Japanese Investment Bank Nomura To Launch Bitcoin, Crypto Subsidiary

Key Insights:

  • Reportedly, Nomura is set to launch a crypto arm to offer institutional clients BTC and other digital asset services.
  • The wholly-owned unit will have a staff of a hundred by next year.
  • Nomura executed started trading crypto derivatives last week.

Japan’s largest investment bank Nomura has announced the launch of a new extension focused on cryptocurrencies, decentralized finance (DeFi), and non-fungible tokens (NFTs).

Targeting Institutional Clients

Nomura Holdings, Inc is a Japanese financial holding company and a principal member of the Nomura Group. According to a report from the Financial Times, Nomura is launching a new subsidiary focused on institutional client services for bitcoin and other cryptocurrencies.

Reportedly, Nomura plans to have around 100 people working for the subsidiary by the end of 2012. While the current executives will be primarily responsible for running the company, sources close to the firm have revealed that there are plans for extensive outside hiring.

Just last week, the Japanese investment bank began trading cryptocurrency derivative contracts. This strategic move placed the bank on track with competitors such as Goldman Sachs (GS) and JPMorgan (JPM), giving clients a way to access the cryptocurrency market.

Nomura’s current Chief Digital Officer for its wholesale business, Jez Mohideen, will head the new project. That said, for now, it is reported that fifteen current staff members will be transferred to Nomura’s yet-unnamed crypto company.

Crypto Firms Increase Offerings Despite the BTC Fall

After launching over-the-counter cryptocurrency derivatives with bitcoin (BTC) non-deliverable forwards and non-deliverable options for clients in Asia out of Singapore, the bank has yet again accelerated crypto growth.

Seemingly, despite the recent market volatility and loss in market cap, Nomura has continued to make advancements in the space. The firm also recently announced its first bitcoin futures and options trades on the Chicago-based exchange CME.

Reportedly, the trades were made via Cumberland, the crypto arm of trading firm DRW.

Apart from Nomura, Goldman Sachs and JPMorgan are among other top players that have also been developing their crypto-asset offerings lately.

Rivian Is Down By 15%, Here Is Why

Key Insights

  • CNBC reported that Ford decided to sell 8 million Rivian shares. 
  • The report also indicated that another investor was willing to sell 13 million – 15 million shares. 
  • Rivian’s market capitalization exceeds $20 billion despite the huge pullback from all-time highs. 

Rivian Stock Falls As Ford Is Selling 8 Million Shares

Shares of Rivian gained strong downside momentum after a CNBC report indicated that Ford  would sell 8 million Rivian shares. The shares would be sold through Goldman Sachs. In addition, the report indicated that an unknown seller would be selling 13 million – 15 million Rivian shares through JPMorgan.

Ford owns 102 million shares of Rivian, so the automaker decided to sell about 8% of its current stake in the EV company. Rivian stock had a great debut in late 2021 and touched highs near the $180 level but lost momentum and has been declining for months.

Not surprisingly, traders rushed to sell Rivian stock after the CNBC report was released. The general bearish market sentiment added to pressure, and the stock moved below the $25 level.

What’s Next For Rivian Stock?

The current market environment is bearish for stocks like Rivian. The company is not expected to become profitable anytime soon, while the market is focused on finding safe-haven plays in the rising interest rate environment. In addition, analyst estimates for Rivian have been declining in recent months.

Ford’s decision will certainly serve as a major red flag for many investors, and the stock could remain under strong pressure in the upcoming trading sessions. The CNBC report indicated that Ford was not the only company that was willing to sell shares, which will increase traders’ concerns.

It should be noted that Rivian is valued at more than $22 billion even after the huge pullback. The company has not reached mass production levels, and it remains to be seen whether the market is willing to support such enterprises in the current environment. While the pullback from $180 to $25 may look like a great opportunity to buy Rivian stock, traders must stay cautious as Rivian remains a richly valued company.

For a look at all of today’s economic events, check out our economic calendar.

Coinbase Backs Bitcoin Loans for Wall Street Bank Goldman

Key Insights:

  • Coinbase will be working with Goldman Sachs on Bitcoin loans.
  • Wall Street banks are seeing more demand for crypto facilities and services.
  • Bitcoin prices have fallen to a 7-week low, and Coinbase stock is up marginally.

Last week, Goldman announced its first-ever Bitcoin (BTC) backed loan in which the king of crypto would be used as collateral to secure a cash loan for the borrower.

It has now been revealed that America’s largest exchange Coinbase will be working with the Wall Street bank on crypto-collateralized loans; however, the terms of the lending facility have not been disclosed.

On May 3, Brett Tejpaul, head of Coinbase Institutional, told Bloomberg:

“Coinbase’s work with Goldman is a first step in the recognition of crypto as collateral which deepens the bridge between the fiat and crypto economies,”

Bridging The Gap

Bitcoin-backed loans are not new to the crypto industry, but they are to Wall Street. The move signals that big banks are finally warming to crypto and broadening their services to incorporate institutional clients with digital asset investments. Earlier this week, JPMorgan CEO Jamie Dimon said that crypto was more efficient than banks for international transfers.

Goldman already has a team focused on crypto and traded its first-ever over-the-counter (OTC) Bitcoin options in March, becoming the first major U.S. bank to do so.

Loans in the crypto sector usually involve borrowers supplying Bitcoin at loan-to-value in the 40% to 60% range. This is according to the managing director of trading and lending at crypto prime brokerage Genesis, Matthew Ballensweig, who added:

“Tenors can vary as well as other prepayment terms, but it’s a simple structure to bring institutional lenders into the market,”

Coinbase (COIN) has already structured similar crypto loans with crypto-friendly banks such as Silvergate Bank and Signature Bank, and similar structures with large investment banks are being developed.

Coinbase held more than $566 million in crypto assets, including more than $183 million worth of Bitcoin at the end of 2021. It also reported cash equivalents in the $7 billion range, making it a prime candidate for providing collateral.

Crypto Mortgage Risks

In a related matter, Weiss Ratings agency has recently issued a warning over using Bitcoin and crypto assets to back loans for real estate. The research firm advised caution with such mortgages, citing declines in stock and crypto markets this year, a U.S. housing bubble, rising interest rates, and the Federal Reserve’s upcoming policy changes.

Bitcoin prices have retreated again today, falling a further 1.3% to dip below $38,000 for the first time since mid-March. Coinbase stock had gained 2.17% to reach $123.5 in after-hours trading.

US Labor Department Raises Concern Over Fidelity Crypto Investment Product

Key Insights:

  • Fidelity Investments announced plans to enable Bitcoin investment with 401(K) plans in the US.
  • News of the option to include Bitcoin in its 401(K) accounts has raised concerns.
  • Last week, Fidelity Investments launched Web3-focused ETFs targeting younger clients.

