GBP/USD Price Analysis – May 05, 2025
Daily Price Outlook
During the European trading session, the GBP/USD currency pair has remained strong as it extended its upward momentum, trading around 1.3285.
However, the pair’s rally has been driven by a mixture of internal UK factors and broader global uncertainties, particularly the outlook for the Bank of England (BoE) and Federal Reserve’s (Fed) upcoming decisions, along with persistent trade tensions between the US and China.
GBP/USD Supported by BoE Rate Cut Expectations and Economic Factors
However, the major driver behind the pound’s strength is the growing anticipation of a rate cut by the BoE. Analysts at Bank of America (BofA) have forecasted a 25-basis-point reduction in the UK’s borrowing rates, bringing them to 4.25%.
This rate cut is expected to be backed by a majority vote of 8-1, with one MPC member, Swati Dhingra, likely pushing for a more aggressive cut of 50 basis points.
The decision comes as the UK faces potential economic risks, exacerbated by ongoing trade uncertainties and improving domestic inflation conditions.
Moreover, BofA expects the BoE to cut rates further in the coming months, reflecting a cautious stance on the UK’s economic recovery amid trade disruptions.
This dovish outlook from the BoE continues to provide support for the GBP, as investors price in a more accommodative monetary policy in the near term.
USD Faces Pressure Ahead of Fed's Decision Amid Trade and Inflation Concerns
On the US side, the US dollar is under pressure ahead of the Federal Reserve’s monetary policy announcement. Markets are almost fully pricing in a steady interest rate, keeping rates between 4.25% and 4.50%.
Moving on, the focus now shifts to the Fed's future policy guidance, especially considering the strong April Nonfarm Payrolls data, which showed better-than-expected job growth despite ongoing tariff policies.
US President Trump’s recent comments on lowering tariffs have added complexity to the Fed’s decision-making process.
While Trump has consistently urged the Fed to cut rates, arguing that the US economy shows signs of improvement, particularly with lower energy costs and strong employment figures, the Fed has maintained that interest rate cuts will only be considered if there are clear signs of economic weakness.
Moreover, concerns over rising inflationary pressures, fueled by elevated consumer price expectations and business owners hiking prices due to higher import duties, may limit the Fed’s flexibility in pursuing rate cuts.
This uncertainty surrounding US monetary policy has contributed to the USD's struggle, benefiting the GBP/USD pair.
GBP/USD – Technical Analysis
GBP/USD is navigating a tight descending channel, currently trading below the 50-SMA at $1.33314. Price attempted a recovery above $1.33082 but failed to sustain momentum, producing a rejection candle that hints at renewed bearish pressure.
The structure continues to reflect a lower-high and lower-low sequence—a classic downtrend in motion.
Candlestick analysis reveals an indecisive zone near the $1.33082 mark, with a spinning top followed by a bearish engulfing pattern, signaling hesitation and exhaustion from bulls.
Meanwhile, the Relative Strength Index (RSI) hovers around 45.54, below its average of 44.12, offering little indication of oversold relief or bullish divergence.
A break below $1.33082 reaffirms downside momentum, exposing immediate support at $1.32589 and secondary support at $1.32336.
On the flip side, if bulls breach $1.33364 with strong follow-through, the pair could challenge $1.33801.
However, the bearish channel and 50-SMA crossover overhead suggest that upside attempts are likely to face resistance.
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- GOLD Price Analysis – May 05, 2025
GOLD Price Analysis – May 05, 2025
Daily Price Outlook
Gold prices extended their winning streak on Monday, surging more than 2% to reach $3,310 as investors flocked to safe-haven assets amid rising geopolitical tensions and growing concerns over the Federal Reserve's monetary policy.
However, the sharp rally in Gold (XAU/USD) came after a weekend of heightened risks, including a Houthi attack on Ben Gurion Airport and Israel's plans for a large-scale ground offensive in Gaza.
These developments have intensified market uncertainty, driving traders to seek the stability of gold as a hedge against global instability and potential shifts in U.S. interest rate policies.
Therefore, the news of US President Donald Trump hinting at military action to take control of Greenland further added to the sense of global instability, driving demand for gold as a secure investment.
Gold's Safe-Haven Demand Rises Amid Geopolitical Tensions in the Middle East
On the geopolitical front, the safe-haven demand for gold has been growing as tensions rise. The Houthi attack and the expected Israeli retaliation have raised concerns about instability in the region, pushing investors to seek the stability of gold.
However, the conflicts in the Middle East continue to create uncertainty, traders are turning to gold, which has long been considered a reliable store of value during times of geopolitical turmoil. This increasing demand for gold highlights its role as a safe-haven asset when global risks intensify.
