Bitcoin price rose more than 36% since the year’s beginning while the shares of banking giants have experienced huge fallings.
Bitcoin seems to be more money-making than some of the world’s biggest bank stocks, even though the harsh fall struck the first cryptocurrency in the middle of March.
Ryan Selkis from the cryptocurrency research company Messari tweeted:
The "Pomp trade" having an epic year.
“Long bitcoin, short the bankers”
cc: @APompliano pic.twitter.com/YlCSLkT2pf
— Ryan Selkis (@twobitidiot) May 18, 2020
Just for comparison, Bitcoin’s price rose more than 36% since the year’s beginning, and the shares of banking giants experienced huge fallings. For example, the shares of JPMorgan Chase & Co (NYSE: JMP) are 37% cheaper than in January, and Wells Fargo & Co (NYSE: WFC) lost over 55% of its market value.
The selling-off that happened in the banking sector was mainly caused by the effects COVID-19 pandemic had on the economy. The cryptocurrency experts believe that Bitcoin and gold will somehow profit from the crisis as they will serve as safe haven and a certain hedge against inflation.
Will BTC Finally Pass $10K Limit?
At the time of writing, BTC/USD is changing hands at $9,786, up 1.95% on a day-to-day basis. The first digital asset managed to recover from the intraday low of $9,450 and settle above $9,990, however, the upside momentum seems to be limited. We shall see if the price gaining ground above $9,800 will get a chance for another try at $10,000.
On the other hand, we cannot forget the fact that the critical support area is created by 38.2% Fibonacci retracement at $9,300. It is followed by a psychological $9,000. If we take the fact that the downward-looking RSI on the daily chart, we can expect BTC to become vulnerable to losses to come within the current range.
Analysts believe Bitcoin is a special kind of safe haven. Still, when other safe havens tend to show negative interactions with so-called risk assets like stocks or oil or high-yield bonds, Bitcoin favors showing no correlation to anything except other cryptocurrencies. You can read more about BTC in our Bitcoin news section.
Bitcoin and Bank Stocks
Gold in the last few days hitting a seven-year high, bursting through the $1,700-per-ounce mark for the first time since December 2012.
Still, even though traditional investors were always tending to stocks of banks finding them safer, this seems not to be the case. Ask Warren Buffett if you don’t believe it.
The Oracle of Omaha has grown his net worth from around $10,000 to a hearty $70 billion. Even though Buffett has traditionally been a net buyer of equities and a strong believer in the long-term outlook for the U.S. economy, the company’s filings with the Securities and Exchange Commission (SEC) in the few recent quarters have shown plenty of selling activity among Berkshire’s bank stock holdings.
Let us explain this for a bit. Between May 11 and May 12, Berkshire Hathaway disposed of 497,786 shares of U.S. Bancorp (NYSE: USB). Then, in time between April 7 and April 8, Berkshire sold 869,103 shares of Bank of…
Read more:Bitcoin Is More Profitable to Invest Into than Bank Stocks
