US Dollar Index

The US dollar index remained volatile around 100.00 last week after stronger-than-expected U.S. nonfarm payrolls data. But the dollar was pressured by dovish interpretations and trade headlines related to China. The dollar index pared losses on Friday, trading near 100 and on track for a second straight week of gains after the U.S. Bureau of Labor Statistics reported that nonfarm payrolls increased by 177,000 in April, beating expectations of 130,000 but below a revised 185,000 in March. The unemployment rate remained at 4.2%, while the labor force participation rate rose slightly to 62.6% from 62.5% in March. The latest jobs report showed a cooling but still resilient labor market. The report was above expectations and provided the first look at employment conditions since President Donald Trump announced massive tariffs. The bond market has already reflected concerns that these trade policies could slow the economy, increasing pressure on the Federal Reserve to cut interest rates. Traders continue to expect the Fed to cut interest rates nearly four times this year. Market sentiment was also boosted by news that China is considering restarting trade talks with the United States. Chinese officials reiterated that the United States must show sincerity and cancel all unilateral tariffs, saying that if the United States wants to negotiate, it should correct its wrong practices and cancel unilateral tariffs.

On the daily chart, technical analysis shows that the US dollar index once broke through the upper line of the "downward channel" at 100.15 to a weekly high of 100.33. In addition, the index also rose above the 9-day simple moving average of 99.52, indicating that short-term momentum may be strengthening. However, the 14-day relative strength index (RSI) of the technical indicator is still below 50 {latest at around 43.75}, indicating that the bearish bias is still in play. A break above the 50 level may confirm the emergence of a bullish bias. On the upside, once the US dollar index rises above 100.15{upper line of the downward channel}, and 100.33{last week's high}, it may target the 100.72{23.6% Fibonacci rebound level from 109.80 to 97.91} level. A break above this level may improve medium-term price momentum and support the index to explore the area around 101.01, the high reached on April 11, and the 101.00 round mark. On the downside, the immediate support level is 99.50, the 9-day simple moving average. Once the 9-day simple moving average of 99.50 is broken, the bearish bias may be strengthened to the 99.00{round mark}, and 98.90{last week's low} area level.

Consider shorting the dollar index around 100.15 today, stop loss: 100.30, target: 99.70, 99.60

WTI spot crude oil

WTI crude oil fell 7.65% last week to close at $58.15 a barrel, marking the biggest weekly drop since late March. The decline came as traders turned cautious ahead of a key OPEC+ meeting rescheduled on Saturday, where members will discuss production targets for June. The group, which includes OPEC and its allies, is weighing whether to accelerate production increases or stick to a more moderate approach as demand growth expectations weaken. Concerns about a global economic slowdown related to the US-China trade war further pressured the oil market. Despite signs of easing trade tensions, sentiment remains fragile. The number of US oil rigs fell by four to 479, providing slight support to slowing domestic production growth. On top of that, US President Trump's threat to impose secondary sanctions on any country that buys Iranian oil added some geopolitical risks to the mix. Becoming a key factor supporting the black liquid. In addition, the mild decline of the US dollar from multi-week highs further supported crude oil prices, although expectations of more OPEC+ supply entering the market limited the upside.

From the daily chart of WTI crude oil, oil prices once tested a three-week low of $56.12 last week, and rebounded to around $58.83 before the weekend {23.6% Fibonacci rebound level from 71.98 to 54.78}, and then stabilized before retracing to $58.00, and temporarily stopped the downward trend. The current pattern shows that the technical rebound is still continuing. If the price breaks through the $60.00 {market psychological barrier} resistance range, it is expected to further test the $61.35 line {38.2% Fibonacci rebound level}, and the $61.34 {21-day simple moving average} area. A break further points to the $63.38 {50.0% Fibonacci rebound level} level. The 14-day relative strength index (RSI) of the technical indicator of the daily chart is in the negative zone {latest at 35.45}, and the MACD indicator is slightly up, indicating that the market is temporarily in a correction phase. Therefore, the latest first support level below is still concerned about $56.12 {last Thursday's low}. If it breaks, it will move towards the low of $54.78 in more than 4 years.

