Bitcoin has been holding up above the key $100K mark as it consolidates after a run to record high. Can it regain altitude?
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Monday’s TLDR
- BTC 4% from all-time highs
- GME, ORCL set for earnings
- Post-IPO momentum for Circle
Weekly Outlook
Markets fired higher after Friday’s stronger-than-expected jobs report, with the S&P 500 just 2.5% from its all-time high. Speaking of highs, Bitcoin is within 4% of its record highs, as it works on its fourth straight daily gain (we’ll take a closer look at BTC in a minute).
As for this week, it’s on the mellow side. We’ll get earnings from J.M. Smucker tomorrow morning, while GameStop and GitLab will report tomorrow afternoon.
On Wednesday, Chewy and Oracle will report earnings, while Adobe will report earnings on Thursday afternoon.
We’re hitting the “earnings lull” period where we’ll have a few stragglers reporting each week, but we won’t get into the heavy earnings weeks again until July when the big banks kick things off again. At that time, we’ll be much more attuned to the tariff impact (as Q1 largely sidestepped those issues).
But until then, the focus will remain on macro items — like last Friday’s jobs report or Wednesday’s CPI report — as well as ongoing trade discussions, like today’s meeting between the US and China.
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The Setup — Bitcoin
Bitcoin raced back to record highs before the S&P 500 or Nasdaq could, helping to lead the risk-on charge. Even more recently amid little bursts of volatility, BTC has continued to hold up over $100,000.
The price action has been very encouraging, whether investors are trading actual Bitcoin, opting for the ETFs, like IBIT — which also has options trading available — or stocks that have Bitcoin or crypto exposure (like Riot Platforms, MicroStrategy, the brokers who deal in the space, new-issue Circle, and others).
If Bitcoin is able to string together enough momentum to get back to record highs, some investors are wondering if it will give a boost to Ethereum, Dogecoin, Litecoin, Cardano, and others.
Right now, BTC is having a very good reaction off its 50-day moving average (in red) as it tries to push through a key resistance area. If it can clear the $110,000 level, new highs could be on the horizon.
If not and momentum fizzles out, bulls should look to see if BTC can remain above the key $100,000 level, just as it did last week.
Options and ETFs
For investors who can’t trade or aren’t comfortable trading cryptocurrencies outright, they can consider ETFs for BTC and ETH. On the BTC front, IBIT remains the largest ETF by assets, while also supporting options trading.
Bulls can utilize calls or call spreads to speculate on upside, while bears can use puts or puts spread to speculate on downside. In either case, investors may consider using adequate time until expiration.
For those looking to learn more about options, consider visiting the eToro Academy.
What Wall Street Is Watching
Rocket Labs stock is lifting off this morning amid speculation that government contracts could shift away from SpaceX after the very public spat between President Trump and Tesla and SpaceX CEO Elon Musk. Check out the charts for RKLB.
Shares of Circle have been exploding higher since going public last week. On Friday alone, the stock climbed almost 30%, while in pre-market trading, shares are higher by almost 20%. There’s no telling how long the momentum will last, but the stock has been strong in the short time it’s been publicly traded.
Warner Bros. Discovery stock is in focus this morning as investors cheer on a breakup of its business. The company will split into two publicly traded companies, with one focusing on Streaming & Studios, and the other on TV Networks. Here’s what analysts think of WBD stock right now.
Disclaimer:
Please note that due to market volatility, some of the prices may have already been reached and scenarios played out.