Ethereum (ETH) Due for Big Comeback: Fundstrat’s Tom Lee

Ethereum, currently suffering from a large-scale sell-off after the cryptocurrency market tanked this year, is poised to bounce back in a big way, according to Tom Lee of Fundstrat Global Advisors.

As per a report by Bloomberg, Lee – managing partner and head of research at Fundstrat – wrote the following in a note to clients:

“Ethereum is about to stage a trend reversal and rally strongly. Sentiment is currently overly negative.”

The beleaguered digital coin is currently the second largest cryptocurrency by market cap (although this spot has recently been challenged twice by Ripple’s XRP), but its latest price tag of around $225 (at press time) is a far cry from its stellar performance last year and its January 2018 all-time high of above $1,400.

ETH started this month at around $300, but fell below the $200 mark on September 9, reaching a low of around $170 on September 12. This drastic dip in price may be attributed to growing negative sentiment surrounding the lack of direction and clarity in the project’s technology roadmap, governance issues, network flaws, increased competition from other platforms, but more importantly, to a severe sell-off as ICOs such as EOS scrambled to salvage their funds in the bear market, leading to further panic selling. Overall, ETH has lost more than 70% of its value this year.

However, Lee is convinced it isn’t too late for a comeback. According to the crypto permabull, ETH’s past performance is telling – previously, all four times Ether underperformed its peers by two standard deviations, it saw “a major trend reversal”. The former J.P. Morgan Chief Equity Strategist also noted that while ETH has lagged behind other cryptocurrencies by two standard deviations, that is “a sign of capitulation”.

While Ether currently appears to be on a slow track of recovery, Lee admits that it is faced with a “challenging technical picture”, along with being “dogged” by heavy “panic selling” by EOS and other ICO teams. However, he still expects the token to make a comeback, and touch $1,900 by the end of the year – a surge of more than 700% from its current price.