Today, you can consider going long on crude oil around 58.00, stop loss: 57.80; target: 60.0; 60.20

Spot gold

Last week, gold traded at around $3,240 an ounce, heading for its worst week in two months, and plummeted more than 8.5% in two weeks {3500 fell to 3202}, as signs of easing trade tensions weakened demand for safe-haven assets. China said it was considering the possibility of launching trade negotiations with the United States, raising hopes of easing tensions between the two countries. Earlier, President Trump said there was a "very good chance" of reaching an agreement with China. Meanwhile, investors chose to take profits before the weekend as the latest data showed that the US economy shrank in the first quarter, while the personal consumption expenditures (PCE) price index remained stable in March, and a strong US labor market report improved risk appetite. Gold fell to around $3,202 last week, close to a three-week low, and is set for a second consecutive weekly decline as signs of easing trade tensions curbed demand for safe-haven assets. In addition, some repositioning trades provided a tailwind for non-yielding gold. Therefore, it would be wise to wait for strong follow-up buying before confirming that the correction from the psychological level of 3,500 or the all-time high is over.

From a technical perspective, spot gold fell to a three-week low of $3,202 last week, barely holding above the 25-day simple moving average and the market psychological level of $3.200, and rebounded in a "V" shape before the weekend. The 14-day relative strength index (RSI), a technical indicator on the daily chart, has lost positive momentum but has not yet confirmed the negative outlook {latest at 52.93}. This in turn prompted some short-term covering trades and provided a tailwind for gold prices. Nevertheless, the above support breakout point, located in the $3,260-3,265 area, may limit further gains, and if it breaks through this level, gold prices may recapture the $3,292.50 {38.2% Fibonacci retracement level of 2956.80 to 3,500.10}, and the $3,300 mark. The latter should act as a key psychological pivot point, which if broken, may push gold prices to the $3,319.10 {10-day simple moving average, and $3,371.80 {23.6% Fibonacci retracement level} resistance areas. Subsequent buying will indicate that the corrective pullback from the all-time highs is over, with the ultimate target being the $3,400 level. On the other hand, the $3,228.50 {50.0% Fibonacci retracement} area now seems to be holding back the upcoming downside risk ahead of the $3,202-3,200 mark area of ​​last week’s low. A break below the latter would reaffirm the short-term bearish bias and expose gold prices to an accelerated decline towards the $3,164.30 level {61.8% Fibonacci retracement}.

Consider going long on gold before $3,235 today, stop loss: $3,230; target: $3,260; $3,265

AUD/USD

AUD/USD rose strongly to near a five-month high of $0.6470 before the end of last week on the back of a weaker US dollar. The Australian dollar benefited from the improving sentiment around US-China trade talks and a strong but slowing US jobs report after a disappointing false breakout of the US dollar index at the 100.00 level. Hopes for a resolution to the trade dispute between the two largest economies provided a tailwind for the Australian dollar despite market caution. The Australian dollar gained for the fourth straight week against the U.S. dollar last week as positive outlook for U.S.-China trade talks boosted global sentiment. China announced that it was reviewing the prospects for trade talks following repeated attempts by U.S. officials to reach out. However, the AUD/USD pair remained vulnerable, with falling metal prices weighing on sentiment. Key commodities such as iron ore, copper and gold fell on concerns about a global economic slowdown, putting pressure on the commodity-linked Australian dollar. The upside for the AUD/USD pair could be limited as signs of easing trade tensions with the United States support the U.S. dollar. Australia held an election last weekend, and the results pose multiple risks to the Australian dollar. Another short-term risk is that the results could be delayed, with no clear result emerging within a few days after the vote. Meanwhile, inflationary pressures in Australia in early 2025 have dampened market expectations for further monetary easing by the Reserve Bank of Australia.