Gold's Appeal Boosted by Fed Rate Cut Speculations and Geopolitical Tensions
In addition to geopolitical risks, the ongoing speculations surrounding the Federal Reserve’s upcoming interest rate decision are also playing a major role in pushing gold prices higher. However, the market is gearing up for the Fed's meeting on May 7, with traders anxious about potential rate cuts.
President Trump’s continued criticism of the Fed and its Chairman Jerome Powell, coupled with his calls for rate cuts, has contributed to heightened expectations. However, the CME FedWatch tool indicates a 94.6% probability that the Fed will keep rates unchanged in the immediate term.
Despite signs of a slowdown in the US economy, including recent weaker Nonfarm Payrolls data and slower manufacturing and services growth, the economy is not in freefall.
This slower pace of growth gives the Fed space to keep interest rates steady, which supports gold's appeal.
Hence, the Fed’s careful approach to rate cuts also signals that higher rates could stick around for longer, making gold more attractive as an alternative investment.
Gold's Bullish Outlook Amid Fed's Rate Cut Speculations and Geopolitical Risks
Looking forward, traders are keeping a close eye on both the geopolitical situation and the Fed's monetary policy.
The likelihood of a rate cut by the Federal Reserve in its May meeting is low at just 5.2%, but June has a much higher chance at 46.6%.
These expectations, along with ongoing geopolitical risks, suggest that gold could continue to rise in the short term.
Despite many Asian markets and the UK being closed for a public holiday, gold is still benefiting from strong buying interest.
Apart from this, the gold mining sector is seeing significant changes, with Gold Road Resources agreeing to a $3.7 billion takeover by Gold Fields, pointing to more industry consolidation.
Therefore, the strong buying interest in gold, coupled with industry consolidation like Gold Road's $3.7 billion takeover, signals confidence in the sector, potentially driving gold prices higher due to increased demand.
GOLD (XAU/USD) – Technical Analysis
Gold (XAU/USD) continues to trade within a defined descending channel, capped by a stubborn resistance band near $3,270.
The metal attempted a breakout early Friday but failed to close above the 50-period SMA at $3,269.98, aligning closely with the descending trendline—a confluence zone acting as a barrier to bullish continuation.
Candlestick behavior shows indecision, with a spinning top forming near resistance, reinforcing the need for caution.
Technically, gold printed a series of higher lows from the $3,215 zone, suggesting gradual accumulation. Yet, no higher high has confirmed a trend reversal.
The Relative Strength Index (RSI) hovers at 53.47, near-neutral territory, but diverges modestly against recent price highs—a signal that bullish momentum is fading unless a fresh catalyst emerges.
The key pivot to watch is $3,270. A sustained break above this level, particularly with a bullish engulfing candle and volume spike, could open the door to $3,300 and $3,320.
However, price remains below the SMA and trapped beneath the trendline. Until bulls reclaim the $3,270–$3,275 zone, downside risks linger. A rejection here could lead to renewed bearish pressure toward $3,215, with deeper support at $3,171.
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EUR/USD Price Analysis – May 05, 2025
Daily Price Outlook
During the early European trading session on Monday, the EUR/USD currency pair extended its modest rebound and moved closer to the 1.1360 mark.
The pair found support as the US Dollar (USD) remained under pressure due to growing market caution ahead of the upcoming Federal Reserve (Fed) policy decision and renewed speculation over potential ECB rate cuts.
EUR/USD Strengthens as ECB Rate Cut Bets Stay Intact Despite Hotter Inflation
On the EUR front, the shared currency held broadly steady on the day, but optimism around additional interest rate cuts by the European Central Bank (ECB) provided underlying support.
This came even after the latest Eurozone Harmonized Index of Consumer Prices (HICP) data for April showed inflation rising faster than expected. In the meantime, the core HICP jumped to 2.7% year-on-year, beating both forecasts of 2.5% and the prior 2.4% reading, while headline inflation climbed to 2.2%.
Despite this, traders seem more focused on the broader economic challenges facing the Eurozone, including the possible fallout from former US President Donald Trump’s protectionist stance, rather than short-term inflation pressures.
Supporting this dovish outlook, ECB Vice President Luis de Guindos commented in a recent interview that the central bank is likely to continue reducing rates, depending on the inflation trajectory.
Moreover, investor sentiment in the Eurozone improved in May, with the Sentix Investor Confidence Index rising to -8.1 from -19.5, suggesting a mild recovery in outlook despite external risks.
US Dollar Pressured by Fed Policy Uncertainty and US-China Trade Tensions
On the US front, the broad-based US dollar Index (DXY) dropped toward 99.80 and stayed weak within Friday’s range. Investors are being cautious ahead of the Federal Reserve’s policy meeting on Wednesday.
