US Dollar Index

The US dollar index rebounded above the 100 mark on Thursday, extending the previous day's upward momentum to a high of 100.76, as signs of progress in negotiations between the United States and major trading partners showed that the White House was in no hurry to advance its reciprocal tariff plan. The United States and the United Kingdom are expected to announce a trade agreement later this week that could serve as a template for future agreements with other major economic partners, ahead of key negotiations with China. Meanwhile, the Federal Reserve kept interest rates unchanged, but Chairman Powell pointed to heightened risks to inflation and unemployment. He also rejected the idea of ​​a precautionary rate cut to offset the potential economic impact of President Trump's proposed tariffs. Among the major currencies in the currency basket, the dollar underperformed against the Swedish krona after the Swedish Central Bank kept interest rates unchanged.

From the technical perspective of the daily chart, the US dollar index once rose above the psychological level of 100.00 on Thursday, reaching a high of 100.76, the highest point since February; the 14-day relative strength index (RSI) of the technical indicator was at 50.27, in a neutral and weak area, showing no signs of oversold. The index has shown a clear downward trend since the beginning of this year, falling from the high of 110.18 at the beginning of the year to the current 99 area. Although the current price is near the psychological level of 100 above the market, it still shows that the short-selling pressure is relatively large. However, the MACD display value is 0.3974, and the bar chart has turned from negative to positive, indicating that short-term momentum is improving. Therefore, if it breaks through the resistance of 100.21{Thursday high}, it will open up to the 100.75{30-day simple moving average} level, or even the 101.00{integer level} area; if it fails to stand above the 100 market psychological level, it is not ruled out that the US dollar index will fall back to the range around 99.60{Thursday low} and 99.23{Wednesday low}.

Today, you can consider shorting the US dollar index around 100.70, stop loss: 100.82, target: 100.30, 100.20

WTI spot crude oil

WTI crude oil rose nearly 4.0% on Thursday to close at $59.95 a barrel, boosted by hopes of progress in the upcoming trade talks between the United States and China, the two countries are key players in global oil demand. Optimism stems from news that US Treasury Secretary Scott Bessant will meet with China's top economic officials in Switzerland on May 10 to negotiate an end to the trade conflict. Long-standing US-China trade tensions have raised concerns about reduced global crude oil consumption, but signs of diplomatic engagement have helped ease market panic. At the same time, the announcement of the US-UK trade agreement has also enhanced positive sentiment. On the supply side, OPEC+ plans to increase production, which may limit further price increases. In addition, the oil market remains sensitive to geopolitical developments, including the potential impact of the US-Iran nuclear agreement on supply levels.

The current trend of international crude oil prices is entering a sensitive period of multiple factors. The uncertainty of trade negotiations and Iran's supply potential constitute dual pressures, and short-term oil price fluctuations will be more dominated by geopolitical and inventory dynamics. From a technical perspective, the daily chart shows that US WTI crude oil has fallen for three consecutive trading days, and the 14-day relative strength index (RSI) of the technical indicator has fallen to a neutral and weak area, and the MACD indicator also shows that the downward momentum has increased. Overall, unless there is a significant positive fundamentals, oil prices may maintain a volatile downward pattern in the short term. At present, it has fallen below the market psychological support of $60.00, and the short-term technical pattern is weak. The current price has failed to stabilize above $58 and may further fall to $57.00 {round mark}, and $56.79 {Tuesday low} support. On the upside, $60 becomes a key psychological turning point. Crude oil must decisively break through the resistance near $60 to $60.52 {20-day simple moving average}, and $61.80 {April 2 high} to change market sentiment.

