GBP/USD Price Analysis – May 07, 2025
Daily Price Outlook
During the mid-European trading hours, the GBP/USD currency pair steadied around the 1.3350 mark after a sharp upward move on Tuesday.
The pair found solid support as investors reacted positively to news that the United Kingdom and the United States are nearing a bilateral trade deal.
This development sparked optimism that a reduction in trade barriers could boost transatlantic commerce and support UK exports, particularly in steel and automobiles.
According to the Financial Times, the deal would see the US lower tariffs on UK steel and cars, while the UK would ease duties on US agricultural products and amend its digital services tax.
This mutual concession is seen as a step forward in strengthening UK-US trade ties post-Brexit and has provided the British Pound with a buffer amid global economic uncertainties.
GBP/USD Reacts Cautiously Ahead of BoE Decision and Fed’s Steady Outlook
Despite the positive trade developments, the GBP/USD pair faced mild pressure as the US Dollar gained some traction ahead of the Federal Reserve’s monetary policy announcement.
The Fed is widely expected to keep interest rates unchanged in the 4.25–4.50% range for a third consecutive meeting.
Fed Chair Jerome Powell and other officials have maintained a cautious stance, preferring to assess the economic impact of new tariff policies and elevated inflation expectations before making any adjustments.
Meanwhile, investors are closely watching the Bank of England’s upcoming policy decision, scheduled for Thursday. The BoE is expected to lower interest rates by 25 basis points to 4.25%, marking its fourth rate cut since the easing cycle began in August last year.
Market participants are especially focused on the BoE’s guidance, with speculation mounting that the central bank could adopt a more aggressive easing tone given rising global trade concerns and competitive pressures from China.
Pound Supported by Trade Hopes but Faces Pressure from Rate Cut Outlook
On the other side, the GBP remains broadly supported on the back of UK-US trade optimism, yet the growing anticipation of monetary easing by the BoE is capping further gains.
Investors worry that a global shift in supply chains—particularly an increase in Chinese exports—could hurt the competitiveness of UK products. As a result, policymakers may feel increased urgency to support the domestic economy with looser financial conditions.
Meanwhile, US-China trade discussions are also on the radar, with US officials set to meet their Chinese counterparts in Geneva later this week.
Thus, the positive breakthrough in those talks could lift broader risk sentiment, potentially providing further near-term direction for the GBP/USD pair.
GBP/USD – Technical Analysis
GBP/USD is trading near $1.3351, maintaining its recent upward momentum within a rising trendline that has supported the pair since early May.
The 50-day Simple Moving Average (SMA) at $1.3324 is providing critical dynamic support, aligning closely with the recent swing low, reinforcing the short-term bullish bias. The pair's steady climb is characterized by a series of higher lows, indicating sustained buying interest.
The recent pullback found support around the $1.3324 level, coinciding with the trendline and the 50-SMA, confirming this as a key pivot zone.
A break above the immediate resistance at $1.3385 could trigger further gains toward the next significant resistance at $1.3413, a level that aligns with a previous consolidation area. Beyond this, the $1.3442 mark represents a major swing high, acting as the next key target for bulls.
The Relative Strength Index (RSI) is currently at 55.86, suggesting mild bullish momentum with room for further upside before hitting overbought levels.
However, a break below the trendline and the $1.3324 support could expose the pair to a deeper correction, potentially targeting the next support at $1.3309, followed by the $1.3258 level.
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- GOLD Price Analysis – May 07, 2025
GOLD Price Analysis – May 07, 2025
Daily Price Outlook
During Wednesday’s session, gold (XAU/USD) pulled back from its recent gains, slipping to $3,380 as traders weighed the impact of renewed US-China trade optimism and awaited the outcome of the Federal Reserve’s policy meeting.
The yellow metal snapped a two-day winning streak as investors took profits and shifted focus to improving diplomatic signals between the world’s two largest economies.
Gold Pressured by US-China Trade Talks and Diminished Safe-Haven Demand
However, the latest retreat in gold prices was driven by fresh hopes of progress in US-China trade relations. Statements from both Washington and Beijing confirmed that trade discussions are set to resume this weekend in Switzerland.
US Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer will meet with China’s Vice Premier He Lifeng.
Though the talks are initially aimed at de-escalating tensions rather than finalizing trade agreements, the move was interpreted as a positive step toward easing tariff-related uncertainties.
This development reduced demand for traditional safe-haven assets like gold, even amid heightened geopolitical risks in South Asia.
Reports from Pakistan indicated it had shot down five Indian fighter jets and captured soldiers in retaliation for Indian air strikes.
However, the market reaction to the military escalation was muted, as optimism surrounding trade talks took center stage, offsetting the usual bullish impact of geopolitical tensions on gold.
Traders Cautious Ahead of Fed's Interest Rate Decision Amid Political Pressure and Economic Uncertainty
Traders also remained cautious ahead of the Federal Reserve's upcoming interest rate decision scheduled for later in the day.
According to the CME FedWatch Tool, markets are pricing in a 95.6% probability that the Fed will hold rates steady.
This suggests that a rate cut would come as a significant surprise, especially amid persistent political pressure from President Donald Trump urging the central bank to ease monetary policy.
Fed officials have signaled that future decisions will be guided by data and the broader economic outlook.
With inflation still being monitored closely and the full impact of tariffs yet to be felt, policymakers appear inclined to maintain the current stance, keeping investors on edge.
GOLD (XAU/USD) – Technical Analysis
Gold is trading near $3,393, consolidating just above the 23.6% Fibonacci retracement at $3,381, a key level after its recent bullish surge.
The 50-day Simple Moving Average (SMA) at $3,302 is providing a robust support base, aligning with the 61.8% Fibonacci level at $3,301, reinforcing the bullish structure.
The recent uptrend is marked by a series of higher lows, supported by a rising trendline from late April, indicating continued buying interest.
Candlestick analysis reveals a potential Doji near the $3,393 resistance, reflecting market indecision at this critical level.
A break above this zone could pave the way for a rally toward the next resistance at $3,430, followed by the psychological $3,450 mark, aligning with the recent swing high.
However, a failure to clear this resistance could trigger a pullback toward the 38.2% Fibonacci level at $3,350, with deeper support at $3,326 and $3,302, the latter aligning with the 50-SMA.
Momentum indicators are mixed. The Relative Strength Index (RSI) is hovering near 71, suggesting overbought conditions, which may prompt short-term profit-taking.
However, the overall trend remains bullish as long as prices hold above the key support at $3,348, a critical pivot point.
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EUR/USD Price Analysis – May 07, 2025
Daily Price Outlook
During the European trading session on Wednesday, the EUR/USD pair remained flat near the 1.1370 mark, consolidating within a tight range as investors awaited the highly anticipated US Federal Reserve’s monetary policy decision. The pair's movement reflects broader market indecision, driven by both political stabilization in Europe and economic uncertainties in the US.
EUR/USD Stability Backed by German Political Clarity and Euro Strength
On the EUR front, the shared currency found some support following the confirmation of Conservative leader Friedrich Merz as Germany’s new Chancellor. Merz's successful second bid has reduced fears of political instability in the Eurozone’s largest economy.
Markets reacted positively to expectations that his leadership will advance previously approved defense spending and economic support measures, potentially strengthening the Euro and German assets.
Despite this, the Euro's upside remains capped, as the European Central Bank (ECB) is widely expected to continue its rate-cutting cycle in June. Policymakers remain focused on supporting the economy in the face of fresh trade-related shocks, particularly from the US.
ECB officials are prioritizing economic resilience over inflation concerns, especially with Eurozone inflation expected to return to the 2% target this year.
Weak EU Retail Sales and Tariff Concerns Weigh on the Euro
On the data front, the march EU Retail Sales disappointed, falling 0.1% month-on-month against expectations for flat growth.
The year-on-year figure also underperformed, growing only 1.5% versus a forecast of 1.6%, with previous data revised lower. These figures reflect slowing consumer activity, adding to concerns about Eurozone economic momentum.