While the Fed is expected to keep interest rates steady at 4.25%-4.50%, the market is paying close attention to the statement and Fed Chair Jerome Powell’s press conference for any hints of a future policy change.
Although recent strong US jobs data and high inflation expectations may prevent the Fed from cutting rates soon, investors are also worried about the possible economic effects of former President Trump’s proposed tariffs. This adds more uncertainty to the outlook.
In addition, tensions between the US and China over trade are hurting market confidence. President Trump said some trade deals might be announced soon, but he also admitted there’s been no direct contact with Chinese President Xi Jinping. This lack of communication keeps investors concerned about potential trade disruptions.
EUR/USD – Technical Analysis
The EUR/USD pair is struggling to reclaim ground above its descending trendline, trading just below the 50-period Simple Moving Average (SMA) at $1.13530.
Friday's candles printed a rejection wick near the $1.13423 resistance—right where the SMA intersects the trendline—underscoring a strong technical ceiling for now.
Price action remains capped within a bearish channel that’s been intact since the $1.14500 rejection in April.
From a structural view, the pair is forming lower highs and lower lows, preserving bearish momentum. A cluster of indecisive candles, including a spinning top and weak bullish attempt, adds weight to short bias near resistance.
The RSI sits at 46.97, slightly below neutral, with its average at 40.77—indicating a slight bearish lean but no oversold signal yet. No bullish divergence is present.
Key to the bearish outlook is the inability to sustain a close above $1.13423. A confirmed break lower from current levels could expose $1.12676 support, with further downside toward $1.12285.
However, if bulls manage a clean close above $1.13530 with strong volume, it may flip near-term sentiment and force a squeeze toward $1.13901.
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EUR/USD Price Analysis – May 02, 2025
Daily Price Outlook
During Friday’s European session, the EUR/USD pair continued to hold steady near the 1.1320 mark, supported by a weakening US Dollar amid rising expectations of a Fed rate cut and renewed trade optimism. The euro remains firm as upbeat Eurozone inflation data adds to the currency's appeal, even as the broader economic outlook remains cautious.
EUR/USD Supported by Weak USD and Easing Trade Tensions
The EUR/USD strength is largely attributed to a broad decline in the US Dollar, which is under pressure despite signs of easing trade tensions between the US and China.
Market sentiment improved after the Chinese Commerce Ministry signaled openness to resuming trade talks with Washington, urging the US to demonstrate sincerity.
Meanwhile, US President Donald Trump also expressed optimism about potential trade agreements with South Korea, Japan, and India, boosting global risk appetite.
Although easing trade tensions typically support the USD by improving consumer confidence and reducing inflationary risks, caution ahead of the US Nonfarm Payrolls (NFP) report kept the greenback under pressure.
Economists expect the US economy to add only 130K jobs in April, well below the previous reading of 228K. The Unemployment Rate is expected to hold at 4.2%, while wage growth is projected to rise 0.3% monthly and 3.9% annually.
Euro Gains on Hotter-Than-Expected Eurozone Inflation Data
Moreover, the pair was further boosted by stronger-than-expected preliminary inflation figures from the Eurozone. According to Eurostat, the core Harmonized Index of Consumer Prices (HICP) rose by 2.7% year-on-year in April, beating the forecast of 2.5%. The headline HICP also surprised to the upside, increasing 2.2% annually. On a monthly basis, core and headline HICP jumped by 1.0% and 0.6%, respectively, indicating persistent price pressures in the bloc.
Despite the inflation surprise, the European Central Bank (ECB) is still expected to proceed with a 25 basis point rate cut in June. Policymakers remain more concerned about the economic impact of new US tariffs than inflation itself. Earlier this week, ECB’s Olli Rehn stressed the need for policy expansion and did not rule out cutting rates below the neutral level if necessary, highlighting downside risks to inflation.
EUR/USD Outlook Hinges on NFP and Central Bank Policy Expectations
Looking ahead, the EUR/USD pair’s direction will be influenced by the outcome of the US NFP report and evolving market expectations for both the Fed and ECB.
According to the CME FedWatch tool, there’s now a 58.6% probability that the Fed will lower rates in June, following a steady policy in May.
With Eurozone inflation running hotter but growth still vulnerable, any soft US data could further pressure the USD and provide near-term support to EUR/USD around the 1.1300 level.
EUR/USD – Technical Analysis
EUR/USD is trading within a well-defined descending channel, attempting a mild recovery after bottoming near $1.12676. Price is currently approaching short-term resistance near $1.13466, a level that previously acted as support.
