Fundstrat’s Tom Lee believes that Bitcoin and Ethereum could be on the verge of a major surge, potentially entering a supercycle, driven by recent trends in the ISM Manufacturing Index. According to Lee, the correlation between a rising ISM index and strong growth in these cryptocurrencies has been clear in the past, and the current economic conditions could set the stage for another bullish run.
ISM Index and Economic Growth Impact on Crypto
The ISM Manufacturing Index tracks key economic factors like production, employment, and new orders. When the index surpasses the 50 mark, it signals growth in the economy. Currently, the ISM stands at 48.2, indicating that the economy is still contracting but approaching a turning point. If the index moves above 50, it could indicate a shift that would favor Bitcoin and Ethereum, Lee suggests.
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Lee highlighted that the relationship between the ISM and Bitcoin is historically strong. He noted that when adjusting for Bitcoin’s long-term trend, its price has often closely mirrored the movements of the ISM index. This suggests that the improving economic conditions could lead to a strong rally for the leading cryptocurrencies.
Disruption of Bitcoin’s Four-Year Cycle
In addition to this, Lee addressed the traditional four-year Bitcoin cycle, which many expect to repeat in 2026. However, he pointed out that the cycle may be disrupted, aligning with the view of ARK Invest’s Cathie Wood. Lee believes the typical boom-and-bust pattern could be broken, paving the way for new all-time highs as early as January. With monetary policy and the business cycle on the upswing, he forecasts significant gains for crypto investors in the near future.
Ethereum’s Market Behavior: Recent Technical Indicators
Ethereum’s current price is $3,566.1, showing a slight decline of 0.46%. The Relative Strength Index (RSI) stands at 47.06, suggesting a neutral position and potential for a breakout if it moves above 50. Ethereum is also trading near the lower Bollinger Band, indicating low volatility. The 20-day simple moving average (SMA) of $3,738 acts as resistance. These technical factors, alongside external trends, could signal upcoming price movements for Ethereum.
Lee’s analysis suggests that Ethereum, like Bitcoin, could see significant price movement if the market shifts in the way he predicts. With these technical indicators pointing toward potential volatility and bullish momentum, Ethereum could soon follow Bitcoin’s lead, entering a supercycle alongside its counterpart.