Musk backs dogecoin, Apple car, euro slide continues, BOE, oil rises, gold falls on strong dollar

US stocks are rising again as the reflation trade continues with the yield curve continuing to steepen.  There is no main driver for the markets today.  Treasury yields are not going anywhere, earnings from Merck, Unilever, and Yum are nothing to get excited over, and the retail-driven trading frenzy continues to ease.

Dogecoin surges higher after Musk’s tweet

Elon Musk’s Twitter break is over and clearly, his love for Dogecoin is not abating.  Musk delivered a wrath of tweets on SpaceX and endorsements for Dogecoin.  Musk took down his Bitcoin bio and tweeted, “Dogecoin is the people’s crypto” and “No highs, no lows, only Doge”.

Dogecoin surged higher and sparked a broad rally across all the major cryptocurrencies.  Bitcoin initially tumbled after Musk removed Bitcoin from his bio, but still seems poised for another run towards the $40,000 level.

An Apple car?

Apple appears ready to take another stab at making a car.  A partnership between the tech giant and Hyundai-Kia is nearing, but that doesn’t mean another auto maker can’t join the mix.  An Apple-branded autonomous electric vehicle with Hyundai-Kia could go into production in 2024.

Apple’s automotive efforts started in 2014 and were abandoned in 2016.  Taking on Tesla will be a difficult task and in order to be successful Apple will need to have a better battery design.

Since the Georgia Senate runoff races that gave President Biden his ‘blue wave’ in January, the dollar has been on a tear against the euro.  At the end of last year, net dollar selling was approaching its highest levels in a decade, so an unwind of this trade was needed.  After nearly touching 1.2350 in January, the euro has fallen to below the 1.20 level.  The macroeconomic outlook for the eurozone took a hit on a disappointing vaccine rollout and that downbeat assessment could still trigger some further pain for the euro.

Eventually, the dollar will lose its crown and the unprecedented fiscal and monetary efforts will weigh on the currency.  The EUR/USD currency pair could easily test 1.19 this week, but the bearish slide should exhaust itself on a move towards the 1.17 region.


The British pound surged after the BOE eased concerns that they were closer to considering negative interest rates.  Hope for the best and prepare for the worst is what the BOE is telling the banks.  Preparing for negative rates was an effective next step.  The Bank is considering a potential tiered system.  The GDP growth forecast was lowered from 7.5% to 5.0%.

The UK economy is turning a corner and their vaccine rollout success should point to a brighter second half of the year.


Crude continues to rise on strong momentum from falling stockpiles and COVID vaccine progress.  It’s been quiet on the energy front so far, which is allowing energy traders to focus on the improving supply and demand fundamentals.

Brent crude has a price barrier at the USD60 level, so slowly put a pause in the current rally.


Gold is dropping as the dollar rebound continues and demand for safe-havens ebbs.  Gold is consolidating but if it breaks below USD1,800, it could find itself in the danger zone.  The unwinding of bearish dollar bets is almost over, but it could still have one last push.

The longer-term outlook is still bullish for gold.  A quick passing of President Biden’s USD1.9 trillion stimulus relief plan should provide some underlying support for gold.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Ed Moya

Ed Moya

Senior Market Analyst, The Americas at OANDA
With more than 20 years’ trading experience, Ed Moya is a senior market analyst with OANDA, producing up-to-the-minute intermarket analysis, coverage of geopolitical events, central bank policies and market reaction to corporate news. His particular expertise lies across a wide range of asset classes including FX, commodities, fixed income, stocks and cryptocurrencies. Over the course of his career, Ed has worked with some of the leading forex brokerages, research teams and news departments on Wall Street including Global Forex Trading, FX Solutions and Trading Advantage. Most recently he worked with, where he provided market analysis on economic data and corporate news. Based in New York, Ed is a regular guest on several major financial television networks including CNBC, Bloomberg TV, Yahoo! Finance Live, Fox Business and Sky TV. His views are trusted by the world’s most renowned global newswires including Reuters, Bloomberg and the Associated Press, and he is regularly quoted in leading publications such as MSN, MarketWatch, Forbes, Breitbart, The New York Times and The Wall Street Journal. Ed holds a BA in Economics from Rutgers University.
Ed Moya