While a small bullish impulse has developed, the pair remains below the 50-SMA at $1.13694, which continues to slope downward—reinforcing bearish pressure in the medium term.
From a candlestick perspective, the pair has not yet shown convincing bullish formations like three white soldiers, and the latest candles resemble neutral bodies rather than strong directional signals.
The RSI has turned up from oversold levels and now sits at 44.84, reflecting short-term recovery momentum. However, unless the pair clears the upper boundary of the bearish channel and sustains above the $1.13466 zone, the upside is likely to remain capped.
The broader structure still favors a continuation to the downside, especially if price fails at the current resistance and prints a bearish engulfing or another reversal signal near the 50-SMA.
A break below $1.13466 could reactivate bearish momentum toward $1.12676 and potentially $1.12285. On the flip side, a confirmed push above $1.13901 would challenge this outlook and suggest short-term trend reversal.
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- GOLD Price Analysis – May 02, 2025
GOLD Price Analysis – May 02, 2025
Daily Price Outlook
Gold (XAU/USD) is currently hovering around $3,260, following a three-day losing streak that was halted by a slight bounce. This struggle can be attributed to easing tariff tensions and growing hopes of a potential trade deal between the United States and China.
Initially, the market reacted negatively, but the rising uncertainty and potential risks from these trade talks have increased demand for Gold as a safe-haven asset, pushing its price higher. Investors typically turn to Gold when trade tensions or economic uncertainties rise.
Meanwhile, the statement from China’s Commerce Ministry highlighted the US’ repeated expressions of willingness to engage in tariff discussions, signaling potential progress.
However, China also urged the US to demonstrate “sincerity” before formal talks could begin, indicating that there are still hurdles to overcome before an agreement is reached.
This hope for a de-escalation in trade tensions has overshadowed Gold’s rally, as the precious metal is often seen as a safe-haven asset during periods of uncertainty. The easing of trade-related concerns typically shifts investor interest away from Gold, driving its price lower.
Fed's Interest Rate Decisions and the Impact on Gold
Looking ahead, the Federal Reserve’s stance on interest rates remains a crucial element for Gold’s trajectory. As of now, the CME FedWatch tool shows that the probability of an interest rate cut at the Fed’s May meeting stands at just 6.4%, while the odds of a cut in June are at 57.8%.
However, the significant shift in market sentiment could occur if the Nonfarm Payrolls data, set to be released later this Friday, comes in significantly below expectations.
A weak jobs report could heighten expectations for a rate cut, which would likely benefit Gold by weakening the US Dollar and increasing demand for the metal.
GOLD (XAU/USD) – Technical Analysis
Gold is trading within a descending channel after failing to sustain above the $3,294.47 resistance, corresponding with the 78.6% Fibonacci retracement level from the April high to recent lows.
Price recently rebounded from the $3,202.89 low, printing a modest sequence of higher lows that hint at a short-term recovery attempt, but overall bias remains bearish unless price breaks above the channel resistance.
Technically, a spinning top formed on the latest 4H candle signals indecision after a small bullish impulse. RSI stands at 44.04, still below the 50 neutral line, reflecting sluggish momentum.
There’s also a mild bullish divergence between RSI and price lows, suggesting downside momentum may be fading—but it's not strong enough to flip sentiment without confirmation.
The 50-SMA at $3,313.58 continues to slope downward, reinforcing resistance around the $3,294 pivot. Price is currently pressing against the 38.2% Fib level at $3,247, and struggling to reclaim ground above the $3,261 midpoint. Until bulls can close decisively above $3,294, rallies may be sold.
Key support lies at $3,230, the 23.6% Fib, followed by the recent swing low at $3,202. A drop below $3,230 could invite another wave of selling, potentially forming a three black crows pattern if the next candles turn aggressively bearish.
A bearish bias holds unless price breaks and holds above $3,294 with volume.
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S&P500 (SPX) Price Analysis – May 02, 2025
Daily Price Outlook
During the early US trading session, the S&P 500 index (SPX) extended its gains and climbed to 5,604.14, up 35.08 points.
The rally was largely supported by renewed optimism over easing US-China trade tensions and growing hopes for a Federal Reserve interest rate cut in June. These factors bolstered investor sentiment and helped drive the index to fresh highs.
S&P 500 Strength Boosted by Easing Trade War Fears and Diplomatic Signals
The S&P 500’s upward momentum was fueled by encouraging developments in US-China trade relations. Comments from China’s Commerce Ministry indicated a willingness to resume talks with Washington, stating that “the door is open” for negotiations.
In return, US President Donald Trump expressed optimism about reaching a trade agreement, emphasizing that a deal would be on favorable terms for the US.