It has been a busy final week of the month for the financial industry and the crypto market.

This week, US investment bank Goldman Sachs announced it was exploring the tokenization of financial securities. Last month, Goldman carried out its first over-the-counter (OTC) trade with Galaxy Digital.

On Thursday, Wall Street’s crypto first-mover Goldman offered its first Bitcoin (BTC) backed loan facility on Thursday.

Also taking strides into the crypto world is Fidelity Investments. Fidelity’s latest move, however, has caught the eye of the US Labor Department.

US Labor Department Raises Concerns over Fidelity’s 401(K) Plans

On Thursday, the Wall Street Journal reported concerns among Labor Department officials about Fidelity Investment’s plan to allow investors to put Bitcoin (BTC) in their 401(K) accounts.

According to the report, acting assistant secretary of the Employee Benefits Security Administration, Ali Khawar, said,

“We have grave concerns with what Fidelity has done.”

Khawar reportedly also discussed the hype around Bitcoin and the broader crypto market and the speculative nature of cryptocurrency investments.

The US Labor Department responded to news of Fidelity’s plans to widen the crypto net.

This week, Fidelity Investments announced plans to offer digital asset investment as part of US retirement plans.

According to the report, MicroStrategy has already signed up for the offering. It remains to be seen whether the Labor Department will scupper Fidelity’s goal to offer crypto to a wider investment audience.

Fidelity Investments Goes All in on Crypto and Web3

Last week, Fidelity Investments launched two web3 ETFs to target a younger customer base.

Fidelity Investments launched the Fidelity Crypto Industry and Digital Payments ETF (FDIG) and the Fidelity Metaverse ETF (FMET).

Both ETFs have a net expense ratio of just 0.39 and provide investors an easy opportunity to gain exposure to cryptos and web3. The latest offering followed some bullish projections on the metaverse.

US banking giants Citi and JPMorgan have drawn headlines with bullish projections for the metaverse.

In March, Citi projected a $13 trillion metaverse by 2030, with JPMorgan projecting a $1 trillion in metaverse-related yearly revenues.

Goldman Sachs Approves First Bitcoin-Backed Loan Facility

Key Insights:

  • This week, Goldman Sachs issued its first Bitcoin (BTC) backed loan.
  • The collateralized facility includes 24-hours risk management
  • Goldman Sachs continues to push the envelope as it explores the tokenization of financial instruments.

Goldman Sachs is taking big strides in becoming a leading bank in the digital asset space. In May 2021, the US investment bank rebooted its cryptocurrency desk in response to improving crypto market conditions.

Goldman first established a crypto desk in 2018.

This week, Goldman took another big step into the digital asset world.

Goldman Sachs Issues Bitcoin-Backed Cash Loan

On Thursday, news hit the wires of Goldman Sachs offering its first Bitcoin (BTC) backed loan facility.

According to the report, the borrower pledged Bitcoin as collateral in a cash loan.

As a first-mover on Wall Street, the bank reportedly found the deal interesting due to its structure and need for 24-hour risk management.

The latest link between digital assets and fiat follows last month’s first over-the-counter (OTC) crypto trade with Galaxy Digital. According to the CNBC report, Goldman was “the first major US bank to trade crypto over the counter.”

This week, there was also news of Goldman Sachs exploring the tokenization of financial instruments.

While Goldman Sachs may be a first-mover among the banking fraternity, crypto-linked financial products are becoming more commonplace.

Crypto-Linked Financial Products Are More Mainstream than Ever

It is a busy year for cryptos and financial institutions.

This week, DeFi protocol Portal partnered with HighCircleX (HCX) to tokenize pre-initial public offering (IPO) company stocks. The partnership addresses the issue of illiquidity by tokenizing pre-IPO stocks. HCX marketplace then supports the trading of the tokenized assets.

In April, crypto firm XBTO offered Bitcoin collateralized mortgages in Miami. The product allows Bitcoin holders to avoid capital gains tax and benefit from any upward trend in Bitcoin value.

According to Thursday’s Bloomberg report, the co-president of Galaxy Digital Holdings Damien Vanderwilt recently said,

“Lending to companies that provide virtual currencies as collateral is the next step.”

With US banking giants Goldman Sachs, JPMorgan, and Citi also bullish about NFTs and metaverse, we expect more bank-linked digital and virtual news to hit the crypto wires in the months ahead.

Bitcoin Price Action

At the time of writing, Bitcoin was down by 0.10% to $39,715.

BTCUSD 290422 Daily
Bitcoin continues to struggle, with resistance at $40,000 now key.

Technical Indicators

Bitcoin will need to avoid the day’s $39,678 pivot to target the First Major Resistance Level at $40,461. Bitcoin would need broader market support to a return to $40,000.

In the event of an extended rally, Bitcoin could test the Second Major Resistance Level at $41,173 and resistance at $41,500. The Third Major Resistance Level sits at $42,668.

A fall through the pivot would bring the First Major Support Level at $38,968 into play. Barring another extended sell-off, Bitcoin should avoid sub-$38,000. The Second Major Support Level at $38,186 should limit the downside.

BTCUSD 290422 Hourly
A fall through the pivot would bring support levels into play.

Looking at the EMAs and the 4-hourly candlestick chart (below), it is a bearish signal. Bitcoin sits on the 50-day EMA, currently at $39,759. This morning, we saw the 50-day EMA narrow to the 100-day EMA, delivering support. The 100-day EMA pulled back from the 200-day EMA, BTC negative.

A move through the 100-day EMA at $40,420 would support a run at $42,000.

BTCUSD 290422 4-Hourly
A move through the 100-day EMA is needed to shift sentment.

Goldman Sachs Explores the Tokenization of Financial Instruments and NFTs

Key Insights:

  • Goldman Sachs looks into the tokenization of financial instruments into digital assets.
  • US banks have become particularly bullish on Web3, with Goldman, JPMorgan, and Citi dishing out hefty projections.
  • The increased interest comes despite a pickup in government and regulatory scrutiny.

Momentum in the digital asset space has picked up through the year. The number of industries showing interest in digital assets and the metaverse continues to rise, with no immediate signs of a slowdown.

NFT and metaverse-related trademark filings continue to grab the crypto news headlines, as do government measures to curb the uptrend in illicit activity.

For US banks, the outlook is bullish, with banks seeing Web3 as the future of the internet as we know it today.

Goldman Sachs Looks into Tokenizing Financial Instruments

This week, US banking giant Goldman Sachs announced that it is exploring the “tokenization of real assets” and NFTs.

Goldman Sachs global head of digital assets Mathew McDermott reportedly said,

“We are actually exploring NFTs in the context of financial instruments, and actually there the power is actually quite powerful. So we work on a number of things.”

Goldman Sachs is not holding back on cryptos, NFTs, and the metaverse. In January, the US investment bank reportedly called the metaverse an $8tn opportunity.

