A Short-term Tug-of-War Is Expected, with Mid-term Bullish Outlook

Commodity

Summary:

The current market for gold is characterized by a tug-of-war between bulls and bears, although several factors continue to support a bullish outlook.

BUY XAUUSD

Close Time

CLOSED

3313.42

Entry Price

3525.00

3250.00

4215.37 +17.46 +0.42%

634.2

Pips

Loss

3250.00

3245.68

Exit Price

3313.42

Entry Price

3525.00

Fundamentals

The current gold market is at a critical juncture, characterized by a tug-of-war between bulls and bears. Fundamental factors are intertwined with short-term correction pressures and long-term structural support. Although geopolitical risks have somewhat subsided, the potential for underlying conflicts continues to inject a risk-aversion premium into gold prices. The Russia-Ukraine situation, against the backdrop of a 72-hour temporary ceasefire declared by Putin during the Victory Day celebrations, appears relatively stable. However, the intensity of military confrontations between the two sides has not diminished, and increased battlefield engagement suggests that the implementation of a ceasefire agreement remains uncertain. The Middle East situation also exhibits a "cooling and heating" pattern. While the U.S.-Iran nuclear talks may resume on May 3, Iran's strategy of prior consultation with Europe indicates the complexity of the negotiation process. Furthermore, the fluctuating progress of the hostage agreement between Israel and Hamas suggests that geopolitical "black swan" risks have not been entirely eliminated.

Furthermore, the interplay of trade policies has emerged as a novel variable impacting market dynamics. The Trump administration, on one hand, has signaled a firm stance with potential tariff adjustments, while simultaneously, through Treasury Secretary Bessent, has offered expectations of a preliminary trade agreement within the coming weeks. This policy oscillation has amplified market concerns regarding the stability of global supply chains.

In addition, it is noteworthy that market speculation suggests a partial waiver of tariffs on U.S. goods by China. Although this news provided temporary relief, the imposition of tariffs by the U.S. on emerging markets such as India, coupled with political pressure from German Chancellor-designate Merz to eliminate all tariffs, indicates that the specter of protectionism persists. Consequently, the value of gold as a hedge against policy risks continues to be emphasized.

Technical Analysis

A Short-term Tug-of-War Is Expected, with Mid-term Bullish Outlook_1

In the 1D timeframe, despite the recent deep correction from the historical high of 3500 to 3260, a decline exceeding US$200, the overall trend for gold remains bullish. The alignment of the SMAs further corroborates a bullish outlook for gold's mid-to-long-term trajectory.

A Short-term Tug-of-War Is Expected, with Mid-term Bullish Outlook_2

In the 4H timeframe, gold has tested the 3260 support level three times during the previous correction, without a definitive breach, indicating a robust short-term support level at this juncture.

Currently, gold is exhibiting a range-bound fluctuation between 3260 and 3370 in the short term. On the upside, a decisive breach of the 3370 resistance level would likely initiate further upward movement, with the initial target being a retest of the historical high at 3500. Conversely, a breach below the 3260 support level could trigger a downward movement, potentially leading to a test of the 3240 support level, or even a decline to 3160.

Trading Recommendations

Trading Direction: Buy

Entry Price: 3315.00

Target Price: 3525.00

Stop Loss: 3250.00

Valid Until: May 1, 2025 23:00:00

Support: 3305.07, 3260.00

Resistance: 3370.00, 3500.00

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

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Manuel

Central Bank

Economic

Summary:

These moving averages have repeatedly acted as a dynamic resistance zone, reinforcing downward momentum whenever the price approaches them.

SELL EURCHF

Close Time

CLOSED

0.93840

Entry Price

0.92600

0.94600

0.93674 +0.00012 +0.01%

29.6

Pips

Profit

0.92600

0.93544

Exit Price

0.93840

Entry Price

0.94600

Concerns about inflation appear to have largely faded for now, and tomorrow’s release of the ECB’s Survey of Inflation Expectations at the one- and three-year horizons may further ease market nerves. Consensus anticipates a decline in both measures. However, the European Central Bank might also be growing uneasy with the euro’s strength. The trade-weighted nominal euro index has reached record highs, appreciating by about 4% year-over-year. In a world where global demand is fragmenting and shrinking, a strong currency is hardly ideal for an export-driven economy.