This sentiment was reinforced by Washington’s hints at potential trade deals with other key partners including South Korea, Japan, and India.
Traders reacted positively to these signs of diplomatic progress, reducing fears of further tariff escalation and supporting risk appetite in equity markets.
Fed Rate Cut Bets Add to Bullish Outlook for Equities
Apart from trade developments, hopes for monetary policy easing also underpinned the S&P 500’s rally. The CME FedWatch Tool shows markets are now pricing in a 58.6% chance of a rate cut at the June Federal Reserve meeting. This shift comes as several recent US economic indicators point toward a slowdown.
Notably, initial jobless claims climbed to 241,000 last week—the highest level since February—and the ISM Manufacturing PMI stayed in contraction for a second straight month, slipping to 48.7 in April.
Meanwhile, the ADP employment report and upcoming Nonfarm Payrolls (NFP) data suggest a cooling labor market, with April job gains projected at just 130K compared to 228K in March.
Average Hourly Earnings are expected to rise 0.3% monthly and 3.9% year-over-year, offering insight into inflationary pressures.
Investor Caution Ahead of Key Economic Data and Inflation Trends
Despite the positive equity momentum, investors remain cautious ahead of the NFP report and upcoming inflation figures.
The US Dollar, which recently rose to a three-week high amid global trade optimism, is facing some pressure as traders brace for signs of slowing growth.
The possibility of four quarter-point Fed rate cuts by year-end has also gained traction following disappointing GDP and PCE inflation data.
These combined factors—moderating inflation, trade de-escalation, and softening labor indicators—are feeding expectations that the Fed may pivot toward a more dovish stance to support economic stability.
Until then, the S&P 500 is likely to remain sensitive to both trade developments and economic releases, as markets continue to navigate a complex global landscape.
S&P 500 – Technical Analysis
The SPX is showing continued strength after breaking above key levels earlier this week. Recent action indicates that the index is firmly testing resistance around 5604 as it climbs from lower levels in April.
Price recently closed above the 50-SMA, which now serves as dynamic support. Although the latest candle featured a slight rejection at the upper band, it appears more like a brief pause rather than a sign of reversal.
Structurally, the index is forming a rising wedge with a series of higher lows that confirm the bullish trend. The RSI currently reads 61.33, indicating healthy momentum without yet reaching overbought levels.
Candlestick patterns, including a small spinning top, have emerged, suggesting some caution among traders—but no major bearish formations like three black crows have materialized.
The absence of significant divergence between price and RSI further supports the view that upward pressure could persist if bulls maintain their grip.
Technically, the market is looking for a break above the recent resistance at 5604. Should bulls succeed, the next target could be set at 5781, with further gains possible if momentum builds.
Conversely, if price falls back and breaches support at 5426, the index may retest lower levels around the 50-SMA as a fallback.
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USD/JPY Price Analysis – May 01, 2025
Daily Price Outlook
During Thursday's European trading session, the USD/JPY currency pair continued its upward momentum, climbing to the 144.25 level.
However, the surge was largely driven by the dovish stance of the Bank of Japan (BoJ) and growing optimism surrounding the potential de-escalation of the US-China trade conflict.
Therefore, the combination of these factors weighed heavily on the Japanese Yen (JPY) and contributed to the gains in the USD/JPY pair.
BoJ's Dovish Outlook Dampens Expectations for Rate Hike
However, the recent BoJ meeting played a key role in the Yen's decline. The BoJ kept its interest rate at 0.5%, as expected, but its cautious outlook reduced hopes for a rate hike soon.
Governor Kazuo Ueda said Japan’s inflation wouldn't hit the 2% target in the short term, delaying any rate increase plans for June or July. This, along with a lowered inflation forecast for fiscal 2026, highlights Japan's struggle to achieve stable inflation, weakening the Yen further.
Ueda also mentioned that Japan's economic outlook is uncertain, mainly due to global trade issues, especially ongoing US tariffs. While Japan’s economy is "roughly on track," changes in US trade policy could have a big impact on Japan’s monetary decisions.
US-China Trade Optimism Adds Pressure to the JPY
Meanwhile, renewed optimism surrounding US-China trade relations also weighed on the Yen. US President Donald Trump’s remarks fueled market sentiment, suggesting the possibility of a trade deal with China, and the broader hope that the US-China trade war could de-escalate.
This positive tone surrounding risk assets undermined the JPY, traditionally a safe-haven currency in times of uncertainty, as investors favored higher-yielding assets.
Trump’s comments about trade deals with countries such as India, South Korea, and Japan, along with the "very good probability" of reaching a deal with China, further bolstered optimism in the markets.
