US Dollar Index

The US dollar index rebounded above 104.00 last week, posting its best performance in nearly three weeks. Driven by geopolitical unrest. The dollar rose despite a pullback in Treasury yields and the Fed's reaffirmation of its 2025 rate cut path. And tried to get out of the 2025 low of 103.20 hit on Tuesday. The Fed's delay in rate cuts and trade concerns have become the key to driving the dollar's rebound. The Federal Reserve decided on Wednesday to keep interest rates unchanged and reiterated that it would implement two 0.25 percentage point rate cuts this year, in line with its forecast three months ago. This signal did not show the easing tendency expected by the market, boosting confidence in the US dollar. The US dollar shows signs of potential turnaround, and prices are approaching the highs of the recent consolidation range. As the April 2 tariff announcement approaches, the market may reduce short US dollar positions and turn to a neutral stance. The US dollar rebounded from its lows last week, thanks to the Fed's downplaying of interest rate cut expectations and the market's repricing of trade concerns. At the beginning of the year, the expansionary policy expectations after Trump took office pushed the dollar to 110.18, but the recession anxiety caused by the escalation of trade frictions caused it to fall back to 103.20. Now, with the tariffs approaching, the short pressure on the dollar has eased and the index has returned to above 104. The dollar may enter a new round of appreciation window, especially if trade policies further disrupt the global supply chain.

The 14-day relative strength index (RSI) of the technical indicator of the daily chart is gradually rising. In addition, the moving average convergence/divergence (MACD) histogram shows that the downward momentum has weakened. The US dollar index rose for the third consecutive day and its performance this week has turned positive. With the deadline for the US reciprocal tariffs on April 2 approaching, the market may rebound completely to 105.96 (61.8% Fibonacci rebound from 107.66 to 103.20) or fall again to 101.90 (lower track of the daily chart downward channel). If the US Dollar Index is above 104.22 (last week's high), and 104.25 (23.6% Fibonacci rebound level) this week, a move towards 104.77 (20-day simple moving average) may occur. A break below this level points to a sharp rise towards the 105.00 round mark, while the 200-day simple moving average (104.99) also converges at this point, further strengthening this area as a strong resistance level. On the downside, the bearish "death cross" of the 20-day and 100-day simple moving averages around 105.00 may serve as a technical sell signal. 103.63 (9-day simple moving average) is the first target, then 103.20 (this year's low), and 103.00 (round mark) may be considered as bearish targets, if US yields fall further due to worsening US data, if the market further abandons its long-term US dollar position, even 102.53 (76.4% Fibonacci retracement of 100.16 to 110.18) level is also under consideration

Today, consider shorting the US dollar index around 104.28, stop loss: 104.40, target: 103.80, 103.70

WTI spot crude oil

After consolidating above $66.00 in the early part of last week, WTI crude oil prices remained stable for the third consecutive trading day in the second half of the week, reaching a high of $68.57 per barrel this month. Oil prices are still on a continuous upward track and are expected to achieve a second consecutive week of gains, mainly driven by the new US sanctions on Iran. In the middle of last week, the U.S. Treasury Department imposed new sanctions on Iran, targeting an independent Chinese refinery and other entities and vessels involved in supplying Iranian crude oil to China. It is expected that Iran's crude oil exports will decrease by 1 million barrels per day due to the tightening sanctions. In addition, oil prices may find further support as OPEC+ (the Organization of Petroleum Exporting Countries and its allies) implements a new production cut plan for seven member countries until June 2026. Earlier this month, OPEC+ confirmed that its eight member countries will increase production by 138,000 barrels per month starting in April to stabilize the market. Secondly, oil prices are also supported by geopolitical risk premiums. Israel launched a new ground operation in Gaza, while the United States continued its air strikes against Iran-backed Houthi rebels in Yemen.

From the recent technical trend observation, the price reaction near the resistance level of $68.57 (March high) should be paid attention to. If this resistance level is broken, oil prices may rise further to the market psychological level of $70 and the 100-day moving average of $70.57. If it breaks, it will head towards the 200-day moving average at $72.57. The 14-day relative strength index (RSI) of the technical indicators of the daily chart is around 50, and the MACD bar is above the zero axis, but the DIF and DEA are below the zero axis and close to each other, indicating that the long and short forces are relatively balanced. The current US crude oil price is in a volatile pattern, and the short-term trend is unclear. From the moving average system, the price is hovering around the short-term and medium-term moving averages, and the technical indicators also show that the long and short forces are relatively stalemate. However, once the oil price falls below $67.02 (10-day moving average) and $66.07 (last week's low), it will retest the support areas of $65.05 (March 5 low) and $65.00 (market psychological barrier), and may indicate the reappearance of downward pressure.

