Weekly Overview — April 1

This week’s price movements for Bitcoin (BTC), gold, the S&P 500, and this week’s wildcard stock Tesla and bonus stock IBM.

BTC

Bitcoin (BTC) has had a much better week than it did last week. After nearly trading below $51,000, March 26 saw BTC’s price climb its way back up to $55,000. It jumped up to $56,000 the next day, where it traded for the rest of the weekend.

On March 29, BTC shot back up to $58,000 before creeping back down to around $57,000, then the next day, when it again took a jump. The price nearly spiked to $60,000 on March 31, before selling pressure brought it back down to as low as $57,000. Bitcoin is currently struggling with resistance, around $59,000.

Source: TradingView

News of PayPal and Visa announcing greater payment integration in their networks is likely the cause of BTC’s bull run this week. Oanda Senior Market Analyst Edward Moya called the move “another massive cryptocurrency endorsement from Wall Street” and “further proof of mainstream acceptance.” Moya noted that bitcoin struggles with resistance at $60,000 but that recent developments “should be enough to keep the bullish trend going strong.”

GOLD

Gold has been on a rollercoaster ride over the past week. After channeling between $1,720 and $1,748 for most of last week, it largely continued to do that going into the weekend.

However, around midday on March 29, the price dived to $1,712, where it traded for the rest of the day. It then fared much worse the following day, tumbling below $1,680, where it opened on March 31.

Although, it immediately began seeing buying pressure and around midday jumped back up to $1,712. Throughout April 1, it continued trading up, and the price is currently around $1,728.

<em>Source: TradingView</em>

Source: TradingView

There are myriad reasons for gold’s wild swings this week. Ravindra Rao, VP-Head of Commodity Research at Kotak Securities, said:

“Weighing on gold price is US economic optimism, vaccine progress, higher yields, and lack of ETF buying.”

He also added:

“Supporting gold is the retreat of the US dollar index from recent highs, mixed US economic data, rising virus cases, and dovish central bank stance.”

SPX

After last week, which saw it tumble back down from new all-time highs, the S&P 500 (SPX) is back in form this week. By the end of March 25, the index fund already moved back up to nearly $3,920, from almost $3,850 earlier in the day.

March 26 saw it trading around $3,940 before a big jump to nearly $3,980 going into the weekend. Selling pressure opened the week, but by the end of March 29, SPX closed around $3,970. It traded down to $3,950 the next day before pushing its way to $3,990 on March 31. It is currently trading around a new all-time high of $4,000.

<em>Source: TradingView</em>

Source: TradingView

SPX was undoubtedly affected by US President Joe Biden announcing his $2.3 trillion infrastructure plan on March 31. Charalambos Pissouros, a senior market analyst at JFD Group, said:

“Although this is good news for the economy and it seems to be a supportive development for equities, it would be interesting to wait and see whether this will revive fears of an overheating economy.”

If this is the case, he says it could lift US Treasury yields higher and perhaps weigh on equities again.

TSLA

This week’s wildcard stock is Tesla (TSLA). Ever since CEO Elon Musk purchased $1.5 billion worth of bitcoin, its stock has been trading similarly. These past two weeks are no different. As bitcoin struggled last week, so did TSLA, toppling from nearly $700 on March 22 to almost $600 by the end of the week.

On March 29, it started performing a bit better before jumping up significantly the next two days, reaching $670 by the end of March 31. It opened around $690 on April 1 but is now trading around $675.

<em>Source: TradingView</em>

Source: TradingView

In relation to TSLA’s stellar midweek performance, Wedbush analyst Daniel Ives said he believes Tesla’s first-quarter deliveries will exceed analyst expectations for the period. This would “help restore some positive momentum back to Tesla and the EV sector,” Ives wrote in a note to clients. Ives further said:

“In China after a rocky start in the month of January, we believe Tesla was the benefit of share shifts vs. domestic players and thus puts the company now on a trajectory to handily exceed 800k units for the year.”

IBM

Meanwhile, after performing very well towards the end of last week, IBM struggled this week. On March 25, it rose from $130 to $133. It performed even better the next day, jumping up to $136.

However, on March 29, it immediately started seeing selling pressure, which the stock pushed back against until the next day. At that point, it dropped to $134, where it struggled before opening with a large red candle on March 31, down to $132. Although it worked its way back up throughout the day, it is now trading around $132.

<em>Source: TradingView</em>

Source: TradingView