FAANG stocks are expected to continue with the 2020 rally as their demand prevails on the ground.
The third stimulus package is in its final stages to be approved by the United States Congress. Most of the FAANG stocks have been trapped in a consolidation level, as investors and analysts analyze most companies’ fourth-quarter earnings results. Notably, there have been speculations that huge companies included in the FAANG stocks are looking into adding Bitcoin (BTC) to their balance sheet to diversify and reduce their risk.
As the Fed gets to inject another $1.9 trillion in the market, the United States dollar is expected to fall further in the coming quarters. Holding fiat is no longer a better option for most companies. Adding assets like Gold, Bitcoin, and other cryptocurrencies are becoming the new order.
Tesla Inc (NASDAQ: TSLA) led the way by purchasing $1.5 billion worth of Bitcoin from Coinbase earlier this year.
Speculations have been that Apple Inc (NASDAQ: AAPL) might invest in the crypto industry by adding crypto capabilities in its pre-installed wallet. Although Apple, which is a FAANG company, might not add BTC to its balance sheet, its involvement with the crypto industry can be the new fuel needed to continue with the 2020 rally.
Bigger Picture on the FAANG Stocks amid BTC Adoption
Demand in the technology industry is rising as the global market shifts towards cloud computing. Amazon.com Inc (NASDAQ: AMZN) has significantly invested in cloud computing to tap on businesses that want to work remotely and scale their operations.
Alphabet remains a critical pivotal stock for the FAANG family. The company has significantly diversified in most needed services including artificial intelligence to facilitate Web 3.0 adoption. “Google has been the leader in this space, they really don’t have any kind of competition – yes, companies can try to create their own avenues, but I do think that Google is going to continue to remain the leader,” said Danielle Shay, director of options at Simpler Trading.
Coronavirus is still giving companies a nightmare due to lack of uncertainty, however, FAANG stocks are likely to benefit from the lack of uncertainty as they provide much-needed services. Netflix Inc (NASDAQ: NFLX) is a major backbone of the FAANG stock, as people continue to stay at home due to the ongoing coronavirus pandemic.
Notably, investors are starting to diversify out of the FAANG stocks based on favoring fundamentals on the ground. Microsoft Corp (NASDAQ: MSFT) and NVIDIA Corp (NASDAQ: NVDA) are emerging as likely winners. Essentially due to the high demand for software-related packages and electronic chips. As a result, the FAANG acronym was rearranged to FANGMAN stocks to include the Microsoft and Nvidia stocks. FAANG stocks are expected to continue with the 2020 rally as their demand prevails on the ground.
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