Markets are currently pricing in a 25-basis-point rate cut at the ECB’s next policy meeting on June 5, with a total of approximately 65 basis points of easing expected by the end of the year.

This week, the preliminary release of the Eurozone CPI, scheduled for Friday, is the main economic highlight. Meanwhile, the ECB speakers’ calendar is quite full. Recent comments from Governing Council members, including Knot and Villeroy, have been notably dovish, pointing toward disinflationary forces gaining momentum.

François Villeroy de Galhau, ECB policymaker and governor of the Banque de France, said on Monday that the central bank "still has room for rate cuts in Europe." He also emphasized that although the region is navigating through a period of significant economic uncertainty, there is no evidence of renewed inflationary pressures, nor does he anticipate a recession in France or the broader euro area. He added that U.S. protectionist policies, such as those promoted by Trump, seem to be failing.

Separately, ECB Chief Economist Philip Lane stated that while a 25-basis-point move is possible, it should not always be seen as the default. He refrained from committing to a specific path for interest rates. In addition, the ECB is reportedly considering adjustments to its monetary policy framework to allow more flexible responses to price shocks amid an increasingly volatile global environment. This topic will be discussed during an informal retreat in Portugal on May 6–7.

Last Thursday, ECB policymaker and Governor of the Bank of Finland, Olli Rehn, also highlighted downside risks to inflation, suggesting that current conditions could lead to medium-term inflation projections falling below the ECB’s 2% target.

Meanwhile, the Swiss franc’s recent strength against the euro has triggered speculation that the Swiss National Bank (SNB) might step in to intervene in the FX market or even reconsider its stance on negative interest rates. The sharp appreciation of the franc has fueled deflationary pressures in Switzerland, raising the prospect that the SNB may revisit the idea of reintroducing negative rates. However, the central bank is proceeding more cautiously now, mindful of avoiding political backlash, particularly from Washington. Bearish Setups Emerging Near Major Moving Averages_1

Bearish Setups Emerging Near Major Moving Averages_1

Technical Analysis

EUR/CHF staged an upward move after reaching a local low of 0.9224 on April 10, climbing until it encountered resistance near the 100- and 200-period moving averages, located at 0.9469 and 0.9416, respectively. These moving averages have repeatedly acted as a dynamic resistance zone, reinforcing downward momentum whenever the price approaches them. Adding to the confluence, the 0.50–0.618 Fibonacci retracement levels also align closely with the moving averages. If EUR/CHF fails to break through these barriers to the upside, it could trigger a fresh bearish wave targeting the 0.9259 area.

The RSI recently peaked near 60, not yet in overbought territory, but suggesting that the latest rally has been quite vigorous. The current price area around 0.9369 also marks a critical support zone. A strong break below this level could open the door to another leg lower.

Trading Recommendations

Trading direction: Sell

Entry price: 0.9384

Target price: 0.9260

Stop loss: 0.9460

Validity: May 08, 2025 15:00:00

Risk Warnings and Disclaimers

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Manuel

Forex

Economic

Summary:

If buyers reemerge around this zone, we could see a fresh bullish reversal, with potential for a move toward the 150.52 area

BUY USDJPY

Close Time

CLOSED

142.280

Entry Price

150.520

139.500

155.219 -0.126 -0.08%

69.0

Pips

Profit

139.500

142.970

Exit Price

142.280

Entry Price

150.520

Over the weekend, U.S. Treasury Secretary Scott Bessent stated that trade agreement negotiations with several Asian countries are actively underway. Additionally, U.S. Secretary of Agriculture Brooke Rollins commented that the Trump administration is engaging in “daily conversations” with China regarding tariffs.

However, China responded on Monday, clarifying that it is currently not involved in any active trade negotiations with the United States. Chinese officials reiterated their stance that no side wins in a tariff war and emphasized that discussions should be conducted on the basis of mutual respect.