From the daily chart, AUD/USD continued to trade in the 0.6470 to 0.6350 range last week, but maintained a bullish bias. The pair continues to hold above the 10-day simple moving average of 0.6399, and 0.6400 (round numbers), while the 14-day relative strength index (RSI) is also comfortably around 59.68, both indicating continued upward momentum. For now, AUD/USD may find immediate resistance at the four-month high of 0.6449, set on April 29, and 0.6458 (200-day simple moving average). A break above this level could pave the way for a five-month high of 0.6515, and 0.6500 (market psychological barrier). On the downside, initial support is seen at the 10-day simple moving average of 0.6399, and 0.6400 (round numbers), followed by 0.6338 (23.6% Fibonacci retracement of 0.5914 to 0.6470), and 0.6300 (market psychological barrier). A break below these levels could weaken the bullish outlook.

Today's recommendation is to go long AUD until 0.6430, stop loss: 0.6415, target: 0.6470, 0.6480

GBP/USD

The pound has continued to fall over the past four days, despite an upbeat U.S. jobs report that reduced fears of a recession in the largest economy. Positive trade news has improved risk appetite as easing U.S.-China tensions weigh on the dollar. The pound fell to around $1.3273 last week, but remains close to its highest level since February 2022, benefiting from a generally weaker U.S. dollar. The pound rose 3.2% in April, its strongest monthly performance since November 2023. The UK is seen as relatively immune to U.S. tariffs, which President Trump has suspended until July. The U.S. goods trade surplus with the UK reached $12 billion in 2024, in stark contrast to deficits with China and the EU, limiting the damage that trade tensions could cause. The pound is also supported by expectations that the Bank of England will be more cautious than other central banks in cutting interest rates, with markets expecting about 85 basis points of rate cuts this year, similar to the Federal Reserve. Investors are now looking to upcoming key U.S. data, including employment and inflation, for clues on the direction of the dollar. Meanwhile, reports that the U.S. may ease tariffs eased some concerns, although broader trade risks with China remain.

The daily chart shows that GBP/USD retreated from a three-year high of 1.3445 at the beginning of last week. It closed near the all-week low of 1.3273. However, the overall outlook for the currency pair remains bullish as all short- to long-term simple moving averages are trending upwards. The 14-day relative strength index (RSI) of the technical indicator remains in the positive zone around 56.67. If the RSI can continue to fluctuate in the positive zone, it will trigger new bullish momentum. On the upside, the pair must break through the May 1 high of 1.3345 to confirm the pattern, and the bulls may push the spot price to 1.3400. A break above the latter would expose the year-to-date high of 1.3445. On the contrary, GBP/USD closed at the weekend to form a "shooting star" top-down bearish pattern. If the currency pair falls below 1.3263 {last week's low}, the key support level will be exposed. The first support level will be 1.3200 {round mark}, and 1.319 {20-day simple moving average} area, followed by 1.3164 {April 15 low} and 1.3163 {23.6% Fibonacci retracement level from 1.2708 to 1.3445}, and finally the 1.3100 round mark level.

Today, we recommend going long on GBP before 1.3260, stop loss: 1.3248, target: 1.3320, 1.3330

USD/JPY

The yen was trading near 145 against the dollar before the weekend, having earlier fallen to a three-week low of 145.92 as safe-haven demand waned amid progress in US-China trade relations. China said it was considering the possibility of trade talks after repeated US efforts to push for tariffs. Meanwhile, Japan and the US concluded their second round of bilateral trade talks last week, with Tokyo hoping to reach a deal by June. On the domestic front, Japan's unemployment rate edged up to 2.5% in March, but the labor market remains relatively tight. It was also reported that the Bank of Japan on Thursday kept its policy rate unchanged at 0.5% and cut its growth and inflation forecasts, suggesting a lower likelihood of a rate hike in the near term. On the other hand, any meaningful yen appreciation seems limited given the Bank of Japan's dovish pause last Thursday. Indeed, the Bank of Japan cut its forecasts for current year economic growth and inflation amid heightened trade uncertainty, forcing investors to scale back bets on further rate hikes.