To date, Goldman Sachs has not only invested in crypto start-ups but has also offered crypto-related financial instruments, including Bitcoin (BTC) derivatives and OTC crypto-trading services.

Goldman Sachs Joins a Growing List of US Names Exploring NFTs

Since the evolution of non-fungible tokens, the subject of tokenization of assets has become a popular one. NFTs are industry agnostic, with the concept of tokenization offering boundless opportunities.

While there have been plenty of live cases of successful tokenization of assets, the tokenization of financial instruments has drawn greater interest in recent months.

This week, DeFi protocol Portal partnered with HighCircleX (HCX) to tokenize pre-initial public offering (IPO) company stocks.

Portal’s Executive Chairman Dr. Chandra Duggirala said,

“Portal is bringing real world use cases to Bitcoin. Eventually, we will see tokenization of many more financial assets onto the Bitcoin blockchain. Although these assets are not bearer assets like Bitcoin, having both digital asset securities and non-security digital assets available through a simple interface for users who meet accreditation investor criteria marks the beginning of merging Bitcoin ecosystem with mainstream finance. This also fixes the problem of liquidity fragmentation across many different exchanges and applications.”

Addressing the issue of illiquidity, the tokenized assets are then tradeable on the HCX marketplace, offering holders liquidity.

When considering the speakers at this week’s Financial Times Crypto and Digital Assets Summit, activity in the digital asset space is likely to accelerate this year.

Key speakers included politicians, founders of blockchain entities and crypto exchanges, as well as representatives from the banking sector.

Stock Markets: Top 3 Things You Need To Know This Week

Keep in mind, this week is the official start of the US corporate earnings season and at the same time, there is going to be a lot of economic and inflation data being released as well as the latest headlines regarding Russia’s war in Ukraine.

It is also a short trading week with stock, bond, and commodity markets closed on Friday for Good Friday, which could bring some added volatility as we get closer to the long weekend.

SP500 Earnings

Most Wall Street traders recognize that the S&P 500 rally off the March 2020 lows was built on extremely strong US corporate earnings power. Several traders and investors are quick to remind us that prior to the Covid outbreak S&P 500 company earnings were averaging around $40/share per quarter. Fast forward to our last earnings report that showed 2021 Q4 earnings and we see an average of $55/share. In other words, there was a +38% jump in earnings from before the pandemic to our last quarterly estimates, which puts us fairly in line with the current price level of the S&P 500. The question is can US corporate earnings continue to show growth?

I worry because interest rates are starting to aggressively creep higher, wage inflation is real, energy inflation is real, the cost of doing business is obviously higher and supply chain dislocations are still creating supply-side imbalances.

China in the Spotlight

Remember, China’s lockdown in Shanghai continues. The lockdown began on March 28 in half the city but has since expanded to its entire population of around 26 million. A trucker shortage and closures of warehouses in Shanghai are also affecting nearby provinces of Zhejiang and Jiangsu, according to a recent note from Citigroup analysts.

The two provinces are major manufacturing hubs that produce about one-third of China’s total exports. Shipping experts warn the fallout will start to be felt in the months ahead as severe dislocations once again drive up shipping costs and exacerbate shortages of raw materials and other essential supplies. There are also lingering concerns about energy prices as Europe continues to debate the possibility of banning Russian oil and gas supplies. Such a move could bring another dramatic rise in prices as available global supplies get spread even more thin.

Data to Watch

The Atlanta Fed is now forecasting just +1.1% Q1 US GDP growth, whereas, three of their last four Quarterly readings were all above +6.1%. At the same time, there are a lot more investors and economists also starting to walk back their global economic growth estimates. Several sources are thinking Ukraine’s economic output will likely contract by -40% to -50%.

More economists are also forecasting a double-digit reduction in Russia’s GDP, as well as much larger reductions in countries like Belarus and Moldova. Growth estimates in the Central Europe region i.e. Bulgaria, Croatia, Hungary, Poland, and Romania are also starting to be reduced.

There was also more talk over the weekend that Russia could eventually start to default on some of its “external debt” for the first time since 1917.

As for this week, all eyes will be on Consumer Price Index, scheduled for release Tuesday morning, and the Producer Price Index scheduled for release Wednesday morning. Both will work to add a bit more color to our current inflation debate.

Also on Wednesday, we get the first batch of Q1 earnings from a few big names like JPMorgan, Black Rock, Bed, Bath & Beyond, and Delta. Then on Thursday the trade will be digesting the latest Retail Sales data and another round of earnings from names like Citigroup, Wells Fargo, Goldman Sachs, Morgan Stanely, and United Health Group.

Keep in mind, several of the largest US banks might be reporting their biggest slowdown in investment banking revenue in years, as more and more “deals” have been getting put on the back-burner. Who knows how long this slowdown will last?

For a look at all of today’s economic events, check out our economic calendar.

Robinhood Is Down By 7%, Here Is Why

Key Insights

  • Goldman Sachs downgrades Robinhood due to slower user growth and weakening user engagement. 
  • Analyst estimates have started to move higher but failed to provide any support to the stock.
  • The rising interest rate environment will likely continue to put pressure on Robinhood shares. 

Robinhood Falls After Goldman Sachs Downgrade

Shares of Robinhood  gained strong downside momentum after Goldman Sachs downgraded the stock from Neutral to Sell.

According to Goldman Sachs, the company is facing weaker user growth, while user engagement is slowing down as well.

At the end of March, Robinhood announced that it would expand pre-market trading to 7 a.m. from 9 a.m. ET and after-hours trading to 8 p.m. ET. This announcement served as a major positive catalyst for the stock, which was up by 25% on the news.

However, the stock failed to develop additional upside momentum and found itself under significant pressure at the start of this month. Goldman Sachs’ downgrade served as an additional bearish catalyst and pushed Robinhood shares below the $11.50 level.

What’s Next For Robinhood Stock?

Analysts expect that Robinhood will report a loss of $1.25 per share in the current year and a loss of $0.67 per share in the next year, so the company is not expected to become profitable anytime soon.

It should be noted that analyst estimates have recently improved due to the company’s above-mentioned announcement. However, this improvement was not sufficient enough to provide any material support to the stock.

The yield of 10-year Treasuries has already reached the 2.70% level, and it has good chances to move closer to the 3.00% level amid high inflation. The rising interest rate environment is bearish for unprofitable companies, and it remains to be seen whether speculative traders will rush to buy Robinhood stock at current levels.

For a look at all of today’s economic events, check out our economic calendar.

US FDIC Calls Banks To Notify Their Crypto-Related Activities

Key Insights:

  • US bank insurer wants its client banks to report their crypto activities, including transactions and trading.
  • The FDIC would provide banks with supervisory feedback upon reviewing.
  • The regulator is concerned about crypto risks like safety, financial stability, and consumer protection.