Today, you can consider going long on crude oil around 68.05, stop loss: 67.90; target: 69.20; 69.40

Spot gold

Before the weekend, gold prices fell back by about 0.70% to around $3,000 due to a stronger dollar and profit-taking, but geopolitical and economic uncertainties linger, coupled with expectations of a rate cut by the Federal Reserve, gold prices rose for the third consecutive week. Traditionally, gold is seen as a safe investment in times of geopolitical and economic uncertainty, and usually performs strongly in a low-interest rate environment. This year, gold has hit 16 all-time highs, reaching an all-time high of $3,057.50 per ounce last Thursday. The current market is intertwined with long and short forces, geopolitical risks and Federal Reserve policy expectations dominate sentiment, and the technical side shows a high overbought signal. The future trend needs to be alert to the risk of short-term correction. Tariff policy uncertainty has exacerbated concerns about the economic outlook, and the safe-haven attribute of gold will continue to stand out in the near future. Geopolitical risks are fermenting. The situation in Gaza and Turkey is the core driver of the current risk aversion sentiment. Geopolitical risks are unlikely to ease in the short term, and the demand for gold as a "crisis hedging tool" remains high. Finally, market sentiment and capital flows. Physical demand support shows that Switzerland exported 147.4 tons of gold to the United States in February, worth more than $14 billion, indicating that institutional and retail investors have a strong willingness to allocate gold in the long term.

The upper track of the "Bollinger Channel" of the daily chart is only $5 away from the historical high ($3057.50), and the opening expansion rate is accelerating, suggesting that the daily level volatility has entered an accelerated stage, and extreme market conditions need to be vigilant. At present, the gold price is more than 15% above the 200-day moving average of $2,634, and the deviation rate from the 100-day moving average of $2,755 is 10%. The daily level has entered a super trend state, and it is necessary to combine other cycles to judge and correct risks. Although the MACD bar chart of the technical indicator remains positive, the difference between DIF (45.62) and DEA (37.14) is 0.3% narrower than the previous value, indicating an initial signal of momentum decay. The current price is close to the upper track of the "Boltinger Band" at $3,062. If it rises again this week, the resistance area formed by the $3,054.00 (178.6% Fibonacci rebound level from $2956 to $2832); $3,057.50; and $3,062 area will challenge $3,080 (200.0% Fibonacci rebound level). Once it breaks through, the next level will point to the resistance level of the integer mark of $3,100. On the other hand, if the gold price falls below the market-recognized key psychological mark of $3,000, it will trigger the daily MACD death cross warning, forming a cross-cycle decline resonance. The short-term trend will weaken. Downside targets include $2,987.00 (10-day moving average), $2,982 (last week's low), and further downside testing $2,945.00 (50.0% Fibonacci retracement of 2,832.50 to 3,057.50).

Today, consider going long on gold before 3,018, stop loss: 3,015; target: 3,040.00; 3.045.00

AUD/USD

Before the weekend, the AUD/USD pair continued to slump, trading below the 0.6300 mark, as the stronger US dollar and disappointing Australian employment data continued to exert pressure. Technical signals are becoming increasingly bearish, indicators are deteriorating, and price action is breaking below important moving averages. AUD/USD has been under pressure for four consecutive trading days since hitting a high of 0.6391 last week, with a low of 0.6258 and currently hovering around 0.6275. The currency pair struggled with a stronger US dollar, with safe-haven demand supporting the US dollar and risk aversion exacerbated by US tariff policies. Meanwhile, US bond yields are falling as investors flock to Treasuries due to economic and geopolitical uncertainties. Federal Reserve Chairman Jerome Powell downplayed the inflationary impact of tariffs, calling them temporary, but acknowledged the challenge of assessing the broader impact. Despite rising recession risks, Powell said they are still relatively low at present. The Australian dollar also faced resistance as traders reassessed the Reserve Bank of Australia's monetary policy stance after disappointing employment data. Australia's unemployment rate remained unchanged at 4.1% in February, but an unexpected drop in employment raised concerns about a weak labor market. The disappointing employment report fueled market speculation that continued labor market weakness could provide the RBA with more flexibility to cut interest rates. However, Assistant Governor of the RBA Sarah Hunt noted earlier this week that while the board acknowledged that there was room to reduce policy constraints after the recent decision to ease policy, it was still more cautious than the market about further rate cuts.

