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04.08.2022
Ethereum’s Most Important Update

ETH is a native token for the Ethereum blockchain and is one of the two most reliable digital assets in the market along with Bitcoin. Ethereum is the first platform that became a hub for thousands of blockchain apps and other digital solutions. The recovery of ETH prices to November 2021 peaks at $4,900 would bring investors 190% profit.

Second layer solutions (Layer2) were introduced to improve stability and effectiveness of the Ethereum blockchain. These are blockchain network add-ons that are added on top of the primary blockchain. The most popular add-ons are Arbitrum, Loopring, Immutable X, and Polygon that have recently partnered with Meta (Facebook owner). In other words, the Ethereum blockchain network has a much broader use than the native blockchain itself.

Ethereum developers promise to release a new Proof-of-Stake (PoS) consensus protocol in late 2022. This protocol will allow miners to stake tokens to a special deposit to mine blocks. Some networks within the Ethereum blockchain have moved to PoS protocol this summer, while others are expected to move to this protocol in the middle of September.  This move will allow for the increase of processing capacity of the network to almost 100,000 transactions a second from the existing 30 transactions and lower commissions. This would also allow for ETH to switch to the deflation model when coins are algorithmically burned, while some coins would be removed from circulation as they would be blocked by staking - more than 13 million ETH or 10% of overall coins in circulation are blocked by staking. The problem is that coins are blocked for a long period of time and cannot be sold or exchanged for fiat currency.

11.08.2022
Perspective Peers of Ethereum: Avalanche

Avalanche is ranked by Coinmarketcap at the 12th position by market cap with $7.8 billion, which is 4% less than Ethereum’s market cap. AVAX prices dropped by 82% of its peak values, allowing investors to buy it at early 2021 prices. Avalanche’s infrastructure consists of three logically isolated networks, each of these with their own processing, validators, and own set of rules.

This platform is often compared to the existing internet web infrastructure with core connection protocols like HTTP, surrounded by a huge number of networks to their apps. Avalanche allow for the creation of public and private systems as a blockchain or DAG (Directed Acyclic Graph) and for the use of different virtual machines for apps, including EVM engine (Ethereum Virtual Machine) that allows Enthereum network programs to be developed.

Avalanche includes C-chain to create smart contracts that are processed on an advanced EVM engine, P-Chain that coordinates validators that process transactions and also allows for the creation and management of new subnetworks, and X-Chain which is a directed acyclic graph regulating issuance and trade of cryptoassets. DAG systems record new transactions on top of the old ones, allowing for processing speed to be increased and for capacity substantially. It is quite different to other blockchains, where transactions are compiled in blocks in order to be processed.

The advantage of Avalanche is that it provides anyone with the opportunity to create his or her own isolated blockchain with its own set of parameters, including access to apps and the programming language with which it will work. Every subnetwork can process around 4,500 transactions per second compared to 14 processed by the Ethereum network.

15.09.2022
Safe Haven Assets for Long-Term Investments: Broadcom

Broadcom is an American semiconductor and infrastructure software development company. Soon it is expected to close a merger deal with VMware, a cloud computing and visualization company, that will open new cross-sales opportunities for Broadcom to boost its revenues. Broadcom stocks are now 25% off their peak values.

According to the Q3 FY 2022 financial report that ended July 31, consolidated revenues grew by 25% year-over-year to $8.46 billion, and EPS went up by 40% to $9.73 per share. The semiconductors segment, that added 32% year-over-year, was the primary driver for the company’s profit. The company’s free cash flows (FCF) topped $4.3 billion, allowing it to spend $1.7 billion on dividends and 1.5 billion on the shares repurchase program. The company is planning to continue spending at least 50% of FCF on dividends that added 43% every year on average since 2016. 

According to the Q4 FY 2022 forward guidance, the company is expecting its revenues to go up by 20% year-over-year to $8.9 billion and for EDITDA to go up by 25% to $5.6 billion. Broadcom has great experience in expanding its product portfolio by M&A operations, and apparently it will continue on this way. The company is also expected to benefit greatly from the $52.7 billion CHIPS bill in the United States.