The Federal Deposit Insurance Corporation (FDIC), the US government bank insurer, has asked banks under its supervision to report on crypto activities such as transactions and trading.

Per a letter released by the Corp on Thursday, FDIC-supervised institutions that engage in crypto activities or have plans should provide information on such actions.

“The FDIC will review the information and provide relevant supervisory feedback.”

The affiliated institutions should comply with the FDIC letter, notifying the government body on any crypto-related activities, including Bitcoin transactions and trading, maintaining stablecoin reserves, and issuing crypto and other digital assets.

Significant Risks

The FDIC letter arrives due to rapidly evolving risks in these activities and concerns about whether the crypto space is not well understood, given limited experience in the nascent space.

The release stated,

“Crypto-related activities may pose significant safety and soundness risks, as well as financial stability and consumer protection concerns. Moreover, these risks and concerns are evolving as crypto-related activities are not yet fully understood.”

FDIC regulates a slew of US-based banks, including national banks and financial behemoths such as the Bank of America and Goldman Sachs.

However, the FDIC isn’t the only banking regulator in the US keen on focusing crypto-related activities. Michael Hsu, head of the Office of the Comptroller of the Currency (OCC), recently warned banking entities that trading crypto derivatives could bring more regulatory scrutiny.

In February, the insurance corporation said that the federal banking agencies need to carefully consider risks posed by crypto products and “determine the extent to which banking organizations can safely engage in crypto-asset-related activities.”

Yellen’s Call for Digital Asset ‘Oversight’

The FDIC letter shortly follows Yellen’s remarks on how regulatory frameworks would need to reflect the risks of crypto activities appropriately.

Treasury Secretary Janet Yellen said during a Thursday speech that crypto regulations must keep pace with innovation to ensure that financial stability and consumer protections are in place.

She said at American University in Washington, DC,

“Our regulatory frameworks should be designed to support responsible innovation while managing risks—especially those that could disrupt the financial system and economy.”

Yellen emphasized the need for a regulatory framework that is “tech neutral” – based on risks and assets rather than technologies.

Goldman Sachs To Offer Ethereum Fund by Galaxy Digital to Clients

Key Insights:

  • Goldman Sachs is set to offer clients access to an Ethereum fund issued by Galaxy Digital.
  • This is not the first time that Galaxy and Goldman are partnering.
  • Goldman Sachs’ employees are showing increasing interest in crypto.

Financial services giant Goldman Sachs is offering clients access to an Ethereum (ETH) fund issued by Galaxy Digital, according to regulatory documents filed with the US Securities and Exchange Commission (SEC).

Spot Exposure to Ethereum

Clients of Goldman Sachs looking forward to Spot exposure to Ethereum, have been offered space in Galaxy’s ETH Fund. Galaxy Investments disclosed this strategy in a filing on Tuesday, which listed Goldman as a recipient of introduction fees for referring clients to the fund.

According to the amended Form D filing, ‘Goldman Sachs & Co. LLC will receive an introduction fee’ for clients it brings to the ‘Galaxy Institutional Ethereum Fund.’

Galaxy Digital Holdings Ltd is a US-based crypto-focused financial service provider founded by Mike Novogratz. The firm had $2.8 billion assets under management at the end of Q4 2021.

According to the filings, the Galaxy fund has managed to sell over $50 million to 28 clients, with a minimum investment of $250,000.

However, for now, it isn’t clear if Goldman had directed any investment since the investment bank was not involved when Galaxy Digital launched the fund.

Additionally, independent wealth management firm CAIS Capital was also listed on the filing as a recipient of ‘placement fees’ for referring its clients to Galaxy’s ETH Fund. CAIS is separately involved in a different Galaxy-backed Ethereum fund whose filing also came out on the same day.

However, Goldman’s introduction fee and CAIS’s placement fee remain undisclosed.

Not the First Partnership

The recent partnership is not Goldman Sachs and Galaxy Digital’s first partnership. In June 2021, Goldman began offering Bitcoin (BTC) futures trading via CME Group Bitcoin Futures, with Galaxy Digital providing liquidity.

Notably, Goldman’s employees have shown interest in the evolving crypto space. On February 25, Roger Bartlett announced his exit from the traditional financial firm and joined crypto exchange Coinbase instead.

Bank of America Says Bitcoin Trades as a Risk Asset

Since the crypto market has become more popular, Bitcoin is one of the principal topics to discuss when it comes to this market.

Alkesh Shah of Bank of America said that Bitcoin has traded as a risk asset since June of 2021. Although its price volatility has fallen since 2013, it is still very volatile compared to S&P 500, Nasdaq 100, and Gold, commented Shah on the research note.

With the bitcoin price being highly volatile, Shah said that Bitcoin would be less traded as an inflation hedge in developed countries, except in countries with “inflationary environments,” which some investors may view it as an inflation hedge.

Alkesh Shah is the head of the Global Cryptocurrency and Digital Asset Strategy research in Bank of America that was launched in October 2021. Simultaneously with the launch, a report called “Digital Assets Primer: Only the first inning” was published.

What Are the Other Banks Saying?

JPMorgan recently estimated that Bitcoin’s “fair value” is about $38,000, when it is trading at the time of writing at $44,008.38. The estimation is based on Bitcoin price volatility being almost four times as gold. The news also said that Bitcoin could reach $150k as a long-term target.

Wells Fargo published a report earlier this week called “Cryptocurrencies – too early or too late?”. The report commented that Bitcoin is perhaps one of the least volatile cryptocurrencies, but “it is still roughly four times more volatile than gold”.

Last month, Goldman Sachs said that Bitcoin will compete with gold as a store of value. As crypto adoption continues, parts of Gold market capitalization will shift into Bitcoin.

BTC Is Up 14.5% in the Last Seven Days

BTC is the biggest cryptocurrency by market capitalization with $835 billion, according to CoinMarketCap. It is trading at $44,008.38 and is up 1.30% in the last 24 hours.

The cryptocurrency is still down 36.12% from its all-time high of $68,900 in November 2021. Since hitting its all-time high it has been in a descending channel until it found support around $35,000 in mid-late January. Then it started an ascending channel, as you can see below:

BTC/USD Chart – Source: FXEmpire.

One sure thing is that banks think of Bitcoin as a highly volatile asset when it compares to traditional financial markets.

If Bitcoin adoption continues and the overall crypto market matures, volatility might decrease.

90 Year Old New York Bank To Offer Bitcoin Services Within 2 Months

As multiple countries such as Russia, Indonesia, and more continue to take a stab at crypto and its adoption, other events counter the effects. One such event is the announcement by Flushing Bank of its plans to offer Bitcoin services to its customers.

Bitcoin FUD About To Be Flushed

The parent company behind the Flushing Bank, Flushing Financial Corporation, made the announcement today as the bank entered into an agreement with Bitcoin company NYDIG. The deal is aimed at providing Bitcoin-based services to its customers. 