From the daily chart, AUD/USD rose first and then pulled back last week, reaching a one-week low of 0.6258. Currently hovering below the psychological market barrier of 0.6300, short-term sellers dominate the market. The pair fell below the 20-day (0.6304) and 100-day (0.6337) simple moving averages, reinforcing the negative outlook. The technical indicator (MACD) moving average convergence/divergence indicator shows a decrease in green bars, indicating a weakening of bullish momentum. At the same time, the 14-day relative strength index (RSI) fell to 47.00, sliding into negative territory, confirming that downside risks have increased. Therefore, some demand may emerge near the immediate support levels of 0.6271 (last week's low) and 0.6270 (65 simple moving average). If the bearish momentum persists, the next target is around the 0.6200 (round number) level. On the upside, the pair may try to break through the immediate resistance of the 100-day simple moving average at 0.6337. A return to the uptrend may strengthen the bullish outlook and push AUD/USD to retest last week's high of 0.6391. A break below this level will further test the three-month high of 0.6409, which was last reached on February 21.

Today, consider going long on AUD before 0.6260, stop loss: 0.6250; target: 0.6300; 0.6310.

GBP/USD

The British pound fell against the US dollar for two consecutive days before the end of the week, with monetary policy decisions from major central banks dominated by the Federal Reserve and the Bank of England. The Bank of England kept its policy rate unchanged at 4.50% as expected. The Bank of England stuck to its 'gradual and cautious' guidance for further rate cuts. However, the split 8-1 vote to keep rates unchanged came as a hawkish surprise and triggered an upward revision in UK rate expectations. After the meeting, GBP/USD fell, while 10-year Treasury bonds underperformed. Currently, GBP/USD is trading at 1.2920, having hit a weekly high of 1.3011 earlier. GBP/USD extended its correction, approaching 1.2900. GBP/USD weakened as the dollar extended its rally on expectations that the Federal Reserve is unlikely to cut rates soon. The US dollar index broke through the key resistance level of 104.00 with strength. But market sentiment remained subdued, with US stocks posting losses, while the dollar remained in favor. Last Thursday, the Bank of England kept interest rates unchanged and said there was uncertainty ahead, echoing the words of Fed Chairman Jerome Powell. Traders are looking at April 2 as a key date for the implementation of reciprocal tariffs from the United States. Most analysts estimate that the trade war could lead to a global economic slowdown.

GBP/USD will end the week in almost flat territory, but has been rising steadily since breaking through the 1.2900 mark. However, the pair had two bearish days late last week, hitting a ten-day low of 1.2887. In the short term, momentum favors sellers, and the 14-day relative strength index (RSI) on the daily chart, although in the bullish zone (latest around 61,00), may be in a downward trend in the short term. This opens the door for a correction, and traders may pull GBP/USD back to challenge the March 10 low of 1.2861. If it is broken, the next target is the 200-day moving average of 1.2797. On the other hand, the upward trend may resume as the 20-day (1.2845) and 200-day (1.2797) moving averages form a bullish "golden cross" pattern. First, it rose near 1.2972 (last Friday's high) and 1.3000, the psychological market level, indicating that the overall trend is bullish. If it breaks, it will further point to 1.3048 (the high of November 6 last year), and continue to challenge the 1.3118 (the 76.4% Fibonacci rebound from 1.3434 to 1.2099).

