Bitcoin Flash Crashes -15%

TAKEAWAYS

•    Bitcoin slides 15% in weekend flash crash before trimming losses
•    Ether, other altcoins fall as much as 20%
•    Gold rallies to 7-week high, completes double bottom pattern
•    EUR/USD barely changed on Friday under 1.20
•    GBP/USD makes big bullish outside bar, closes over 1.38
•    S&P 500 closes 4th week higher in a row
•    German DAX reaches fresh record high
•    China GDP grew 18.3% y/y in Q1
•    Worldwide death toll from covid-19 now over 3 million
•    WEEK AHEAD: Inflation data, ECB, BoC Meetings, More Q1 Earnings

BEST CHART
Gold – 4-hour Candlesticks
 

Source: GKFX Prime / Metatrader 4 

Gold has completed a double bottom price pattern. Using the height of the pattern to find an upside price objective, the pattern implies a move up to $1830 per oz.

GURU WISDOM

“Letting losses run is the most serious mistake made by most investors.” – William O’Neil

MARKETS

*Daily closing price
↘ EUR/USD    1.1977        (-0.05%)
↘ GBP/USD    1.3820        (-0.07%)
↗ USD/JPY    108.77        (+0.03%)
↗ S&P 500    4185.47     (+0.36%)
↗ Gold        1776.90    (+0.57%)
↘ Oil (Brent)    66.71        (-0.34%)
↘ Bitcoin    56,003        (-6.62%)

NEWS

A shock 15% decline in the Bitcoin price over the weekend had no direct cause, though there has been some rumours that Janet Yellen’s Treasury could introduce a money laundering crackdown around cryptocurrencies. Perhaps a more plausible explanation is some post-Coinbase IPO blues. With a lot of crypto-money chasing the IPO, it may have left a lack of buyers in actual crypto-markets. The Bitcoin crash was first, followed by other altcoins with steeper declines.

The price of gold has continued its run of good form (see chart). Last week was the best in 4 months for the yellow metal. The downturn in the US dollar and Treasury yields, especially in the face of such strong US retail sales and jobless claims data released on Friday, is the clearest cause of gold’s new lease of life. However, talk of Chinese authorities allowing banks to import large amounts of gold into the country was another possible driver.

In forex markets the British pound was top gainer on Friday with GBP/USD putting in a huge outside day on bar charts (engulfing candle on candle charts). The turnaround from steep losses to closing above 1.38 suggests bulls took control of the market.

The Dow Jones and S&P 500 continued their winning stetch last week, now higher for 4 weeks in a row. Germany’s DAX also hit a record high. Chinese stock indices on the mainland and Hong Kong saw strong gains after China GDP was reported to have grown a massive 18.3% year-over-year in the first quarter. 

DAY AHEAD 

*Times in GMT
23:50 – Japan Merchandise Trade Balance Total(Mar) [¥490 B Exp vs. ¥215.9 B Prev]
04:30 – Japan Industrial Production (MoM)(Feb) [-2.1 % Exp vs. -2.1 % Prev]

SOURCES

https://www.gkfxprime.com/trading-tools/economic-calendar
https://www.forexlive.com/cryptocurrency/!/black-sunday-for-crypto-as-bitcoin-and-others-plunge-20210418
https://www.cnbc.com/2021/04/15/stock-market-futures-open-to-close-news.html
https://www.investing.com/analysis/week-ahead-inflation-fears-earnings-results-could-collide-adding-volatility-200573681