“Long Bitcoin” Overtakes “Long Tech” As Most Crowded US Trade
Tech no longer reigns supreme in the shadowy back streets of Wall Street where secrets are shared and insider tips can make you a fortune. For the first time since October 2019, the most crowded trade in the US (aka the most popular one for fund managers) is no longer long Tech or short dollar. According to CNBC, Tech spent more than a year in the top spot.
Discover what long or short means.
Bank of America
Every month, Bank of America sends out a survey to fund managers asking them for their choices of most popular trades for the moment. During most of 2020, the top spot was taken by Tech as companies like Netflix and Amazon saw their turnovers skyrocket due to the pandemic.
The current price of Bitcoin is $34,600 and it has dropped almost 7% in the past 24 hours.
As Wall Street jumps on the Bitcoin rally,UBS warns prices may rise in the near term, but the industry faces existential risks over the long haul when a better designed version is launched or if regulatory changes stifle sentiment pic.twitter.com/akZGr9lDTf— Ajay Bagga (@Ajay_Bagga) January 16, 2021
However, this sentiment is not shared on both sides of the Atlantic. In Europe, it is mostly the monthly survey by Deutsche Bank that is seen as the trustworthy one. In the old continent, many claimed that Bitcoin was entering bubble territory with, according to Reuters, no less than:
56% of the participants saying the cryptocurrency was more likely to halve in value in the next 12 months.
Looks like the mood in the US is risk-on now that Biden is the incoming US President, whilst Europeans are going risk-off now that a possible third corona wave is set to wreak havoc.
Back in the summer of 2020, the most popular trades in the US were already Bitcoin and Tesla. By now that has become Bitcoin and Tech. The third most popular trade at this moment is to short the US dollar.