16.06.2022
Not Every Tech Stocks are Equally Strong: SAP

SAP stocks have lost 30% since the beginning of 2022. The German tech company develops enterprise software and solutions to manage business operations. For example, one of its services can be used  to manage all business travel financial activities and related spending. In other words, it is quite a routine company with  a stable and strong cash flow. Once SAP software is installed on a corporate level it is hard to do without it as it is deeply integrated into the business core processes. Moreover, SAP is restructuring its business model around its subscription base and this will allow for cash flows to be even more predictable and balanced through the financial year. Such a model is in favourable to Wall Streel investors.

The war in Ukraine has a 300-million-euro negative effect on SAP business, and it is only a marginal 1% of the overall revenue base for the company, while its dominance in the ERP segment is secure. The revenues added 11% year-on-year to 7.08 euros in Q1 2022. The revenues grew by 6% in  Q4 2021.

The company has made some successful M&A deals, acquiring Qualtrics, a cloud-based subscription software platform, that delivered +48% revenue in Q1 2022. This company had a gross margin above 90% in 2021 while SAP’s gross margin was at 70% for the same year.

SAP management promised to triple its cloud-based business by 2025, and boost revenues to 22 billion euros, while operational profit is forecasted to grow by 40% from the current 8.4 billion euros. This is a very extensive growth for the company that has a high P/E ratio at 17. The company may not perform very high growth rates as its younger tech sector peers, but it may certainly recover to new all-time highs in the long-term perspective. However, the sector may require several quarters to recover, and the recovery would be headed by such reliable companies as SAP with a low risk profile.

26.04.2023
Diversification Inside Tech Sector: Taiwan Semiconductor

TMS is the most valuable semiconductor producer in the world. Its stock went down by 40% during the recent market correction, and rebounded slightly after a strong Q1 2023 earnings report. The company reported an operational margin at 45.5% as production of 5 nm and 7 nm chips is increasing. The company continues to generate profit despite decreasing demand for personal computers after surging during the pandemic in 2020-2021. Its financials are looking much stronger than its major peer Intel. In the worst-case scenario TSM’s operational margin is expected to decline to 40%, while Intel is expected to deliver a 39% operational margin with a negative net cash flow in Q1 2023. Taiwan Semiconductor is planning to spent between $32 billion to $36 billion on CAPEX this year, while Intel has cut CAPEX to $20 billion despite being 30% co-funded by the U.S. government.  On the negative side, the company is quite vulnerable to geopolitical risks as tensions between China and Taiwan are mounting. Although, it is hard to believe that Beijing will take the island by force, these threats could not be discounted. China is building its image as a global peacemaker while promoting its roadmap to establish peace between Russia and Ukraine, and the recent China-brokered agreement between Iran and Saudi Arabia. Economic ambitions of China are also a major hurdle for a military solution of the long-lasting conflict as the destruction of the chip production facilities of TSM will make such military operations pointless in the economic sense. In other words, TSM stocks may interest very optimistic investors that are seeking extra profit amid recovering demand for chips in the second half of` 2023.  

Rafael Quintana Martinez
Money Manager de alto rendimiento, con una sólida formación académica, profesional y de campo. Más de 9 años de experiencia especializada en el comercio de mercados financieros internacionales. La devoción, la fiabilidad, la responsabilidad y la ética impulsan mi vida. Actualmente me desempeño como Analista Senior para Metadoro. https://metadoro.com/es https://mx.investing.com/members/contributors/235587671/ https://es.tradingview.com/chart/EURUSD/rE9gVips/
Tron Is Ready for another Upside Round

Tron (TRX) is surging 5.0% to $0.2584, outperforming the broader crypto market as Bitcoin (BTC) rises 2.5% to $96,450. TRX is testing key resistance for the second time this month after an earlier rally to $0.4490, representing a staggering 118% gain. This rally was fueled by Tron founder Justin Sun's $30 million investment in a crypto project linked to U.S. President-elect Donald Trump, potentially signaling the resolution of Sun’s legal challenges.

TRX’s previous attempt to break the $0.3000 resistance ended in a pullback, but a renewed push could overcome this barrier. Sun’s flamboyant marketing strategies continue to make headlines. One notable example was his purchase of a taped banana artwork for $6.2 million, part of the Comedian exhibit, which he ate in a widely publicized stunt—an unconventional move that captured global attention.