These signals of de-escalation helped support the USD, as investors took a more risk-on approach, leaving the JPY vulnerable to further declines.
US Economic Data and Fed Rate Cut Speculation
On the other hand, the US economic data painted a mixed picture. The latest employment figures from ADP showed a sharp slowdown in private-sector job growth in April, with only 62,000 new jobs added, well below expectations.
Meanwhile, the US GDP contracted by 0.3% in Q1 2025, stoking concerns about a potential US recession. Additionally, the US Personal Consumption Expenditures (PCE) Price Index, a key inflation gauge, edged lower to 2.3% in March, adding to the belief that inflationary pressures are easing.
Despite the somewhat gloomy data, market participants remain focused on the Federal Reserve's dovish outlook.
There is growing speculation that the Fed may resume its rate-cutting cycle in June, with traders pricing in the possibility of a full 100 basis points cut by the end of the year.
Therefore, the prospect of further rate cuts by the Fed weighs on the USD, limiting its strength, but the overall positive risk sentiment and market optimism around US-China trade relations continue to support the USD/JPY pair's bullish trend.
USD/JPY – Technical Analysis
USD/JPY has broken out aggressively from consolidation and is now trading at 144.38, having breached a critical resistance at 144.03. Price surged from the ascending channel’s lower boundary, confirming the bullish structure, and is now approaching the midline of the rising parallel channel.
A bullish engulfing candle formed at the breakout point, supported by strong volume and follow-through, suggests further upside potential.
The 50-period SMA at 142.976 has begun sloping upward and now aligns with dynamic support. Price is trading firmly above both the 50 SMA and the channel’s median line, signaling trend continuation.
The RSI is currently at 72.82—technically overbought—but historically, during strong uptrends, it tends to hover above 70 for extended periods. No immediate divergence is visible, which further supports the bullish outlook.
Immediate resistance stands at 145.13, with further upside potential toward 146.15 and 147.15 if momentum continues.
On the downside, 144.03 is the key breakout level to watch; any retest that holds could offer a buying opportunity. Further support sits at 143.01, which aligns with the ascending trendline and SMA support.
While RSI suggests some caution, the overall structure—breakout above resistance, channel continuation, and SMA alignment—favors bulls.
A daily close above 145.13 could confirm further gains toward 146.15, completing the next leg of the ascending channel.
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- GOLD Price Analysis – May 01, 2025
GOLD Price Analysis – May 01, 2025
Daily Price Outlook
Gold prices (XAU/USD) have shown a bearish trend through the first half of the European session, trading around the $3,219 region. However, the global risk sentiment remains bolstered by signs of easing trade tensions between the US and China, the world’s two largest economies. This, coupled with a stronger US Dollar, has pushed traders away from the safe-haven precious metal for the third consecutive day.
US-China Trade Optimism Boosts Risk Appetite and Weighs on Gold
Investor sentiment received a boost following optimistic comments from US President Donald Trump, who indicated a “very good probability” of reaching a trade deal with China. He also mentioned potential trade agreements with other countries such as India, South Korea, and Japan.
These remarks add to the already positive outlook, easing some of the trade-related uncertainties that had previously weighed on markets. As a result, the US dollar saw upward momentum, further pressuring the gold price lower.
Therefore, the ongoing optimism surrounding US-China trade relations and the potential for economic recovery have been key drivers of this risk-on sentiment, which tends to divert flows away from safe-haven assets like gold.
Weak US Economic Data and Easing Inflation Support Gold Despite Bearish Momentum
In addition to the positive trade developments, the weak economic data from the US further supported bearish momentum for gold. On the data front, the US economy contracted by 0.3% in the first quarter of 2025, following a growth rate of 2.4% in the previous quarter.
Consequently, the disappointing GDP figures reignited concerns over a potential US recession, while a surprise drop in private sector employment, with ADP reporting only 62K job additions in April, further fueled worries.
Moreover, the Personal Consumption Expenditures (PCE) Price Index, the Fed’s preferred inflation gauge, showed signs of easing inflation, with the YoY rate slipping to 2.3% in March, down from 2.5% in February. The core PCE, which excludes food and energy prices, also softened to 2.6%, reinforcing expectations of a more dovish Fed policy stance.
As a result, the weak economic data has intensified bets that the Federal Reserve will accelerate its rate-cutting cycle in June. Market expectations are now pricing in a 100-basis-point rate cut by the end of 2025.
Thus, the US Dollar may stay strong in the short term due to US-China trade optimism, but Fed rate cut expectations could limit its rise and support gold in the long run.