Moreover, the European Commission is considering retaliatory tariffs in response to new US trade measures. EU Trade Commissioner Maros Sefcovic confirmed that Brussels is exploring countermeasures against approximately €100 billion worth of US goods if talks fail.
Although US President Trump has delayed reciprocal tariffs by 90 days, uncertainty continues to linger, limiting EUR/USD gains.
EUR/USD Awaits Fed Decision Amid US Economic Tensions and Trump Pressure
Looking forward, traders will keep a close eye on the US Federal Reserve, as markets expect interest rates to stay at 4.25%-4.50%. The CME FedWatch Tool fully prices in a pause, but traders will focus on Chair Jerome Powell’s press conference for hints about future policy.
The Fed has made it clear that there won’t be any immediate changes unless there are signs of weakness in the labor market or economic growth.
On the data front, April’s Nonfarm Payrolls (NFP) report showed steady job gains, which makes rate cuts less likely. Meanwhile, the US economy contracted by 0.3% in Q1, mainly due to a rise in imports ahead of new tariffs.
Former President Trump continues to push the Fed for rate cuts, criticizing Powell’s stance even with inflation easing in food and energy sectors, and even threatening Powell's removal.
Therefore, the Fed’s decision to keep rates steady and the mixed economic data could strengthen the US dollar, pressuring the EUR/USD pair.
EUR/USD – Technical Analysis
EUR/USD is trading around $1.1365, consolidating within a descending wedge pattern, a structure typically associated with potential bullish reversals.
The pair is testing the 50-day Simple Moving Average (SMA) at $1.1323, which has acted as dynamic support in recent sessions.
A series of higher lows on the recent bounce from the $1.1265 level suggests building bullish momentum, supported by a minor trendline connecting recent lows.
Candlestick analysis reveals a potential bullish engulfing pattern forming just above the $1.1323 support, reinforcing the bullish case.
However, the pair faces immediate resistance at $1.1380, where a bearish shooting star formed recently, indicating possible short-term selling pressure.
A break above this level could open the door to the next resistance at $1.1421, aligning with the recent swing high. Beyond this, the $1.1452 level stands as a key barrier, representing a critical psychological level for bulls.
The Relative Strength Index (RSI) is currently at 58.75, just below the 60 level, suggesting the pair has room to extend its recovery before entering overbought territory.
However, a break below the immediate support at $1.1323 could trigger a deeper pullback toward $1.1298 or even the critical $1.1265 support, aligning with the lower wedge boundary.
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AUD/USD Price Analysis – May 06, 2025
Daily Price Outlook
During the European trading session, the AUD/USD currency pair has pulled back from a five-month high of 0.6493, slipping to around 0.6450 level. However, this decline comes as the US dollar strengthens ahead of the Federal Reserve’s (Fed) anticipated monetary policy decision on Wednesday.
Although a pause in interest rate hikes is expected, market attention remains on Fed Chair Jerome Powell’s remarks, especially amid uncertainties surrounding trade negotiations and President Donald Trump's calls for rate cuts.
US Dollar Strengthens Amid Fed Uncertainty and Trade Negotiation Hopes
Investor sentiment surrounding the dollar has remained strong in anticipation of the Fed's upcoming policy meeting, where it is widely expected to hold rates steady.
However, market participants are focused on Powell’s comments, particularly in light of ongoing tariff-related uncertainties.
President Trump is pushing for aggressive rate cuts, urging the Fed to change policies. Treasury Secretary Scott Bessent hinted that trade deals with other countries are close, but Trump ruled out talks with China's President Xi this week. China's Commerce Ministry is reviewing US trade proposals.
On the data front, the US ISM Services PMI showed a rise to 51.6 in April, beating expectations of 50.6.
This increase is reflective of stronger demand, with the New Orders Index climbing to 52.3, signaling optimism about economic activity despite looming trade risks.
Australia Faces Rate Cut Expectations Amid Economic Recovery Signals
On the Australian front, the Australian Dollar (AUD) has gained support after Prime Minister Anthony Albanese won a second term in the 2025 Federal Election.