Today, it is recommended to go long on GBP before 1.2910, stop loss: 1.2900, target: 1.2955, 1.2965

USD/JPY

USD/JPY fell as the US Federal Reserve supported a restrictive policy stance and the dollar rose. US President Trump's tariff policy is expected to boost US inflation and drag down economic growth. Japan's national CPI fell in February. In the middle of last week, the Bank of Japan decided to keep the current interest rate unchanged on Wednesday, in line with economists' general expectations. USD/JPY rebounded to a two-week high of 150.02 after Kazuo Ueda's speech, but then fell back to around 149. Subsequently, the Fed kept its policy unchanged for the second time in a row, but also hinted that there may be two more 25 basis point rate cuts before the end of this year. The market is currently generally expecting that the Fed may restart the rate cut cycle as early as the June meeting, which has put pressure on the US dollar index. On the other hand, in Japan, the Governor of the Bank of Japan emphasized after the meeting that if inflation continues to rise and leads to further wage increases, it is not ruled out to gradually increase the policy rate to maintain the long-term credibility of the inflation target. The resulting narrowing of interest rate spreads (expected), coupled with the safe-haven demand caused by the intensification of geopolitical risks, have provided additional support for the yen. On the other hand, before the weekend, the good recovery in demand for the US dollar also helped the USD/JPY maintain intraday gains above the mid-149.00 level as the Fed predicted only two 25 basis point rate cuts before the end of this year.

From the daily chart, the current USD/JPY exchange rate is hovering around 149.50, with the last round of lows of 146.54 (March 11) and the recent high of 150.16 last Wednesday forming short-term support and resistance. The 14-day relative strength index (RSI) of the technical indicator is currently around 47.30, indicating that the exchange rate is still in a weak range overall. If the price falls below 148.48 (14-day moving average) and 148.20 (last week's low) in the future, it may trigger further short selling, and the market may test the downside space around 147.41 (March 13 low) again. And further downward challenge 147.00 (round mark), and 146.54 (low since October last year). On the contrary, if USD/JPY steadily stands above 149.50-149..60 and breaks through the same range with large volume, it is expected to open the upward channel. It will help USD/JPY to recapture the psychological mark of 150.00. If there is some follow-up buying above the 150.15 (last week's high) area, it may trigger a short-term covering rebound and push the currency pair to the 40-day moving average resistance level of 150.83, and then point to the 151.00 mark and the monthly high in the 151.30 area.

Today, it is recommended to short the US dollar before 149.50, stop loss: 149.70; target: 148.50, 148.30

EUR/USD

The EUR/USD trend last week showed a "first rise and then give up" pattern, and once fell below 1.0800. The market continues to put one foot on the safe-haven US dollar amid the vacillation of the US tariff policy. Federal Reserve Chairman Jerome Powell downplayed the economic risks posed by US President Trump's tariff threats, which seemed to be in a quantum state, both existing and non-existent. According to Powell, the downside risks have indeed increased due to the occasional tariff threats, but Fed policymakers still insist that US economic data remains healthy, although it has fallen from recent highs. On the other hand, European Central Bank President Christine Lagarde maintained a strictly neutral tone in her speech to the European Parliament last week. At a time when the uncertainty of the impact of tariffs is intertwined with the uncertainty of the impact of fiscal stimulus, it is indeed difficult to ask for anything different from strict data dependence. In other words, don’t expect any ECB guidance until the data sets a direction for the euro. For now, the retracement of the EUR/USD rally is in line with market expectations, although perhaps a little earlier than expected. Again, the risk of noise is high, but the bias remains bearish on the pair in terms of multi-week direction.

Technical analysis on the daily chart suggests that EUR/USD has seen increased selling pressure recently and a trend reversal is likely as the pair has broken below an ascending channel pattern. In addition, EUR/USD has fallen below its 9-day moving average (1.0885), which suggests weakening short-term price momentum. However, the 14-day relative strength index (RSI), a key momentum indicator, remains above 58, suggesting that the bullish outlook remains intact. A sustained decline would confirm a shift in the bearish outlook. On the upside this week, EUR/USD could retest the near-term support of the 9-day moving average at 1.0885. A break above this level could strengthen short-term price momentum and allow the pair to re-enter the market’s psychological barrier of 1.0900. This could restore the bullish bias and could push the pair towards the March 18 high of 1.0955. On the downside, EUR/USD could target the 1.0800 round number level. A break below this support level could weaken medium-term exchange rate momentum and could extend the decline to the 1.0728 (20-day moving average) and 1.0727 (38.2% Fibonacci retracement of 1.0360 to 1.0955) support areas. And further test the 1.0657 (50.0% Fibonacci retracement) level.

Today, it is recommended to go long on the euro before 1.0802, stop loss: 1.0790, target: 1.0850, 1.0860.

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