The distance from 47.9 to 50 in ISM: Tom Lee's view on the trigger for the new Bitcoin cycle in 2026

Wall Street renowned strategist Tom Lee’s recent views have attracted market attention: he believes that the U.S. economy may be at a critical turning point, and the key indicator for this turning point is the ISM Manufacturing Purchasing Managers’ Index (PMI). Currently, the ISM has been hovering below 50 for over three years, with the latest reading at 47.9. Once this indicator breaks above 50 into the expansion zone, Tom Lee predicts it will trigger a new cycle for Bitcoin and the entire risk asset market. The logic behind this judgment is worth a deep understanding.

ISM Index: An Undervalued Market Trigger

Why is the ISM so important

The ISM Manufacturing PMI is regarded as a “weather vane” for the U.S. economy. An index above 50 indicates that manufacturing is entering an expansion phase, business confidence is rebounding, capital expenditures are increasing, and overall economic activity is improving. Conversely, below 50 suggests contraction.

Current data is critical: the ISM has been below 50 for more than three years, indicating that the U.S. manufacturing sector has been in a long-term contraction. The latest published figure of 47.9 remains in the sluggish zone. But the market is highly focused on whether the ISM can re-enter the 50 “line of distinction” in the future.

What would change if the ISM breaks above 50

According to Tom Lee’s analysis, once the ISM returns to the expansion zone, market structure and capital preferences could undergo significant changes:

• Investors will reduce defensive positions
• Increase allocations to stocks, cryptocurrencies, and other risk assets
• Institutional funds will shift from conservative to growth strategies
• Overall risk appetite will significantly increase

Historical Cycle Resonance: A Mirror of 2020

The power of historical comparison

Tom Lee points out that the current environment structurally resembles the post-pandemic impact of 2020. At that time, the scenario was: the ISM index rapidly recovered and entered the expansion zone, followed by a substantial rise in Bitcoin prices from 2020 to 2021, with risk appetite becoming the market’s main theme.

This is no coincidence. When economic data improves, markets automatically reprice risk assets. Bitcoin, as one of the most risk-sensitive assets, often receives the largest capital inflows.

Similarity of the current environment

Why does Tom Lee believe this cycle will repeat? He lists several key factors:

• Global liquidity remains ample
• Institutional funds continue to seek high-return assets
• Cryptocurrency penetration remains relatively low, leaving room for long-term growth
• Institutional participation is deepening, with long-term capital gradually entering Bitcoin and crypto markets

Deepening Institutional Participation Changes the Game

From retail to institutional involvement

Compared to 2020, the biggest change in the current crypto market is the level of institutional participation. U.S. banks have already allowed financial advisors to allocate to Bitcoin ETFs, which is just the tip of the iceberg. Data from Fundstrat shows that continuous inflows of institutional funds make Bitcoin more sensitive to macroeconomic improvements.

What does this mean? When positive signals appear in the ISM data, it is no longer just retail chasing the trend, but systematic allocations by institutions based on macro logic. This will lead to more sustained and larger-scale capital inflows.

Positive signals in the current market

According to the latest data, Bitcoin is currently trading around $92,794, up 4.93% over the past 7 days. The market’s total capitalization has broken through $3.21 trillion, with a 24-hour trading volume of $12.386 billion. These figures reflect the market’s “waiting state” before the ISM breaks through.

Key Points for 2026

Predictions from different institutions

Market mainstream forecasts for Bitcoin’s price in 2026 vary significantly:

Trigger conditions vs. price targets

It should be noted that Tom Lee’s aggressive forecast is based on a premise: the ISM index must enter the expansion zone. This is not a certainty but a probabilistic event. Currently, the ISM is at 47.9, 2.1 points away from 50.

However, this distance is not far in historical terms. If economic data continues to improve, breaking above 50 is entirely possible. Once this trigger condition is met, the market structure will undergo a significant change.

Summary

The ISM index moving from 47.9 to 50 may seem like just a 2.1-point difference, but in Tom Lee’s view, this could be the critical turning point that triggers a new cycle for Bitcoin in 2026. This judgment is supported by three pillars: first, proven historical cycle resonance; second, the similarity of the current global liquidity and institutional participation environment; third, the sensitivity of cryptocurrencies as risk assets to macroeconomic improvements.

Regardless of when the ISM breaks above 50, this indicator has become a key signal for traders and macro investors. Any sustained upward signal could be seen as a trigger for a new wave of risk asset rallies. For investors focusing on the 2026 market, closely monitoring the ISM data trend is highly recommended.