The President and CEO of the Flushing Financial Corporation stated during the announcement:

“Using NYDIG’s innovative technology to provide seamless access through our relationship with Q2, our online banking provider, we will be able to offer our customers the ability to buy, sell, and hold bitcoin. This partnership provides our customers with a fully integrated solution to conduct bitcoin transactions in a safe and secure environment.”

In response to the announcement, the CIO of NYDIG stated:

“Consumer interest in bitcoin is growing rapidly and NYDIG has the tools and expertise to help community banks meet that demand. Together with forward thinking institutions like Flushing Bank, we’re on the path to achieving our mission of bitcoin for all.”

The Bank has already established its roots in Queens, Brooklyn, Manhattan, and Long Island, and with these services, its presence could expand if investors are interested in these Bitcoin services.

The crypto adoption in NYC has been growing with the city’s mayor, Eric Adams, himself accepting his paycheck in Bitcoin recently. And this announcement could draw the attention of more people towards crypto.

Not the First Bank Though

Even before the Flushing Bank, many other significant banks announced their involvement with cryptocurrencies, including Standard Chartered, Citibank, JPMorgan Chase, Goldman Sachs, etc.

Just recently, the Bank of America too agreed that the evolution of digital currencies at the moment makes a United States own CBDC inevitable in the future.

All these adoptions provide crypto-invested investors a lot of hope for mainstream adoption.

Blockchain.com Adds a Former Walmart Director to its Board

The cryptocurrency and blockchain industry has seen an influx of experts from traditional financial institutions over the past few years, and the trend could continue.

Horton Joins the Blockchain.com Team

Cryptocurrency startup Blockchain.com has announced the addition of Tom Horton to its board. Horton is an independent director from Walmart and has become the latest executive from a traditional company to join a crypto startup.

The Walmart director now joins a host of other executives on Blockchain.com’s board. The company recently added Marcie Vu, former head of consumer Internet banking at Morgan Stanley, to its board.

Other financial backers of the company include Google Ventures, Sir Richard Branson, and Lightspeed Commerce Inc.

Blockchain.com is one of the leading cryptocurrency companies planning to conduct an initial public offering (IPO) in the near to medium term. However, there is no set date regarding the company’s planned public listing.

Horton’s addition to the Blockchain.com board highlights a growing trend in the cryptocurrency and blockchain industry. The past few years have seen numerous mainstream financial institutions and businesses enter the blockchain space.

Visa, one of the leading payment facilitators in the world, launched a cryptocurrency advisory forum towards the end of last year. BlackRock is another traditional financial institution that is currently involved in the crypto space.

MasterCard, PayPal, MoneyGram, Morgan Stanley, Goldman Sachs, and several other traditional financial institutions are currently involved in various crypto-related activities.

The Crypto Market is Slowly Recovering

The cryptocurrency market suffered huge losses over the weekend, but it is now slowly recovering. The total cryptocurrency market cap has climbed above $1.6 trillion again after dropping towards $1.5 trillion yesterday.

Bitcoin declined towards the $33k level but has added more than 8% to its value in the last 24 hours and is now trading at $36,402 per coin. Ether is currently targeting the $2,500 psychological level after rallying by more than 7% in the past 24 hours.

Earnings Season Brings Worries to Wall Street

What is wrong with the banking sector?

Goldman Sachs yesterday became the latest to fan worries about declining profit margins after the bank reported a +33% jump in compensation which contributed to a -13% decline in Q4 profits.

The escalating costs mirror similar results disclosed by fellow big banks JPMorgan and Citigroup, as well as numerous other companies that have already reported or issued earnings warnings in recent weeks.

Just over 4% of S&P 500 companies have released Q4 earnings, and about 60% of those have cited a negative impact from higher labor costs on current and/or expected future earnings.

10-Year Treasury yield

Stock prices are also facing headwinds from a big jump in bond yields. The 10-Year Treasury yield hit 1.88%, the highest since before the pandemic hit and up from a low of 1.36% in early December.

This is largely a reflection of the U.S. Federal Reserve’s more hawkish monetary policy shift that is widely expected to now bring four or five interest rate hikes in 2022. However, there is a lot of uncertainty surrounding the exact timing and degree of those hikes, with many on Wall Street worried that ongoing labor market tightness, supply chain disruptions, Covid-related shutdowns, and geopolitical tensions will continue to drive costs even higher.

That in turn would likely mean even more aggressive action from the Federal Reserve.

There’s a lot of talk that the 10-Year could eventually push to 2.3% or even 2.5%. the market had to deal with a similar jump in the 10-Year back in 2013 during the “Taper Tantrum” or when the Fed had to start reversing their easing policy that had been associated with the US housing crisis global market meltdown.

If you remember, the stock market went through a fairly rough patch that year as the Fed shifted policy but eventually the market selloff stabilized and stocks rebounded to have a good year. this time around, however, many Wall Street insiders are talking about how the double whammy of escalating costs and higher interest rates is driving a shift away from so-called “momentum” stocks and back toward old school investment fundamentals.

Meaning investors are turning away from hot, trendy stocks that have defied gravity-and lacked profits-in favor of companies with proven track records and good cash flows.

Inflation fears are also once again being exacerbated by the oil market with prices hitting a seven-year high, the highest level since October 2014. The latest jump stems largely from deteriorating relations between fellow OPEC members after Yemen’s Iran-aligned Houthi group attacked the United Arab Emirates overnight on Monday. A Saudi-led coalition retaliated with airstrikes on the Houthi group. The renewed tensions between the UAE and Saudi Arabia raise the risk of more disruptions to the already tight global oil supply outlook.

Data to watch

Today, investors will be digesting Housing Starts and Permits for December, both of which are expected to pull back slightly from last months results.

On the earnings front, today’s highlights include Alcoa, Bank of America, Discover, Fastenal, Kinder Morgan, Morgan Stanley, Procter & Gamble, State Street, United Airlines, United Health, and U.S. Bancorp.

I still think there’s some rough sailing and uncertainty in the waters ahead… Also keep in mind, the Nasdaq 100 is quickly approaching its 200-Day Moving Average. Bulls want to argue that we are going to see a big bounce higher once we test that level. Bears argue that a close below that level could bring on a wave of heavy computer based technical selling. I’m not sure who is going to come out correct but I expect we see some extremes as the battle plays out… stay nimble!

Think About This… Perhaps +40% of fund managers have never traded or invested in a rising rate and rising inflation environment.

For a look at all of today’s economic events, check out our economic calendar.

Why Goldman Sachs Stock Is Down By 8% Today

Goldman Sachs Stock Falls As Quarterly Earnings Miss Analyst Estimates

Shares of Goldman Sachs gained strong downside momentum after the company released its quarterly report.

