach recommends is... hold on to anything tangible... anything of actual physical worth... whether it be land... a home... gold, silver, hell... even milk in your refrigerator.  BitCoin is as lissome and fra-gee-lay as Ralphy's Dad's leg-lamp.  It looks good, but in reality, it is junk.

38BWD22 Coinista Sat, 03/10/2018 - 21:47 Permalink


I just bought some BTC (and my first purchase of BCH) just today.  And, yep, both are down fairly hard since.

Bearing Guy does have a track record.  Take the other side of his bet!  At least if you trade.

But, I made a lot of $ in BTC last year.  Uncle Sam will be happy with my Cap Gains Tax on that.


EDIT: bought a little Au as well

In reply to by Coinista

Code Duello 38BWD22 Sat, 03/10/2018 - 21:52 Permalink

I was there for the big advance - from below USD500 - and stated here at ZH that the time to sell was the advent of the CME, not the CBOE, futures contract.  I hate to be the bearer of bad news, DC, but the BTC Misery Index is utter bullshit.  The above study is only relevant during the BTC advance and is not applicable now since the BTC is in a major, if not terminal, downward move.

In reply to by 38BWD22

RAT005 Mustafa Kemal Sat, 03/10/2018 - 22:50 Permalink

Quite a bit of current trade action could be whales selling back and forth with each other.  No way to ever know what pricing is real.  BTC has made itself too expensive to use.  For a short time the excess price is good news to the miners but soon there won't be much demand for them due to low velocity as a result of increasing fees.  Just watch for when price and mining cost cross.  It will be more devastating than to gold and silver because there is no way for the miners to adjust to market conditions.  BTC is consuming itself.  I think less than a year to live.

In reply to by Mustafa Kemal

RAT005 Spaced Out Sun, 03/11/2018 - 12:02 Permalink

Isn't the "fee" simply some amount of bitcoin relative to the transaction?  So as the mining cost goes up, the fiat fee per BTC transaction goes up.....it costs the miners more to provide the BTC used to update/validate the blockchain.

If that explanation is too simple, please provide a better explanation.

Looking at it a different way.  If the mining cost per BTC goes up, the cost of using BTC goes up so its value goes down.  Each slow but progressive steps.  As the value of BTC goes down, the benefit of mining goes down.  Eventually they cross and BTC is finished.

The death nail for BTC is that the cost of maintaining the Blockchain is arbitrarily increasing.  This was programmed in at the beginning.  This comes from mining and blockchain support being too closely associated.  Blockchain support needs to be separate from mining so that "technology" can find cheaper ways to support the blockchain.  Gold and silver don't have this problem because there is no blockchain, because gold and silver have real value.  Hold it and you have the value.  Of course there are a lot of fraud PM certificate scams but that is the owners problem, not PM problem.

Hope I'm not too late replying to get an answer from you.  You are correct, I only own a little BTC and don't participate much because I think it's a scam.  Most of my confidence comes from my above explanation so if I learn more about that, that will be great.

In reply to by Spaced Out

Spaced Out RAT005 Sun, 03/11/2018 - 12:54 Permalink

Transaction volume is low, you are correct. However, this is not a result of high fees, because fees are at historic lows.  Rather, it is a combination of 1/ increased uptake of segwit, 2/ more exchanges batching transactions, and 3/ sellers are thinning out as the price finds new support. Expect the price to rise in the very near future as dip-buyers weigh-in and a renewed bout of FOMO takes effect.

" As the value of BTC goes down, the benefit of mining goes down.  Eventually they cross and BTC is finished. "

No, because the difficulty of mining automatically adjusts to compensate. If the difficulty decreases, it will simply allow more people to begin mining with cheaper equipment.

IMO, for this and other reasons, far from being a scam, bitcoin is unstoppable.

Incidentally, the fee is not related to the amount of bitcoin sent, it is a flat-fee, whether you send $10 or $10m. You can increase the fee if you want to ensure priority, or decrease it if it's not urgent and you're prepared to wait for a few hours.

Hope you get this.

In reply to by RAT005

0valueleft tmosley Sun, 03/11/2018 - 08:58 Permalink

But I  want a Lambo, don't you get a free Lambo when you buy BTC? It's not like I'll be a Wall Street asshole in a Lambo, I'll be a wicked smart bitcoin guy in Lambo, completely different animal. It's like comparing left Twix to right Twix.

Human beings and their greed, destroyers of everything.

In reply to by tmosley

38BWD22 dark pools of soros Sat, 03/10/2018 - 22:21 Permalink


Athena's BTC ATMs now offer BCH for CA$H.  Athena's rate went down as well (now at 10% vs. 14% not too long ago).

Also had some old BTC sitting around in hardware wallets that got a free "airdrop" of BCH several weeks ago from the July 2017 fork.

*   *   *

You might be right about BTC miners getting taxed.  They will head elsewhere.  I read an interesting article (later posted here at ZH IIRC) about Washington State getting lots of miners because of low electricity costs.

But, miners will just take their rigs elsewhere if taxed too highly here.

In reply to by dark pools of soros

ProstoDoZiemi Coinista Sat, 03/10/2018 - 22:09 Permalink

The idea is great, but it's hard when you're betting against someone that has deep pockets.

I've trimmed exposure in the past couple of weeks, I believe that it's at a pivotal point now, if it tests and fails 8200 in the next day or so, 6000 here we go.

No one ever gone broke reducing exposure taking profit, it's ok to sit on the sidelines till the dust clears.

In reply to by Coinista

lookslikecraptome lester1 Sun, 03/11/2018 - 01:11 Permalink

The people here flip out, the crypto evangelists, when u say the word ponzi, Lester.  Perhaps u can help them see the light if u use the term AMWAY LIKE where the top folks get rich while the rest of the folks own soap for the rest of their lives. You night also see if u can slip in the word multi level marketing. I have some coin Lester and I take no offense at ur utilation of the word ponzi as a descriptor of BTC. I do think Amway Like is a more apt descriptor. I do see that some of the coiners have accused the major stock market and indexes of being a ponzi scheme. I am perplexed as to how they say this about the stock market and not c that about the coin market. So I think u might be hitting a nerve. However Lester, I do believe their cognitive dissonance might be better reduces if u utilized a word other than ponzi. 

You know Lester, I could not buy a set of tires two weeks ago with BTC, and I looked through three counties. 

I think u irritate people that lost 10000 per coin over the last several months. There were early adopters and good for them. Kudos in fact. But Lester, you must be kind. They did not know how to manage their trades/investments and now they are having to deal with a 10 grand loss per coin, maybe more to come, and they are too scared to pull the trigger. So they are praying, hoping, they will get some of that ten grand per coin back. The people that got burned at the top are gone and will never come back. 

Maybe this system will help them. 

You know Lester, it takes a special kind of person to let a 19500 coin go to 9000 and not do anything about it

In reply to by lester1

lookslikecraptome IH8OBAMA Sun, 03/11/2018 - 00:45 Permalink

I wonder if I can buy this "trading system" from this dream merchant lee for 50,000. I might even go as high as 100000. I am guessing it has been thoroughly back tested across years of data and number crunched to be statistically significant by the best minds at MIT. The disclaimer probably reads. be prepared sucker, u r gonna die financially eating one of Stormy Daniels pasties. 

I might actually commit murder to get this system. 

In reply to by IH8OBAMA