Tom Lee’s Odd Few Months From Bitcoin’s Wall Street Hero to MagicPoopCannon

From Bitcoin's Wall Street Hero to MagicPoopCannon, Tom Lee's Odd Few Months

TL;DR: Bitcoin’s golden guru, its Wall Street bull hero, Fundstrat’s Tom Lee, formerly of J.P. Morgan, has had a strange few months. From his glory days of massive price calls, to a brutal 2018 and what some proclaimed was his firm’s capitulation by year’s end, to resurfacing and calling out critics, it has indeed been a trying time for Lee. He’s back, it appears, and seems leagues more sober about the ecosystem but also slightly salty, annoyed at being reminded of his past enthusiasm. 

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Bitcoin’s Wall Street Guru Tom Lee and His Strange Journey

The price run of 2017 set him apart, as Lee was among the first analysts from legacy finance to pronounce bitcoin a legitimate speculative asset. That, and as the price skyrocketed, Lee’s predictions seemed not only plausible but downright prophetic. And then they weren’t. By a lot. It was a nasty 2018 for him and his newly hung shingle, Fundstrat.

From Bitcoin's Wall Street Hero to MagicPoopCannon, Tom Lee's Odd Few Months

To be fair, market prognosticators and those in favor of what’s known as technical analysis (TA) have a daunting task. Charting is a form of divination, a belief in dancing numbers and how they’re not merely descriptive but proscriptive: the right priest can make heads of what they mean. TA’s lure increased in the last decade partly because those entering markets since their fantastic crash of 2008 have only known run-ups, bulls. For ten years straight, it has been easy to look smart and near genius. Equities simply rose, no matter what anyone said or didn’t.

The same was true, of course, during 2017 for cryptocurrencies, and probably triple-so. With little variation, cryptos jumped and spun upwards exactly correlated to bitcoin core (BTC). There was almost no sense in the speculation game of buying anything else: watch BTC, and if it’s mooning, so is everything else. Lee, and many others, rode that wave, and price predictions took on mythical proportions especially as the psychological level of $10,000 per BTC was struck and bettered. Even hats were made to celebrate.

Doubling Down, Tired

As the market cooled, Lee seemed to double-down on both short and long BTC positions. A hard fork had occurred in summer of 2017, creating bitcoin cash (BCH), and it was proving a viable alternative to BTC as a medium of exchange. Indeed, BTC developers championed bitcoin core’s high transaction fees and slow confirmation times, all of which Lee either ignored or dismissed as ultimately trivial. His 47 slide presentation early last year around this time outlined how all the demographic stars were aligning, despite BTC becoming clunky and unusable as a currency.

From Bitcoin's Wall Street Hero to MagicPoopCannon, Tom Lee's Odd Few Months

The price was tanking, for a good deal of last year, and Lee continued to be financial news networks’ favorite go-to. He made recovery predictions, and BTC’s price fell further. The coin was supposed to be five figures, around $20K by the middle of 2018, resting at something like $25,000 by year’s end. Summer 2018 left BTC at well-less than half his forecast, and by December 31st, 2018, the price couldn’t hold $4,000. Even with a charitable revision and all the escape-hatch words of “if” and phrases such “looks like,” Lee’s glow was gone. He wasn’t just wrong. He was awful. Dreadful.

By mid-December of 2018, an email to clients widely circulated quoted his firm as imploring, “We are tired of people asking us about target prices. Because of the inherent volatility in crypto, we will cease to provide any timeframes for the realization of fair value.” His once lively Twitter account reverted back to tame traditional finance, and television appearances lessened. As of this writing, Lee is reportedly not returning Bloomberg’s emails or phone calls — whereas at this time last year, he and Bloomy seemed to be on speed dial.

Fake News, MagicPoopCannon

Recently, Lee returned to crypto Twitter by batting down a story, “Fake news,” he posted. “This is not what our firm said.” And while he and Fundstrat for sure flirted with a $25,000 price call for late 2018, they, Lee maintained, made no price guess for the first quarter of 2019, which the article contradicted.

From Bitcoin's Wall Street Hero to MagicPoopCannon, Tom Lee's Odd Few Months

Not too long after, Lee tweeted again, and this time favorably, “CRYPTO: Some TA’s who were bearish in 2019 are becoming incrementally bullish on #BTC $BTC The one below refers to the 200-week mavg acting as support, something @rsluymer @fundstrat TA also noted as key support for Bitcoin.”

It’s a dramatically sober take, especially when put against 2017 and into early 2018. As with most TA, here it seems to be simply latching onto what has already happened rather than giving insight as to what might occur in the future. Lee cited a TA chart from an avatar previously known to be bearish, MagicPoopCannon. Moving averages are supposedly turning into a kind of foundation support level for BTC’s price, Lee noticed.

From Bitcoin's Wall Street Hero to MagicPoopCannon, Tom Lee's Odd Few Months
MagicPoopCannon’s chart cited by Lee

“The likelihood that the market has bottomed just increased greatly,” MagicPoopCannon posted. “We can see that Bitcoin has rallied sharply, before it even came into direct contact with the weekly 200 MA (in pink.),” which was met with, “That is very bullish , assuming that BTC can close the daily candle inside of the triangle.” Making sense of the language, which goes on in great detail, is anyone’s guess. But that’s where Lee and, frankly, the broader crypto space is now: from starry-eyed mooners to deciphering the finer points of MagicPoopCannon. What a time to be alive.

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