Goldman Sachs reported revenue of $12.64 billion and earnings of $10.81 per share, beating analyst estimates on revenue and missing them on earnings. The company also declared a quarterly dividend of $2.00 per share, in line with the previous one.

The company’s operating expenses increased by 10% in 2021 compared to 2020 levels. Goldman Sachs stated that this increase “[…] primarily reflected significantly higher compensation and benefits expenses (reflecting strong performance)”.

Put simply, Goldman Sachs paid hefty bonuses which put pressure on the company’s earnings. Not surprisingly, the market is not happy to hear this news.

What’s Next For Goldman Sachs Stock?

Analysts expect that Goldman Sachs will report earnings of $40.7 per share in 2022, so the stock is trading at less than 9 forward P/E. This looks cheap for the current market environment, but it should be noted that Goldman Sachs’ earnings are projected to decline from 2021 levels, and the market is often cautious when earnings decline.

I’d also add that major financial stocks like Morgan Stanley and JP Morgan have also found themselves under significant pressure in recent trading sessions, and it looks that the market is skeptical about the near-term performance of this segment.

The market is concerned about the recent increase in Treasury yields. The yield of 2-year Treasuries moved from 0.20% in September to 2021 to 1.05%, which is a major shock for the financial system. Typically, financial firms do well in a higher rate environment while rock-bottom rates hurt their potential, but the market questions whether firms are prepared for a very fast change in Treasury yields.

All in all, it remains to be seen whether speculative traders will rush to buy Goldman Sachs stock which has already declined by almost 20% from the highs that were reached a couple of months ago. In case the broad market pullback continues, the company’s shares will likely find themselves under more pressure.

For a look at all of today’s economic events, check out our economic calendar.

In The Spotlight – Big Wall Street Banks as the Main Power in S&P 500

Banks’ earnings

Big Wall Street banks are in the spotlight right out of the gate with Goldman Sachs set to release results before markets open. They will be followed by Bank of America, Morgan Stanley, and U.S. Bancorp tomorrow (Wednesday). Bank results got off to a mixed start on Friday. JPMorgan Chase, Citigroup, and Wells Fargo all topped profit estimates for Q4 but JPMorgan and Citi delivered disappointments in other areas.

In particular, investors are nervous about higher expenses that cut into Q4 profits for both JPMorgan and Citi and which both banks forecast would continue to weigh on results in 2022. JPMorgan and Citi also saw -11% decreases in trading revenue, with fixed income trading down by double digits for both.

There are also signs of slowing loan growth that some analysts worry is an early sign of slowing consumer demand for big-ticket items as inflation continues to climb. While banks will eventually benefit from higher U.S. interest rates that are anticipated in the year ahead, a big pullback in consumer lending is a threat to some of the more lofty Wall Street expectations had for the sector in 2022.

Global economy

Globally, not a lot changed over the extended weekend. China might have provided a bit of a surprise with additional monetary easing into a struggling GDP and sagging real estate prices. It’s worth noting, Omicron has now been detected in Beijing for the first time, just three weeks before the city is due to host the Winter Olympics. Now the Chinese are shutting down and suspending the sale of Olympic tickets to the public.

Tensions remain heated between Hong Kong activists and Chinese government officials. North Korea launched its fourth missile test this month. After North Korea’s missile test last week, the US announced sanctions on eight North Korean and Russian individuals and entities for supporting North Korea’s ballistic missile programs.

Tensions between the U.S. and Russia seem to be headed in the wrong direction with Russia over the weekend moving troops and equipment into Belarus for joint military exercises.

The so-called “Allied Resolve” drills are set to take place near borders with NATO members Poland and Lithuania, as well as Ukraine where Russia has maintained its alarming military presence.

Most U.S. military experts don’t really think Russia has any real intentions of invading Ukraine or any other EU country. However, Western countries also have increased their military presence along borders and other strategic locations which increases the chances that a broader conflict could “accidentally” be sparked.

Europe’s gas supplies are also at risk as Russia continues to dangle the threat of cutting them off. Most of the tension stems from Russia’s demand that former Soviet countries be barred from entering NATO, something the U.S. and other NATO allies have refused.

In the USA, we are heading deeper into earnings season and investors are going to be paying close attention to costs and expenses. As I mentioned, late last week, JPMorgan warned that higher expenses and higher spending on hiring in 2022 could create some headwinds.

Looking ahead, it will be interesting to see how many executive teams start providing guidance and warnings that corporate expenses are rising faster than anticipated and what if any damage will be due to profit margins?

Remember, some companies have said they are passing the additional rising costs on to the consumer while other companies are eating a majority of the higher expenses in an attempt to gain more market share.

How the stock market decides to differentiate the strategy and style could greatly impact money flow and valuations. Goldman Sachs, J.B. Hunt, Charles Schwab, Citrix, Concentrix, and Interactive Brokers report earnings today.

Data to watch

Tomorrow we have Alcoa, Bank of America, Kinder Morgan, Morgan Stanley, Procter & Gamble, and United Airlines.

Thursday we have American Airlines, Baker Hughes, Netflix, and Union Pacific.

Then next week we have big names like Apple, Boeing, Caterpillar, McDonalds, Microsoft and Verizon reporting earnings.

Let’s also not forget next week we have the first Fed FOMC meeting of the new year.

With the U.S. Federal Reserve getting ever closer to implementing its first rate hikes, which most anticipate will begin in March, investors are growing less enchanted with some of the high-growth and momentum stocks that saw outsized share price gains last year.

This trend is most evident in the tech-heavy Nasdaq where nearly half of the index’s stocks have fallen by -50% from their recent peaks. The Nasdaq itself is only down by about -7% from its most recent record high. The selloff has been very much concentrated in highly-leveraged companies that have yet to deliver a profit, as the prospect of higher rates reduce future profit potential. Earnings results from these high-fliers will likely be harshly scrutinized as Wall Street tries to separate the “wheat from the chaff,” so to speak.

On the economic data front, Empire State Manufacturing and the NAHB Housing Market are today’s highlights.

For a look at all of today’s economic events, check out our economic calendar.

Goldman Sachs Completes Head and Shoulders Top

Goldman Sachs Group Inc. (GS) is trading lower by 4% in Tuesday’s pre-market after missing Q4 2021 earnings-per-share (EPS) estimates by a wide margin. The Wall Street icon posted a profit of $10.81 per-share, $1.07 below expectations, while revenue rose 7.7% to $12.64 billion. The company chatted up investment banking and global markets revenue in the release, forcing analysts to wait for the conference call for an explanation of the profit shortfall.

Fixed Income Trading Slowdown

The stock topped out in August 2021 after more than tripling in price since the March 2020 low, with gains fueled by investment banking booms in the IPO market and mergers and acquisitions group. It fell into the red for 2022 last week, selling off in sympathy with Dow component JPMorgan Chase and Co. (JPM) and Jefferies Financial Group Inc. (JEF) after both houses missed revenue estimates due to a slowdown in fixed income trading.