Today, consider going long on crude oil near 59.75, stop loss: 59.55; target: 61.00; 61.30

Spot gold

Gold continued its recent decline on Thursday, falling to around $3,288 per ounce before rebounding slightly to around $3,305, as cautious views on the outlook for U.S. interest rates dampened the appeal of this interest-free asset. The Federal Reserve kept its benchmark interest rate unchanged as expected and warned of rising inflation and unemployment risks, reinforcing its cautious stance on future interest rate changes. Fed Chairman Powell also said the central bank is not considering taking precautionary interest rate cuts to counter the possible economic consequences of tariffs. Meanwhile, uncertainty surrounding the US-China trade talks helped limit further losses. President Trump said he would not consider reducing the US's 145% tariffs on China to advance negotiations with Beijing, dampening hopes for a breakthrough ahead of a planned meeting between US and Chinese officials in Switzerland.

From a technical perspective, fresh buying around the $3,400 resistance-turned-support level and the subsequent rise are bullish for gold/dollar bulls. Moreover, oscillators on the daily chart remain comfortably in positive territory, suggesting that the path of least resistance for gold prices remains to the upside. Some follow-through buying above the $3,400 area or the weekly high of $3,439.70 would reaffirm the positive bias and allow the commodity to retest all-time highs and attempt to conquer the psychological $3,500 mark. On the other hand, $3,300 {round mark} is the first strong support area. A clear break below the above area would negate the positive outlook in the near term and prompt some technical selling. The downward trajectory could drag gold prices to the intermediate support of $3,265-3,260, and then to the $3,223-3,222 area and last week's low, around $3,200.

Consider going long on gold before $3,300 today, stop loss: 3,295; target: 3,330; 3,340

AUD/USD

AUD/USD edged higher in Thursday's Asian session, trading around $0.6450 before pulling back to $0.6400 after falling more than 1% in the previous session. The pair hit a five-month high of $0.6514 on Wednesday but retreated on the Fed's cautious policy outlook. Although tariffs during the Trump administration have dampened consumer and business confidence, the lack of significantly weak economic data has made it more difficult for the Fed to justify recent policy changes. It also pointed to increased risks on inflation and employment. This cautious outlook, coupled with the Fed's continued reduction of its balance sheet, has reinforced the strength of the US dollar, putting pressure on AUD/USD. Despite the pullback, the Australian dollar is still supported by optimism about a possible breakthrough in US-China trade relations, given Australia's significant trade relationship with China. Further boosting market sentiment, the People's Bank of China announced plans to cut key lending rates and reduce banks' reserve requirements to stimulate economic growth.

AUD/USD sent bullish signals, breaking through 0.6500 to a nearly six-month high to 0.6515 mid-week, before retreating to around 0.6400. The 14-day relative strength index (RSI) of the daily chart's technical indicators is around 53.20, indicating neutral momentum. The moving average convergence/divergence (MACD) indicates a buy signal, and the commodity channel index (CCI) reading of 124.18 also suggests a bullish bias. The average directional index (ADX) is 21.07, which is neutral, indicating a balanced market. The key moving averages further reinforce the bullish outlook. The support levels are respectively at 0.6400, and the break points to the integer level of 0.6375{May 2 low}, and 0.6330{25-day simple moving average}. The resistance level is 0.6475{220-day simple moving average}. The second is 0.6500{market psychological barrier}, and the 0.6528 area level of the high point on November 29, 2024, providing a solid foundation for further gains.

Today, it is recommended to go long on the Australian dollar before 0.6400, stop loss: 0.6382, target: 0.6450, 0.6460

GBP/USD

BoE Governor Andrew Bailey explained the decision to cut the policy rate to 4.25% after the May meeting and answered questions at the press conference after the meeting. However, the decision showed significant divisions within the MPC: five members voted for a 25bps cut, two for a 50bps cut (Dingla and Taylor), while two voted to keep rates unchanged (Man and Peel). GBP/USD rebounded from recent losses and traded around 1.3250 in Thursday's EUR/USD session. The dollar gained in the previous session. However, the US dollar index could regain momentum on the Fed's cautious outlook. Midweek, the Fed kept interest rates unchanged at 4.25%-4.50%, but pointed to rising inflation and unemployment risks, adding uncertainty to the economic outlook.