Geopolitical Tensions and US Economic Data to Impact Gold Prices
On the geopolitical front, the escalating tensions between Russia and Ukraine continue to contribute to market uncertainty. Russian drone attacks on Ukraine have resulted in civilian casualties, further fueling global risk aversion.
These factors may limit losses for gold in the short term as investors remain cautious about broader geopolitical risks.
Moving ahead, traders now look forward to key US macroeconomic releases, including the ISM Manufacturing PMI later this Thursday and the Nonfarm Payrolls report on Friday.
These releases will play a significant role in shaping the Federal Reserve's policy decisions and could have a big impact on gold prices.
If the data shows that the US economy remains weak, it could increase expectations for further interest rate cuts by the Fed. This would likely limit the strength of the US Dollar and provide some support for gold prices in the weeks ahead, as investors may look to it as a safe haven.
GOLD (XAU/USD) – Technical Analysis
Gold (XAU/USD) remains entrenched in a descending wedge pattern, struggling to reclaim resistance above $3,260. The price has sharply declined from April highs, forming a series of lower highs and lower lows, with clear rejection from the $3,314 zone.
Candlestick structure is bearish, including a series of red-bodied candles and a breakdown through $3,261, reinforcing downside bias. The 50 SMA at $3,299 continues to act as dynamic resistance.
The RSI sits near 30.2, teetering on the edge of oversold territory without showing divergence—suggesting sellers remain in control. The presence of a spinning top followed by another bearish candle hints at indecision followed by renewed pressure.
If $3,222 breaks, expect a slide toward $3,188 and $3,153. For bulls to regain momentum, a decisive close above $3,260 and the wedge’s upper trendline is essential. Until then, short positions remain technically favorable.
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AUD/USD Price Analysis – May 01, 2025
Daily Price Outlook
During European trading session, the AUD/USD currency pair faced downward pressure and remain under pressure around 0.6384 level as traders remained cautious ahead of the US Institute for Supply Management’s (ISM) Manufacturing Purchasing Managers Index (PMI) data. However, the Australian Dollar found some support following the release of Australia’s strong trade balance data.
AUD/USD Under Pressure Amid US Economic Weakness and Trade Optimism
On the US front, the US dollar is benefitting from a combination of factors, including growing optimism over US trade talks. President Donald Trump signaled a high likelihood of reaching a trade deal with China, with the possibility of future agreements with India, South Korea, and Japan. His remarks came after Beijing exempted certain US goods from its hefty tariffs, fueling expectations of an easing in trade tensions.
Moreover, the US economic outlook remains a key driver of USD strength. Recent data indicated a contraction in US GDP, with a 0.3% annualized decline in Q1 2025, missing expectations of growth.
Despite this, the US Dollar Index (DXY), which tracks the greenback against six major currencies, strengthened to around 99.70, extending its rally for the third consecutive day. This upward momentum was fueled by softening market expectations of aggressive rate cuts by the US Federal Reserve.
AUD/USD Supported by Australia’s Robust Trade Surplus
On the other hand, the Australian Dollar received support from the country’s trade data. The Australian Bureau of Statistics reported a substantial trade surplus of AUD 6.9 billion for March, well above the forecasted AUD 3.13 billion and the revised February figure of AUD 2.85 billion.
This strong surplus was driven by a 7.6% rise in exports, with imports declining by 2.2%. The data bolstered the Australian Dollar, offering relief amid a cautious global economic outlook.
Furthermore, Australia’s inflation data also helped support the AUD. The Consumer Price Index (CPI) for Q1 2025 rose by 0.9% quarter-over-quarter, exceeding market expectations of 0.8%.
The annual CPI increase of 2.4% also surpassed forecasts, which could indicate that inflationary pressures are not as subdued as previously anticipated. As a result, market expectations for further interest rate cuts from the Reserve Bank of Australia (RBA) have softened.
RBA’s Policy Outlook and US Tariffs Impact on AUD/USD
Despite the encouraging trade and inflation data, the Australian dollar faces challenges as markets remain wary of potential economic fallout from US tariffs. Moreover, the RBA’s cautious stance on further rate cuts amid persistent inflation pressures suggests that Australia’s economy is still under strain, limiting the upside for the AUD.
AUD/USD – Technical Analysis
The Australian Dollar (AUD/USD) is trading under pressure near $0.63900 after rejecting key resistance at $0.64192. Price action remains capped by a descending trendline that has contained rallies since April 15, reinforcing the short-term bearish structure.
The recent rejection forms a lower high near $0.64205, just beneath a confluence of resistance levels and the 50-hour SMA, currently at $0.63974, acting as dynamic resistance.