Bank of America Securities analyst Ebrahim Poonawala downgraded Goldman to ‘Neutral’ when the calendar flipped into January, expecting “a tougher revenue growth backdrop for the capital markets business on the potential for moderating trading activity and deal-making after a record year for IPO and M&A activity. He also warned that “secular re-rating in the stock on the back of revenue diversification (away from capital markets) is likely to be a multi-year event.”

Wall Street and Technical Outlook

Wall Street consensus now stands at a ‘Moderate Buy’ rating based upon 16 ‘Buy’, 1 ‘Overweight’, 10 ‘Hold’, 0 ‘Underweight’, and 0 ‘Sell’ recommendations. Price targets currently range from a low of $330 to a Street-high $598 while the stock is set to open Tuesday’s session more than $90 below the median $462 target. This placement tells us that Goldman is still working off long-term overbought readings after extraordinary gains into the summer of 2021.

Goldman Sachs returned to the 2007 high at 251 in 2017 and failed a breakout attempt in 2018, ahead of a steep decline to a 7-year low during March 2020’s pandemic decline. It finally mounted long-term resistance in January 2021, entering a powerful advance that topped out above 400 in the third quarter. Price action has completed a head and shoulders top since that time, with a breakdown through 365 favoring a steeper slide into the psychological 300 level.

Catch up on the latest price action with our new ETF performance breakdown.

Disclosure: the author held no positions in aforementioned securities at the time of publication. 

Wall Street Week Ahead Earnings: Goldman Sachs, Procter & Gamble, United Airlines, and Netflix in focus

The following is a list of earnings slated for release January 17-21, along with a few previews. A number of big companies will report earnings in the week ahead, including Goldman Sachs and Bank of America, Procter & Gamble, Netflix, and a number of transportation companies. Investors will carefully monitor the latest news on the rapidly spreading Omicron coronavirus variant to see how it affects earnings in 2022.

Earnings Calendar For The Week Of January 17

Monday (January 17)

No major earnings are scheduled for release. The stock market in the U.S. will be closed in observance of Martin Luther King, Jr. Day.

Tuesday (January 18)

IN THE SPOTLIGHT: GOLDMAN SACHS

The New York-based leading global investment bank Goldman Sachs is expected to report its fourth-quarter earnings of $11.89 per share, which represents a year-over-year decline of about 2% from $12.08 per share seen in the same period a year ago.

The world’s leading investment manager would see a decline in revenue of nearly 1% to $11.65 billion from a year ago. It is worth noting that in the last two years, Goldman Sachs has surpassed market consensus expectations for profit and revenue most of the time.

“We expect Goldman Sachs to report mixed results, with revenues outperforming the consensus estimates and earnings missing the expected figure. The investment bank reported better than expected results in the last quarter, with the top-line increasing 26% y-o-y. This was driven by significant growth in the investment banking business, followed by higher global markets and consumer & wealth management revenues,” noted analysts at TREFIS.

“While investment banking grew on the back of growth in mergers &acquisitions (M&A) and equity underwriting deal volumes, global markets benefited from higher equity trading revenues. Similarly, the consumer & wealth management segment gained from an increase in outstanding loan balances. That said, the top-line was partially offset by negative growth in the asset management division, primarily due to lower equity investment revenues. We expect the same trend to continue in the fourth quarter. We estimate Goldman Sachs’ valuation to be around $447 per share which is 14% above the current market price.”

TAKE A LOOK AT OUR EARNINGS CALENDAR FOR THE FULL RELEASES FOR THE JANUARY 18

TICKER COMPANY EPS FORECAST
BAC Bank of America $0.78
SCHW Charles Schwab $0.83
CNXC Concentrix $2.54
HWC Hancock Whitney $1.33
IBKR Interactive Brokers $0.74
JBHT J.B. Hunt Transport Services $2.0
MBWM Mercantile Bank $0.85
ONB Old National Bancorp $0.38
PNFP Pinnacle Financial Partners $1.56
PNC PNC Financial Services $3.62
PRGS Progress Software $0.62
SBNY Signature Bank $3.92
TFC Truist Financial $1.27
UCBI United Community Banks $0.63

 

Wednesday (January 19)

IN THE SPOTLIGHT: PROCTER & GAMBLE, UNITED AIRLINES

PROCTER & GAMBLE: The world’s largest maker of consumer-packaged goods, is expected to report its fiscal second-quarter earnings of $1.66 per share, which represents year-on-year growth of just over 1% from $1.64 per share seen in the same period a year ago.

The Cincinnati, Ohio-based consumer goods corporation would post revenue growth of over 3% to $20.4 billion from a year ago. It is worth noting that the company has consistently beaten consensus earnings estimates in the last two years, at least.

“We believe strategy changes can sustain Procter & Gamble (PG) LT topline growth in the 4% range. In the US, a strong breadth of performance and share gains give us confidence that market share momentum is sustainable and supports LT topline growth above HPC peers. While near-term pressures from commodity/freight inflation will impact margins, we believe PG has stronger pricing power than peers, particularly with share gains,” noted Dara Mohsenian, equity analyst at Morgan Stanley.

PG trades at ~22.5x CY22e EPS, an HSD% discount to HPC peers CLX, CL and CHD, and looks compelling given our call for higher LT PG growth.”

UNITED AIRLINES: The major U.S. airline company is expected to report a loss for the eight-consecutive time of $-2.12 in the holiday quarter as the aviation service provider continues to be negatively impacted by the ongoing COVID-19 pandemic and travel restrictions.

However, that would represent a year-over-year improvement of about 70% from -$7.0 per share seen in the same period a year ago. The Chicago, Illinois-based airlines would post revenue growth of over 130% to $7.94 billion.

“Despite some headwinds around staffing issues, we expect United Airlines (UAL) to guide to a continued sequential improvement with capacity guided to be down in the 17-18% range in Q1, which incorporates domestic capacity down in the 1% range, while international capacity remains down 27%,” noted Sheila Kahyaoglu, equity analyst at Jefferies.

“Remaining in a Net Loss Position into Q1. We expect a continued sequential decline in CASM-ex to 11.63¢, which reflect a 9% increase vs. 2019 levels, which compares to the 13% increase we expect in Q4. Nonetheless, UAL will remain in a net loss position in Q1, before turning positive in Q2.”