GBP/USD's rebound showed fatigue around the main resistance of 1.3445 {year-to-date high}–1.3500 {round mark}, with momentum fading, and the key support of 21-day simple moving average of 1.3257 is now under close watch. The technical indicator MACD on the daily chart has fallen below its trigger line, showing a weakening upward momentum. After this test, a short pause is forming. The recent 1.3201{25-day simple moving average}, and the support low of 1.3200{round mark} may be an important support area. If it falls below this level, GBP/USD may start a deeper downward trend towards 1.3100{round mark}. In addition, an upward breakthrough of 1.3300{round mark}, and 1.3356{Thursday's high) will confirm a larger upward trend to 1.3400{round mark}, and 1.3445{this year's high} area.

Today, it is recommended to go long on GBP before 1.3230, stop loss: 1.3220, target: 1.3300, 1.3310

USD/JPY

The USD/JPY currency pair has risen sharply to a near one-month high of 146.20 as the US dollar strengthened after the Federal Reserve decided to keep interest rates unchanged, while optimism about US-UK trade relations has also been boosted. US President Donald Trump highlighted what he called a "significant breakthrough" in trade relations with the UK, lifting sentiment. However, caution remains as details on the deal suggest that the 10% tariff on UK goods will remain in place, potentially dampening initial enthusiasm. The US dollar index broke through the key 100.00 mark, supported by strong economic data and the Federal Reserve's steady policy stance. Initial jobless claims fell to 228K in the week ending May 3, down from 241K in the previous week, showing continued strength in the US labor market. The minutes of the Bank of Japan's March meeting showed a cautious outlook, with policymakers expressing concerns about the impact of US tariffs on Japan's export-oriented economy. This divergence in central bank policy has given the US dollar an advantage over the Japanese yen.

From a technical perspective, the intraday failure of USD/JPY near the 146.00 mark supports the pair against the backdrop of a still negative oscillation on the daily chart, especially last week's rejection near the 200-hour simple moving average on the 4-hour chart. A break below the immediate support at 145.00 would further confirm the bearish outlook and drag the spot price below 144.00, back to the lows in the 143.55 area. Next up is the 143.00 round mark, while on the other hand, the 146.00 mark could continue to act as an immediate barrier before the 146.50-146.60 supply range. A sustained strong break above the latter could trigger a short-term covering rally, allowing USD/JPY to recapture the 147.00 psychological mark.

Today's recommendation to short the dollar before 146.10, stop loss: 146.30; target: 145.00, 144.80

EUR/USD

The EUR/USD pair slipped to trade just below the 1.1250 mark on Thursday. The election of Friedrich Metz as German Chancellor reduced uncertainty about the eurozone's economic powerhouse and provided some support for the common currency. On the other hand, the dollar struggled to gain any meaningful momentum despite the Fed's hawkish pause on Wednesday, which also became another support factor for EUR/USD. At the same time, investors remained nervous amid Trump's rapidly changing trade policy stance. In addition, the EU was reported to propose tariffs on Boeing aircraft if negotiations with the United States failed, increasing the risk of further escalation of the trade conflict. This in turn prevented traders from making aggressive directional bets on EUR/USD, resulting in sluggish price action.

Despite the dovish signals from the ECB, position data showed that market participants still favored the euro. Technical indicators on the daily chart point to further upside. The 14-day relative strength index (RSI) remained high near 50.88, while the average directional index (ADX) was close to 46, indicating that a strong underlying trend is still in play. The first resistance for EUR/USD is 1.1336 {Thursday's high}, and the next level is pressure near 1.140 (round mark}. On the contrary, the support level is first 1.1200 {round mark}. Once it falls below the above support area, it will directly point to the 1.1148 {34-day moving average} level.

Today, it is recommended to go long on Euro before 1.1210, stop loss: 1.1200, target: 1.1260, 1.1270.

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