weekly recap intellinvestors april 19 to april 23 2021

Weekly Recap: Canada Tapering Stimulus, More Dollar Weakness, Bitcoin Meltdown

The biggest stories of the April 19 – 23 trading week include the dollar’s third week of decline, Canada scaling back its stimulus, rising COVID-19 infections in India, Bitcoin dropping 10%, and Biden’s tax plan.

Bearish sentiment for the U.S. dollar continued for the third week amid a spike in global COVID-19 cases worldwide. The greenback dropped to 90.83 in Friday's trading and is expected to remain weak as the Fed is likely to maintain its dovish stance in the upcoming meeting on Wednesday.

Much like the Fed, the ECB also kept its crisis-fighting tool unchanged on Thursday while confirming that it will ramp up purchases but still within the planned 1.85 trillion euros ($2.2 trillion). EURUSD capped the week off with a 0.12% gain because of this.

Canada, so far, is the only G7 country to signal an exit to its bond-buying program and hinted at a possible rate hike. In turn, the loonie soared against the dollar on the announcement, with the USDCAD dropping 0.26% the entire week.

Stocks remained relatively flat but weren't fazed at all by Joe Biden's proposed capital gains tax that could be as high as 43.4%. A temporary roadblock on further gains may be the rising cases, particularly in India, that hit a peak of 349,691 on Saturday. 

The S&P500 had a 0.14% uptick week over week and the MSCI Emerging Markets with 1.09%, owing to the still prevalent risk-taking mood in the market, as marked by CNN's Fear and Greed Index.

With cryptos, Bitcoin (BTC) shed off more than 10% and dipped to as low as 49,241 on Sunday. Crypto investors are seen to be particularly sensitive to the proposed capital gains tax, as the top five digital assets tracked by Capital.com fell 8.6% from last week.

Chart of the week:

In the previous week's chart, the EURUSD trade proved to be a good long trade entry as the breakout in 1.1981 is at present 115 pips higher. But the more compelling trade as of writing is Bitcoin's bounce at its recent support level after it managed to stay above the 50,000 mark.

bitcoin btc april 26 2021

Here's a recap of all the other winners and losers in last week's trading:

  • U.S. dollar -0.86% 
  • BTC -10.51%
  • EURUSD +0.96%
  • GOLD +0.07%
  • AUDUSD +0.14%
  • USDJPY -0.80%
  • GBPUSD +0.25%
  • S&P 500 +0.14%
  • NIKKEI -2.23%
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