TAKE A LOOK AT OUR EARNINGS CALENDAR FOR THE FULL RELEASES FOR THE JANUARY 19

TICKER COMPANY EPS FORECAST
AA Alcoa $2.5
ASML ASML Holding $4.3
CFG Citizens Financial Group $1.16
CMA Comerica $1.6
DFS Discover Financial Services $3.48
FAST Fastenal $0.36
FUL H.B. Fuller $1.06
KMI Kinder Morgan $0.27
MS Morgan Stanley $1.83
PACW PacWest Bancorp $1.06
PG Procter & Gamble $1.66
STT State Street $1.93
USB U.S. Bancorp $1.13
UAL United Airlines $-2.12
WTFC Wintrust Financial $1.56

 

Thursday (January 20)

IN THE SPOTLIGHT: NETFLIX

The California-based global internet entertainment service company NetFlix is expected to report its fourth-quarter earnings of $0.82 per share, which represents a year-over-year decline of over 30% from $1.19 per share seen in the same period a year ago.

However, the streaming video pioneer would post revenue growth of over 16% to $7.71 billion. It is worth noting that the company has beaten earnings per share (EPS) estimates just thrice in the last two years.

“We believe share performance is highly dependent on increasing global membership scale. Proven success in the US and initial international markets provides a roadmap to success in emerging markets, and scale should allow Netflix (NFLX) to leverage content investments and drive margins,” noted Benjamin Swinburne, equity analyst at Morgan Stanley.

“Higher global broadband penetration should increase the Netflix (NFLX) addressable market, driving member growth and providing further opportunity given NFLX’s global presence. Longer-term, we see the ability to drive ARPU growth, particularly given increased original programming traction.”

TAKE A LOOK AT OUR EARNINGS CALENDAR FOR THE FULL RELEASES FOR THE JANUARY 20

TICKER COMPANY EPS FORECAST
AAL American Airlines $-1.72
CSX CSX $0.42
FITB Fifth Third $0.91
ISRG Intuitive Surgical $1.01
KEY KeyCorp $0.56
MTB M&T Bank $3.24
NTRS Northern Trust $1.82
OZK Bank OZK $0.98
PPBI Pacific Premier Bancorp $0.85
PPG PPG Industries $1.2
RF Regions Financial $0.49
SASR Sandy Spring Bancorp $1.1
SIVB SVB Financial $6.29
TRV Travelers $3.77
UNP Union Pacific $2.66
WBS Webster Financial $1.11

 

Friday (January 21)

TICKER COMPANY EPS FORECAST
ALLY Ally Financial $2.0
FHB First Hawaiian $0.47
HBAN Huntington Bancshares $0.37
INFO IHS Markit $0.71
SLB Schlumberger $0.39

 

Preview: What to Expect From Goldman Sachs’ Earnings Next Week

The New York-based leading global investment bank Goldman Sachs is expected to report its fourth-quarter earnings of $11.89 per share, which represents a year-over-year decline of about 2% from $12.08 per share seen in the same period a year ago.

The world’s leading investment manager would see a decline in revenue of nearly 1% to $11.65 billion from a year ago. It is worth noting that in the last two years, Goldman Sachs has surpassed market consensus expectations for profit and revenue most of the time.

The bank will announce its earnings results before the market opens on Tuesday, January 18th. Goldman Sachs shares closed nearly 1% higher at $403.05 on Tuesday. The stock jumped over 45% in 2021.

Analyst Comments

“CEO Solomon is laser-focused on delivering on the ROE/ROTCE targets of 13%+ / 14%+ by 2023, as evidenced by the reduction in comp ratio. Goldman Sachs (GS) should be able to keep their total expense ratio under 60% even as revenues decline,” noted Betsy Graseck, equity analyst at Morgan Stanley.

GS has led peers in market share gains. We expect they can hold this share as they use their excess capital to lean into client flows, risk, middle-market banking and M&A capabilities. GS is also leaning into tech, which could drive market share gains higher. Examples span across the platform from trading to corporate treasury to consumer finance. These 3 trends give us more conviction that GS will be able to achieve its 13%+ / 14%+ ROE / ROTCE targets by 2023.”

Goldman Sachs Stock Price Forecast

Fourteen analysts who offered stock ratings for Goldman Sachs in the last three months forecast the average price in 12 months of $477.23 with a high forecast of $576.00 and a low forecast of $416.00.

The average price target represents an 18.40% change from the last price of $403.05. From those 14 analysts, nine rated “Buy”, five rated “Hold” while none rated “Sell”, according to Tipranks.

Morgan Stanley gave the base target price of $479 with a high of $594 under a bull scenario and $252 under the worst-case scenario. The firm gave an “Equal-weight” rating on the financial services company’s stock.

Several other analysts have also updated their stock outlook. BofA Global Research cut the price objective to $475 from $490. JPMorgan raised the target price to $465 from $460. UBS lifted the target price to $416 from $415. Evercore ISI upped the target price to $445 from $442.

Technical analysis also suggests it is good to buy as 100-day Moving Average and 100-200-day MACD Oscillator signals a buying opportunity.

Check out FX Empire’s earnings calendar

JPMorgan Clients Don’t Think Bitcoin to $100k is Feasible

Many bullish predictions have been made about Bitcoin this year. One of the most common is that the cryptocurrency will finally hit $100k this year.

JP Morgan Clients Don’t see Bitcoin at $100k

While many in the crypto community believe this, a new survey shows that only 5% of JPMorgan clients share that optimism.

The overall outlook for Bitcoin on Wall Street appears to be a little below the expectations of those in the crypto community. In the survey, more than 40% believe that it can go beyond $60,000. But the $100k is a ceiling it can’t touch before the end of the year.

A strategist at the Bank, Nikolaos Panigirtzoglou, also shares this opinion. According to him, “Our Bitcoin-position indicator based on Bitcoin futures looks oversold.” Nikolaos believes that Bitcoin’s fair value is between $35,000-$73,000.

The premier token, which got very close to $69,000 in November, has lost about 40% of its value since it reached that ATH. Currently, it is trading for around $42,000 after it briefly traded below $40k on Monday.

But the massive pullbacks haven’t stopped many who still believe that Bitcoin can make a home run to $100k.

Those who don’t see it reaching that have their fair point too. The possibility of interest rates hikes very soon is a concern as it’ll deprive the crypto market of much-needed liquidity. Already, the crypto market is having one of its worst starts to the year.

Crypto Enthusiasts Maintain That BTC can Reach $100k

But there are still others who think 100k is possible even with the pullbacks. Goldman Sachs believes this is possible if Bitcoin replaces gold as a store of value. 

Another intelligence report from Bloomberg states that adoption and scarcity could push Bitcoin to reach $100k.

Others in the crypto community also hold on to the same belief. Earlier this year, El Salvador’s president Nayib Bukele predicted that BTC would reach $100k in 2022.

Nexo founder, Antoni Trenchev, is even more optimistic as he sees this happening by mid-2022.

However, no one knows what will happen, given the current market trajectory. With the FUD of the Fed’s hawkish stance and market turbulence, BTC will have to pull some tricks to reach $100k in 2022.