Gold, Stocks, and Bitcoin: Weekly Overview — April 22

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In Brief
  • Bitcoin has had an exceptional week, reaching a new all-time high just under $65,000.

  • Gold has larger followed through with last week’s upwards swing.

  • Roblox is back where it started, while Square acted a bit like bitcoin, and JPMorgan has its best spring ever.

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This week’s price movements for bitcoin (BTC), gold, as well as stocks Roblox, Square and JPMorgan.



BTC

Bitcoin (BTC) took a beating, this week. After achieving an all-time high of $64,935 on April 14, BTC’s price stayed above $60,000 for the rest of the week. However, the price took a dive on April 18, initially dropping to $54,520, before reaching even lower at $53,700. On April 19, it almost managed to reach $58,000, but has been steadily trading downwards ever since. At press time, it is trading at around $54,500.

Source: TradingView

If BTC isn’t able to break back above $60,000 soon, momentum signals will collapse, according to JPMorgan Strategists led Managing Director Nikolaos Panigirtzoglou. “Over the past few days bitcoin futures markets experienced a steep liquidation in a similar fashion to the middle of last February, middle of last January, or the end of last November,” the strategists said. “Momentum signals will naturally decay from here for several months, given their still elevated level,” he added.



Gold

Last week, gold’s price was on a bit of a roller coaster, but finished with an upwards swing. It has largely continued with that upwards momentum, this week. After reaching nearly $1,770 on April 15, the next day it went even further reaching a high of $1,783.

On April 19, it pushed even higher, to $1,789, before falling to roughly $1,770, where it traded through to the next day. Then, on April 20, gold started seeing more buying pressure again. This culminated with a rise up to $1,797, before coming back down to around $1,780, where it was trading, at the time of writing.

Source:TradingView

Gold futures settled higher, getting a boost from a retreat in U.S. Treasury yields. The ten-year Treasury note’s yield was down at around 1.56%. A fall in government debt yields apparently can strengthen demand for precious metals. An analyst at brokerage firm Zaner wrote:

“The gold trade has not been overly focused on physical demand, with the market instead alternating between interest rates, currency and reflation issues. In the near term, gold is likely to be vulnerable to the Indian demand threat and to rising U.S. rates, but cushioned by weakness in the dollar and perhaps to a lesser degree by reflation psychology.”

RBLX

Similar to last week’s wildcard Coinbase, Roblox is also a new public offering. Roblox is an online game platform initially released in 2006. Its usership grew steadily until recently, when the COVID-19 pandemic saw it skyrocket, which led to its public listing on March 10.

Initially priced around $70, the first few days saw it push up to nearly $80. Selling pressure then arrived which saw the price fall to an all-time low of $60. It slowly moved back up over the next two weeks, reaching an all-time high (ATH) of $83, on April 13. It has since come back down and is again trading around $70, at press time.

Source:TradingView

Bank of America analyst Ryan Gee said Roblox “gives unique exposure to a large, growing mobile [total addressable market] with less-relative capital risk than traditional content creators.”

Gee described Roblox as combining the social media aspects of Snap Inc. and TikTok with the gaming aspects of Epic Games’ Fortnite, Activision Blizzard Inc.’s Call of Duty, and Take-Two Interactive Software Inc.’s GTA Online. Although the gaming platform utilizes digital currency, it does not utilize blockchain and so is not cryptocurrency.

SQ

Square Inc. is a payment service run by Twitter CEO Jack Dorsey. The company initially purchased $50 million in bitcoin, last October, before buying another $170 million in February. Similarly to other companies that have heavily invested in bitcoin, its stock has started trading like it.

On an upwards trajectory since the beginning of April, SQ achieved a recent high of $278, on April 14, the same day BTC reached its latest all-time high. Since then, it has also corrected a bit, and is now trading around $255.

Source:TradingView

According to RBC Capital analyst Daniel Perlman, its more recent bitcoin purchase reflects the “management’s commitment to bitcoin as the currency of the internet.” Square disclosed that three million users of its Cash App traded bitcoin in 2020.

They added an additional one million who did so in January 2021. Cash App users can buy, hold and sell bitcoin. Square’s adjusted revenue from bitcoin are sales to app users, while subtracting the cost of purchasing the digital currency. Square’s bitcoin business has gross profit margins of around 2%, according to the analysts.

JPM

JPMorgan has had a rather good spring so far. Trading around $130 on Feb. 1, the next day JPM gapped up to $132. It continued that upwards trajectory for the next two weeks, culminating just under $155 on Feb. 25. The next two weeks after that, it channeled for a bit but made its way back up to $157.

March 18 saw the stock price gap up to its all-time high of $161, before falling back down into the $150, where it has been again channeling ever since. JPM is currently trading just below $150.

Source:TradingView

Disclaimer

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Nick is a data scientist who teaches economics and communication in Budapest, Hungary, where he received a BA in Political Science and Economics and an MSc in Business Analytics from CEU. He has been writing about cryptocurrency and blockchain technology since 2018, and is intrigued by its potential economic and political usage. He can best be described as an optimistic center-left skeptic.

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