Apple is now the fifth and final FAANG stock that Bitcoin has outperformed. Apple produced a death cross, which is a chart pattern indicating that a major selloff looms on the horizon.
It is the first time in three years that the Apple Inc.’s stock flashed a bearish “death cross”. The death cross suggests that a major sell-off could be around the corner. Meanwhile, Bitcoin’s price climbed more than 10% on December 20.
The crypto and FAANG comparison is appropriate because the cryptocurrency market and tech stocks tend to move in tandem. In fact, the recent downturn in the tech sector was partially blamed for the bitcoin bear market.
FAANG is an acronym for the five best-performing tech stocks in the stock market: Facebook, Apple, Amazon, Netflix and Alphabet’s Google.
Leading crypto markets have dramatically outperformed the ‘FAANG’ stocks since 2017, despite the prevalent bearish swing.
Since the start of 2017, ‘FAANG’ Stocks have stayed Between 25% and 115%. As with the cryptocurrency markets, the FAANG stocks broke into new record highs during early 2017, leading to a multi-month bull trend driven by accelerated momentum.
However, the leading cryptocurrency markets have significantly outperformed the FAANG stocks since the start of 2017; the current posting year-to-date losses between 75% and 90%.
Fundstrat co-founder Tom Lee said in November “As growth stocks, tech, and FAANG come under pressure, it’s going to hurt bitcoin. The downturn in FAANG is hurting those owning bitcoin.”
Apple stock plunged to a 10-month low amid reports that a German court had ordered it to stop selling some of its older iPhones.
The death cross is a fairly accurate predictor of bear markets; it appears when a stock’s short-term moving average crosses below its long-term moving average.
Bitcoin has outperformed Apple since January 2018 as well, despite the bearish market.
Co-founder and CEO of Circle, Jeremy Allaire, believes that Bitcoin will surge over the next three years as institutional investors hop aboard the crypto bandwagon and mainstream adoption grows.
Allaire says the tokenization of financial assets is a growing trend that will gain traction in the near future which will ensure that crypto survives and thrives. Allaire said –
“We have a phrase: the Tokenization of Everything. We think cryptographic tokens are going to represent every form of financial asset in the world. There will be millions of them in years.”