Tesla is on a roll. Just this morning, Tesla stock rallied, pushing its market cap to over $140 billion.
At this valuation, Elon Musk’s automobile company is worth more than the combined valuations of Ford, GM, Daimler, and Chrysler.
As Tesla roar, its price rally can be compared to Bitcoin’s. In Q4 2017, BTC sharply rose and plotting the same on Tesla’s technical chart reveals some glaring similarities.
Tesla Plotting a Parabola
With the stock market jittery because of coronavirus fears and reiterated beliefs that it is being pumped and propped by central banks and would at no time crumble, the success of Tesla reveals that every market has its moment of brilliance.
At $161 billion, Tesla now has a higher market cap than GM, Ford, Fiat Chrysler, and Daimler … combined. $TSLA pic.twitter.com/yoeMpm5UaN
— Charlie Bilello (@charliebilello) February 4, 2020
Parabolic rallies are not specific to a market but depending on several conditions, fear-of-missing out, and supportive investor sentiment, an investment stands to benefit from a surge in capital injection, pushing its valuation higher.
In the case of Tesla, its share price is up 80% this year and fueled partly by analysts who continue to reprice the stock’s share price so as not to miss the rally, and a pessimist who are covering their shorts as they believe it is over-valued.
Interestingly, one analyst, Irwin—in an interview with CNBC said, Tesla stock interest is from high net-worth and institutional grade investors. He added that its momentum is also huge.
“I think this is largely the fear of missing out. The number of large hedge funds calling in, the number of institutional investors calling in, saying ‘where does it stop? What’s the catalyst? The momentum is huge.”
Bitcoin Halving Could Pump Its Market Cap, Tesla May Cool Off
Compared, the demand for Bitcoin is also high. The community expects better prices in days ahead. As an established network with more users than any other blockchain, BTC has true utility.
The native currency serves as a store of value, a medium of exchange, and a reliable entry that is a base currency in most cryptocurrency exchanges.
As a public chain, its development—or proposals are clear and deliberate, unlike the currency technical uncertainty around ETH, meaning the confidence of the future spurs BTC demand. At spot rates, prices are stable and its market cap stands at $166 billion, $26 more than Tesla.
This madness happened in traditional stocks.
This is not even #crypto.
Don't get shaken out of your #BTC. Don't sell call options without being hedged. #Bitcoin will make such moves look cute… just as it did before. https://t.co/HfAKvAdEEX
— ?? Trading cryptocurrency derivatives ????? (@CryptoDerivativ) February 4, 2020
With Bitcoin halving ahead and the chances of a huge correction as Tesla overheats, the market cap of these two may diverge going forward.
