Looking at the return on investments (ROIs) of multiple asset classes, it is evident that cryptocurrencies and technology stocks are outperforming other assets by a landslide. New asset classes which are genuinely better than traditional ones, or able to grab the future tend better, we call these the “Disruptive Assets.”
One of the traditional asset classes that has been heavily damaged by the on-going pandemic and brewing economic crisis is none other than the banking sector. Disrupted by newer and better technology where the private sector is continuously pushing out new financial products, services and offerings as greater alternatives to those provided by traditional banks does not help its case either.
As part of the technology revolution and developments in smart money and more, younger investors are looking ahead into the future. A future where Tesla’s electric vehicle, for example, will soon replace ICE engines. As a testament to this, Tesla stock (TSLA) offered a 400% YTD return this year. Similarly, this is a future where faster, cheaper, and more secure cryptocurrencies are slowly gaining ground in the financial world, possibly at the expense of fiat currencies and physical banknotes.
Not to mention decentralized finance (DeFi), which despite being in its nascent stage, will one day, potentially replace traditional banking services.
So far, 2020 has proven to be a turning point as it brought new methods of wealth management and transfers to regular citizens, driving them to give considerable thought to the way blockchain and cryptocurrency are reshaping the world as we know it.
Bitcoin Technical Analysis
Bitcoin (BTC) smashed through the previous yearly high in full force and subsequently created a new 2020 high at $13,360 on October 25. Now Bitcoin is relentlessly heading toward the 2019 highs at $13,200 and $13,900 with tremendous strength, buoyed by strong market sentiment.
Over the past weekend, BTC experienced a slight pullback as it failed to stand above the first overhead resistance at $13,200 level. The $12,500 level which was once a resistance now turned into a support level where Bitcoin cannot afford to lose.
Currently standing above said support, Bitcoin should now resume a consolidation period where it garners strength for an attempt to test the $13,900 level. The midterm prospect for BTC is now bullish, but if it is able to break above the 2019’s high, this will surely send the crypto bellwether on a full-on bull mode that we last witnessed back in 2017.
Ethereum Technical Analysis
Ethereum (ETH) benefited from the rise of BTC as it caught on with the bullish momentum and rode to $420. Higher highs begin to form on a larger time frame and things are looking great for ETH as long as it manages to stand above the $400 level.
The midterm targets for ETH are located at $450 and $490 respectively. Any further development in DeFi or ETH 2.0 would be much appreciated as it can help push ETH to these levels.
Important support lies at $380, where breaking below it will force ETH to resume its past sideways price action. However, Ethereum is still one of the best assets in terms of YTD ROIs at a jaw-dropping 200%.
Disclaimer: This analysis is the view of the author’s alone, and does not in any way represent trading advice. all traders should trade at their own risk.
You may also want to read: 2020 is a Great Year for Crypto and Tech Stocks, not So Much for the Banks