His victory promises a government focused on addressing cost-of-living issues, investing in renewable energy, and implementing tax cuts and healthcare reforms.
These policies are expected to aid economic recovery. However, pressure is still on the Reserve Bank of Australia (RBA) to consider rate cuts.
Meanwhile, Westpac’s CEO believes that the worst of consumer and business stress is over, supporting optimism about Australia’s economic outlook.
However, the National Australia Bank (NAB) forecasts a 50 basis point rate cut by the RBA in May, which could put downward pressure on the AUD.
AUD/USD – Technical Analysis
AUD/USD is trading just above its ascending trendline support at $0.64436, attempting to hold its recent bullish structure after forming a series of higher lows throughout early May.
The pair surged from the $0.63737 low, forming a minor ascending channel, and recently printed a bearish engulfing candle after stalling below resistance at $0.64788.
Despite that rejection, price remains supported by both the trendline and the 50-period EMA at $0.64569, with bulls defending this confluence area aggressively.
From a candlestick perspective, the current pause is characterized by a spinning top and long wicks to both sides, suggesting indecision. The RSI, currently at 43.46, shows mild bearish pressure but no divergence.
A move back above the $0.64699 pivot would tilt the structure in favor of another push higher, particularly if accompanied by a bullish engulfing or a breakout candle with volume confirmation.
Should AUD/USD hold above the $0.64436 area and break above the $0.64788 ceiling, the next major resistance lies at $0.64933, followed by $0.65151. Conversely, a break below $0.64436 would expose the pair to downside risks toward $0.64234 and $0.64193.
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- GOLD Price Analysis – May 06, 2025
GOLD Price Analysis – May 06, 2025
Daily Price Outlook
During the European trading session on Tuesday, Gold (XAU/USD) surged higher for a second consecutive day, supported by growing global geopolitical tensions, market volatility, and ongoing speculation regarding US trade deals and potential Federal Reserve interest rate cuts.
Gold's recent rise can largely be attributed to the escalating geopolitical concerns around the globe. In the Middle East, Israel is getting ready for a major ground offensive in Gaza, aiming to take full control of the region.
This uncertainty has fueled investors’ demand for safe-haven assets like Gold, which tends to benefit from geopolitical risk and instability.
US Trade Deal Hopes Boost Gold’s Safe-Haven Demand
On the US front, the growing expectations of a first trade deal have also contributed to the bullish sentiment in Gold.
US President Donald Trump and his administration have repeatedly hinted that an agreement is close, with US Commerce Secretary Howard Lutnick suggesting that the first deal will be with a top-ten economy.
While the deal is still in the works, the anticipation surrounding it has kept investors on edge, further fueling Gold’s safe-haven appeal.
Forex Market Volatility and Its Impact on Gold's Rise
Apart from this, the forex market volatility is another factor supporting Gold’s rise. On Monday, the Taiwan Dollar (TWD) experienced a sharp appreciation against the US Dollar (USD), sending waves across the foreign exchange markets.
Traders are now cautious, as the move could weaken the US Dollar against other major Asian currencies, reducing its role as a reliable safe haven. If the US Dollar weakens further, Gold stands to benefit as an alternative investment.
Fed Rate Cut Expectations Weigh on US Dollar, Benefiting Gold
Market participants are also keeping an eye on the Federal Reserve’s upcoming decisions on interest rates. According to the CME FedWatch tool, the probability of an interest rate cut by the Federal Reserve in May stands at just 2.4%, with the chances of no change in rates at 97.6%.
However, expectations for a rate cut in June have risen, with a 29.8% chance of a rate reduction. This speculation regarding a more dovish Fed stance has put downward pressure on the US Dollar, which in turn benefits Gold.
Shanghai Gold Exchange Expansion Boosts Yuan-Denominated Gold Products
In addition to this, the Shanghai Gold Exchange has plans to expand its warehouse network into Hong Kong, which could increase the global profile of its yuan-denominated gold products.
This move further solidifies the demand for Gold, as China continues to assert its influence in the global gold market.