From a technical perspective, USD/JPY last week broke above 144.21 {38.2% Fibonacci retracement level from 151.21 to 139.89} and 144.36 {24-day simple moving average} to a near three-week high of 145.92, which is seen as a key trigger for bullish traders. The 14-day relative strength index (RSI) on the daily chart has risen into positive territory near above 50.00, suggesting that the bullish bias may continue this week. This suggests that the path of least resistance for USD/JPY is upward and must close above the key resistance level of 145.55 {50.0% Fibonacci retracement level} in order to extend above 145.92 {last week's high}, and the 146.00 round number. Therefore, it would be wise to wait for some follow-up buying before the 145.92-146.00 level breaks out in order to set up for a continuation of the recent good rebound from multi-month lows. Spot prices may climb to the intermediate resistance of 146.55-146.60 before testing the 61.8% Fibonacci rebound level, around 146.89. On the other hand, the 144.21-144.36 area may provide immediate support before the 145.00 round mark. A break below the former may trigger some technical selling and drag USD/JPY below 143.63 (20-day simple moving average) and then move below 143.00 {round mark}.

Today, it is recommended to short the US dollar before 145.20, stop loss: 145.45; target: 144.10, 144.00.

EUR/USD

The euro held near $1.13 as investors digested stronger-than-expected eurozone inflation data and a solid U.S. nonfarm payrolls report. Eurozone inflation remained at 2.2% in April, slightly above expectations of 2.1%. Services inflation accelerated to 3.9%, while core inflation, which excludes food and energy, rose to 2.7%, also exceeding expectations, prompting investors to maintain their expectations of a 60 basis point rate cut by the European Central Bank this year. In the United States, nonfarm payrolls increased by 177,000 in April, beating market expectations of 130,000, despite rising uncertainty related to President Trump's tariff policy. The strong jobs data, combined with Wednesday's weak GDP report, could complicate the Federal Reserve's decision on whether to cut interest rates in June. In theory, the upbeat job growth data reinforces the Fed's case for maintaining a rate cut in the short term despite heightened economic uncertainty due to the impact of President Trump's tariffs. The upbeat nonfarm payrolls also forced traders to pare back bets on a rate cut at the Fed’s June meeting. Meanwhile, sentiment improved as signs of easing trade tensions between the U.S. and China emerged, with Beijing saying it was “evaluating” a recent U.S. proposal to restart talks.

EUR/USD ended last week lower for the third straight week, trading around 1.1300 as buyers remain in control in the broader trend. Despite the gains, underlying momentum remains uncertain, with short-term indicators sending mixed signals. However, the broader technical structure remains positive, with solid positioning across the major moving averages continuing to trend upwards. From a technical perspective, the pair has an overall bullish bias. The 14-day relative strength index, a technical indicator on the daily chart, hovers around 55.43, still neutral but trending upwards. The moving average convergence/divergence indicator has turned negative, suggesting weakening intraday strength. The moving averages provide trend confirmation. 20-day, Both the 50-day and 100-day simple moving averages are below the current price and sloping upwards, reinforcing the broader bullish structure. These levels continue to provide strong dynamic support, while resistance is now starting to build above the current trading area. Therefore, this week's support levels are 1.1223{last Thursday's low}, 1.1200{round mark}, and 1.1133{30-day simple moving average}. On the upside, immediate resistance is located at 1.1355{10-day simple moving average}, and a break above this area may open the door to further gains to 1.1400{round mark}, and 1.1473{April 11 high} area.

Today, it is recommended to go long on the euro before 1.1285, stop loss: 1.1270 target: 1.1350, 1.1360.

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