1422
Wall Street Goals for 2025

The New York Stock Exchange (NYSE) and Nasdaq, which are the world's most important trading platforms, end the year at even higher levels than we expected. Lower borrowing costs by leading central banks, as well as a particularly fruitful Q3 earnings season, Black Friday and Cyber Monday sales results contributed much to the S&P 500 broad market indicator's climbing to record tops above 6,000, with the Nasdaq 100 index touching the area around 22,000 for the first time ever, compared to nearly 4,770 and 16,667, respectively, at the starting line of 2024. This means the annual performance is nearing 27% for the broad market barometer and 32% for the tech-heavy measure on average. Even if we may halve our potential 2025 percentage growth bets, the output from this moderated inertial scenario would give us 6,850 for the S&P 500 and 25,500 for the Nasdaq index, even though a bolder extrapolation is quite possible.

As an example, the road map made by Capital Economics before Christmas supposed the S&P 500 may finish 2025 at 7,000. This forecast came out despite the researchers' belief that the Federal Reserve's policy could be "a bit less accommodative” than they had previously projected, while mostly attributing the recent one-off slide in the S&P on the next day after the latest meeting of the U.S. financial regulator to a correlating sell-off in public bonds. It appears that the market crowd agrees with this statement, since the bulls have recovered so quickly. Monetary drivers are probably not decisive in this context. What could be more important is the extent of sensitivity of the American economy to trade battles with China and other rival economies under the upcoming Republican administration. Trump 2.0 is a "recipe for volatility" in 2025, says Piper Sandler, as its analysts are feeling the current situation may mirror the early 1980s when Ronald Reagan inherited great and sticky inflationary pressures accompanied by policy dysfunction and surging federal spending. The investment bank marked the risks of recent rate cuts "gone too far, too fast" while tariffs may push prices higher.

Goldman Sachs believes the Trump administration will implement targeted tariffs on imported automobiles and certain imports from China, as well as a 15% corporate tax rate for domestic manufacturers. They expect that the cumulative impact of these policy changes on corporate profits may roughly offset one another on net, so that Goldman projects the S&P 500 index to rise to 6,500 by the end of 2025. Morgan Stanley also stressed its base case for the S&P 500 price target at 6,500 on "earnings growth broadening".

The uncertainty surrounding fiscal policy under Trump is added to chances for a potentially negative impact. And so, the first 100 days of Trump's presidency will reveal a seriousness of his purpose to drive to much lower corporate taxes and a more effective government. However, we note that even the difficult progress of legislative initiatives during Trump’s first term on a stage of a divided Congress did not prevent the stock market from further rallying in 2017-2019, and now the Republicans have a clear majority in both the House and the Senate. As the first post-election phase of the so-called Trump trade has gone, its next phase when a revolutionary Republican agenda is going to be implemented step-by-step in practice will be a good stress test for markets. Yet, a protective mood may be united with residual enthusiasm to provide the bullish dynamics at least in the course of the first half of 2025 when about two-thirds of the way to our annual targets could be passed already. A corporate agenda of strong forecasts' transformation into reality can also be helpful on this stage. But the second half of the year may become more data dependent to create volatility in case of weaker-than-expected policy results.

We should not forget that the large tech corporations with American roots are not so closely related to revenues from the United States, selling a lion's share of their products and services to Asia and countries of the “Global South”. The top techs, led by NVIDIA, Apple, Microsoft, Meta, Google, Amazon, Broadcom etc., could play a quasi safe-haven role, especially as new China's stimulus hopes for a record-breaking 3 trillion Yuan (more than $400 billion) in special treasury bonds for 2025 are going to improve the global market sentiment, starting from giant beneficiaries of this policy. The economic growth in China is a very important factor for the country's domestic consumption, including products by transnational companies and local supply chains. Whether the growth pace in China will be sustainable or not will determine the prospect of achieving our target levels for the Wall Street indexes and its flagships in the second part of the year.