The current candlestick structure reveals bearish continuation potential, with a strong bearish engulfing candle forming after multiple indecisive attempts to break the $0.64192 zone.
The RSI has turned lower from 53.38 and now prints at 44.84, suggesting waning bullish momentum and no divergence—aligning with broader bearish sentiment.
On the downside, immediate support lies at $0.63662, followed by $0.63487 and then $0.63335. If the pair breaches $0.63659 with follow-through, the move could extend to test April’s lows.
The confluence of the descending trendline and failure to establish higher highs reaffirms bearish bias. A confirmed break below $0.63985 would validate short entries, targeting $0.63659 while capping risk with a stop-loss above $0.64205.
With both price and RSI failing to push higher and no bullish reversal patterns present (e.g., Doji, Hammer, or Piercing Line), the path of least resistance remains to the downside. Unless price recovers and sustains above the 50 SMA, intraday rallies may continue to be sold into.
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GOLD Price Analysis – April 30, 2025
Daily Price Outlook
During the European trading session on Wednesday, the price of gold (XAU/USD) dropped more than 1%, trading near $3,274. The decline marks a second consecutive day of profit-taking amid improving global trade sentiment and caution ahead of crucial US economic data releases.
However, the recent pullback in gold prices is largely driven by rising optimism surrounding global trade. US President Donald Trump signed an executive order easing tariffs on car parts, signaling positive progress in trade negotiations, according to Bloomberg.
The move has sparked hopes that further de-escalation in trade tensions could be on the horizon, reducing demand for traditional safe-haven assets like gold.
Gold's Bullish Momentum Eases Ahead of Key US Economic Data and Fed Rate Outlook
Looking ahead, traders are now focusing on the upcoming release of the US Gross Domestic Product (GDP) report for Q1, which is scheduled for 12:30 GMT. Economists expect a slowdown in economic growth, with forecasts suggesting just a 0.4% annualized increase.
This is much lower than the 2.4% growth seen in Q4 2024. The GDP data will be important in shaping the Federal Reserve’s next move on interest rates.
Alongside the GDP report, the March Personal Consumption Expenditures (PCE) Price Index is also due. This is the Fed’s preferred measure of inflation.
The Core PCE, which excludes food and energy, is expected to drop to 0.1% from 0.4%, and the overall headline PCE is expected to come in at 0%, down from 0.3%.
If these inflation numbers show a cooling trend, it could increase hopes that the Fed may take a softer approach at its May 7 policy meeting.
At the same time, former President Trump has again criticized Fed Chair Jerome Powell, claiming he understands interest rates better than him. This political tension adds more uncertainty to what the Fed might do next.
Gold’s Long-Term Appeal Remains Supported Despite Short-Term Pullback
Despite the recent decline, long-term demand for gold remains strong. The World Gold Council reports that global investors added around 227 tons of gold to ETFs in Q1, marking the largest inflow since 2022 and driving a 19% rally.
However, with trade tensions easing and US economic data coming into focus, short-term sentiment has shifted to a more cautious outlook.
In India, one of the world's largest gold consumers, jewelry sales dropped in March, and they are expected to decline by up to 11% through the fiscal year ending in March 2026, according to Bloomberg. This adds additional pressure on global physical gold demand.
While gold prices may face short-term pressure due to weak jewelry demand in India and cautious sentiment, strong ETF inflows and long-term demand may support a potential rebound later.
GOLD (XAU/USD) – Technical Analysis
Gold is consolidating just above an ascending trendline support drawn from the April 19 low, while capped below a descending channel top from the $3,410 swing high. The price is coiling inside a symmetrical triangle, suggesting a breakout is likely.
Price is currently below the 50-period EMA ($3,313.50), which is acting as dynamic resistance, while support remains intact near $3,306.94 and the broader $3,273.00 zone.
Recent candles show multiple spinning tops and small-bodied dojis, reflecting indecision at a key technical junction. The absence of momentum suggests traders are awaiting a fundamental catalyst.
However, price action continues to print higher lows, showing underlying bullish intent. A close above $3,313.50 could trigger a bullish continuation toward $3,352.47, and potentially $3,379.07.
The Relative Strength Index (RSI) is hovering around 45.68, below the midpoint, and diverging slightly from price—a potential sign of fading downside pressure.
No bearish engulfing or three black crows are visible on this timeframe, but the failure to print a clean bullish engulfing or hammer near support also implies hesitancy among buyers.
If gold fails to hold above $3,306.94, it may retest the ascending trendline near $3,273.00. Below that, key horizontal support rests at $3,246.38 and then $3,212.28.
Overall, a break above the triangle and reclaim of the 50 EMA could shift short-term sentiment back to bullish.