GOLD (XAU/USD) – Technical Analysis
Gold has powered through key resistance at $3,350, breaking above the 50-period SMA ($3,273.07) and pushing into a tight descending triangle structure.
Price is now testing the upper boundary of this triangle, which has consistently held since the late-April rejection near $3,449.
The recent rally began after a firm higher low formation near $3,222, confirming bullish structure within a broader ascending channel.
Candlestick momentum is strong, with a near-vertical series of bullish candles—visually resembling a short-term "three white soldiers" pattern.
This signifies aggressive buyer interest. The RSI reading at 73.79 suggests overbought conditions, but no bearish divergence is present yet. Momentum remains intact, though traders should be cautious of potential exhaustion near the $3,408 resistance.
If the breakout clears $3,409 with conviction, the next targets become $3,449 and $3,499.80. A pullback toward $3,305 would still keep the structure intact if buyers defend that level.
Below that, $3,271 and $3,222 remain deeper support. The risk-reward favors the long side for now, with bullish bias maintained above $3,350.
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USD/CAD Price Analysis – May 06, 2025
Daily Price Outlook
During the European trading session, the USD/CAD currency pair failed to stop its downward trend and remained well-offered around the 1.3817 level, hitting the intra-day low of 1.3808.
However, the reason for its downward trend could be attributed to the lack of strong momentum from the US Dollar, which has struggled to build significant follow-through buying.
USD Gains but Economic Uncertainty Caps Bullish Sentiment
On the US front, the broad-based US dollar found some support following a two-day losing streak, driven by an upbeat release of the US ISM Services PMI on Monday. This data injected some optimism into the USD, helping the USD/CAD pair edge higher.
However, the ongoing economic uncertainty, particularly stemming from President Donald Trump's unpredictable trade policies, has hindered the USD's ability to gain further traction. These uncertainties are keeping investors cautious, preventing aggressive positioning in the Greenback.
Canadian Dollar Supported by Stabilizing Crude Oil Prices and US-Canada Trade Deal Hopes
On the other side, the Canadian Dollar (CAD) is benefiting from a stabilization in Crude Oil prices, which are attempting to recover from a near one-month low. The price bounce provides support to the commodity-linked Loonie, limiting further gains in the USD/CAD pair.
Furthermore, the hopes of a potential US-Canada trade deal, driven by Trump's comments about Canadian Prime Minister Mark Carney visiting the White House, are adding optimism to the CAD's outlook.
Investor Caution Ahead of Fed's Rate Cut Path
Investors are taking a wait-and-see approach as they await more clarity on the Federal Reserve's rate-cut path, particularly in light of the upcoming FOMC monetary policy meeting. However, the market is eager to hear from the Fed about its stance, especially after recent US macro data has eased recession concerns.
USD/CAD – Technical Analysis
USD/CAD is trading near $1.38227 after rejecting the descending trendline that has capped price action since April. The pair tested the trendline around $1.38393, posting a near-term rejection candle—a classic shooting star—followed by lower-volume indecision candlesticks (doji and spinning tops), signaling fading bullish momentum.
Price remains beneath the downward-sloping trendline and is also hovering around the 50-period EMA at $1.38177, which has flattened, reflecting a neutral to mildly bearish bias.
Sellers appear to be defending the $1.38481–$1.38393 supply zone, making it a critical short-term resistance area. Below current levels, the first major support lies at $1.37945, with further downside potential toward $1.37893 and $1.37767.
The RSI stands at 49.99, below the 50 neutral line, suggesting neither overbought nor oversold conditions, but lacking bullish conviction. No clear divergence is visible at the moment, though a bearish RSI crossover confirms weakening upward momentum.
Structurally, the pair has been carving out lower highs beneath the trendline and is at risk of resuming the broader bearish channel unless bulls retake $1.38626.
No reversal candle patterns such as three white soldiers or bullish engulfing are present, indicating the recent bounce may be corrective. The setup now favors short entries if the pair breaks below $1.38254 with follow-through, targeting $1.37893, while risk is managed above $1.38481.
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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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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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- 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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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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