1232
B
Bitcoin Is Changing Glass Slippers for Shoes for Regular Partying

The world's key decentralized digital currency has long ceased to be a Cinderella who wanted to be able to dance at her first ball in top markets. Yet, the U.S. President-elect Donald Trump and a circle of his close associates including the charismatic Elon Musk suddenly became shining representatives of some fairy godmother for Bitcoin. Crypto fans were so imbued with Trump's plans iterated and reiterated on the point of Bitcoin's extensive use as a full-fledged tool to form the American reserves in a glimmer of hope for paying off public debts by Bitcoins in the future, that BTCUSD price explosion above $100,000 was the shortest walk it ever had. Thus, Bitcoin openly crossed the line to gain access into high society forever, and no missing shoe in the course of a temporary retracement would turn its magic carriage into a simple pumpkin, with its "noble birth" being confirmed for the rest of the decade at least.

A favourable regulatory framework and increasing demand for the purposes of accumulating income, saving money and alternative cross-border payment against a whole heap of restrictions and losing credibility by fiat currencies led by the Greenback are compelling even heavy traditional investors to join reluctantly to the speculative fever club resulting in more or less aggressive buying any local dips in Bitcoin. Violent pitching of a Bitcoin boat took place on Thursday when it attempted to approach a $100,000 milestone once again. A broader altcoin market became very unstable at that moment as well. Well, it's just O.K. if the former Cinderella was certainly tired from dancing too long on the upper deck to take breath and went down for a while.

It may take some time to change the glass slippers for normal shoes to go on with a more regular party. However, we all saw how quick and sharp Bitcoin was when bouncing twice from the area around $92,500 to above $99,500 and nearly touching $100,000 again. This circus trick of extremely high activity first happened on December 20 and then was repeated on December 24, and so this sliding down and recovering back manoeuvres became just a matter of a few days. For me, this means that daring jumps above $105,000 could not be ruled out in January, of course, but the time factor is slowing down for the nearest weeks, thanks to the Federal Reserve's pause in its cutting rates cycle, which helps to strengthen market positioning in U.S. Dollars. More growth in both gold and crypto assets could be subdued, with a respite being used by market enthusiasts for a more solid bottoming to set roots for buying more Bitcoins for longer.

Technically, I believe that any decline to a lower range between $85,000 to $90,000, if this move ever happens, would immediately spark up investing interest by a much wider circle of both corporates and small traders. As a result a plunge to $80,000 or below is surely not my baseline scenario, and we may totally forget about quotes like $50,000 or $60,000 in 2025, like if this was before the founding of our current civilization. Another fundamentals behind much higher pricing of alternative means of payment, led by crypto, are implausible monetary road maps by major central banks, which could be called shaky at best, a long history of too weak financial discipline with printing too much money by leading countries, in contrast with a relatively pure financial planning, as blockchain technology is transparent limiting minting better than the governments with catastrophically raising for debt ceiling continuously. As my lowest estimate for a possible Bitcoin retracement is around $80,000, then personally my expectations for Bitcoin rally extensions are ranging from $120,000 to even $150,000 in 2025. It's just going to take a little time to get used to new realities at the beginning of the new year. Shortly thereafter, it may go forward again.

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Rafael Quintana Martinez
Money Manager de alto rendimiento, con una sólida formación académica, profesional y de campo. Más de 9 años de experiencia especializada en el comercio de mercados financieros internacionales. La devoción, la fiabilidad, la responsabilidad y la ética impulsan mi vida. Actualmente me desempeño como Analista Senior para Metadoro. https://metadoro.com/es https://mx.investing.com/members/contributors/235587671/ https://es.tradingview.com/chart/EURUSD/rE9gVips/
Monero Could Jump to $225.00

Monero (XMR) has gained 1.4% to $190.70, outperforming the broader crypto market, where Bitcoin (BTC) is up by just 0.2% to $95,441. Earlier on Thursday, Bitcoin touched $100,000 but dropped 4.7%, while Monero retreated only 1.0%, showcasing resilience that may suggest the coin is undervalued.

In November and December, altcoins generally surged over 60%, yet Monero has lagged with a 48.0% increase, peaking at $232.40 on December 16. The altcoin has repeatedly attempted to breach the $225.00 resistance but has consistently pulled back to strong support at $175.00. This combination of perceived undervaluation and robust support makes Monero more resistant to negative market shocks.

Given this setup, another attempt to test the $225.00 resistance level appears plausible, provided broader market conditions remain supportive.

2092
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