On the data front, the University of Michigan’s consumer sentiment report, released last Friday, showed a slight improvement compared to the preliminary figures, likely reflecting the temporary pause in tariff escalations by President Trump. Nonetheless, the report highlighted ongoing weaknesses, with a notable deterioration in both current conditions and future expectations. Particularly concerning was the sharp rise in inflation expectations: the 1-year inflation outlook surged to 6.5% in April, up from 5.0% in March, and has nearly doubled since January. Policymakers are expected to take careful note of this trend, as it increasingly signals broad-based inflation fears rather than merely partisan divides.

Meanwhile, the optimism that U.S. trade policies could ultimately lead to a reduction in global tariffs appears to be fading. Analysts at Standard Chartered noted that multilateralism continues to erode under the Trump administration, with the World Trade Organization (WTO) sidelined and free trade agreements facing prolonged and uncertain negotiations. Adding to the downside risks, the persistence of trade uncertainty is increasingly seen as a threat to global growth prospects.

There are no scheduled Federal Reserve speakers this week, as the institution has entered its blackout period ahead of the Federal Open Market Committee (FOMC) meeting and rate decision set for May 7.

According to the CME FedWatch Tool, the probability of a rate cut at the upcoming May FOMC meeting stands at just 8.9%, with a 91.1% likelihood of no change. However, for the June meeting, market pricing suggests a roughly 61.9% chance of a rate cut, indicating growing expectations for policy easing as the year progresses.

Attention is also turning toward the Bank of Japan’s (BoJ) meeting this Friday, which carries notable significance. Although an immediate rate hike is not expected, stronger-than-anticipated inflation readings and broader disruptions to global trade could shape the BoJ’s future policy guidance. Expectations for a rate increase have now been pushed toward later in the year, with market participants eyeing a potential window between September and December. Buyers Could Step In to Defend Key Support Levels_1

Buyers Could Step In to Defend Key Support Levels_1

Technical Analysis

USD/JPY has extended its decline from the high of 144.05 reached on April 25, dropping to a session low of 141.98. The pair is now approaching key support at 141.74—a level that previously marked the beginning of a significant upward movement. If buyers reemerge around this zone, we could see a fresh bullish reversal, with potential for a move toward the 150.52 area. On the downside, the next major support lies at 139.64, a level not seen since July 2023, which could encourage buyers to step in as the pair tests a new multi-month low.

Meanwhile, the 100- and 200-period moving averages are positioned at 151.15 and 149.94, respectively, providing ample room for a recovery should bullish momentum build. These moving averages align closely with the 0.50–0.618 Fibonacci retracement zone, adding further confluence to the upside targets.

The RSI currently stands at 39, slightly tilted downward but still well above oversold territory. Should the 141.74 support fail to hold and a strong downside break occur, a further decline toward the 139.64 support could be on the horizon.

Trading Recommendations

Trading direction: Buy

Entry price: 142.12

Target price: 150.52

Stop loss: 139.50

Validity: May 08, 2025 15:00:00

Risk Warnings and Disclaimers

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Adam

Forex

Summary:

As of April 29, 2025, the AUD/JPY currency pair is trading around 91.74, down slightly from the intraday high of 92.05 and the low of 91.24. The market is in a consolidation mode, with investors awaiting clearer signals from Australian and Japanese economic data, as well as the Reserve Bank of Australia (RBA) interest rate decision next week....

BUY AUDJPY

Close Time

CLOSED

91.601

Entry Price

92.500

91.200

103.130 -0.038 -0.04%

40.1

Pips

Loss

91.200

91.198

Exit Price

91.601

Entry Price

92.500

Market Overview

AUD/JPY is currently trading in a narrow range, reflecting investor hesitation ahead of key economic events. The possibility that the RBA will keep interest rates higher for longer is weighing on the Australian dollar, while the Japanese yen is supported by safe-haven sentiment amid global economic uncertainty.

Market psychology

Market sentiment indicators show investors are cautious, with trading volumes slightly down and price volatility low. Investors are waiting for clearer signals from economic data and the RBA's interest rate decision to determine the next direction of this currency pair.

Technical analysis

AUD/JPY is currently trading in a narrow range, reflecting investor hesitation_1

Bollinger Bands (20,0,2): Price is hovering near the middle band of the Bollinger Bands, indicating that the market is in a consolidation state. Price moving above or below the upper/lower band may signal a new trend.

Ichimoku Kinko Hyo (9,26,52): The price is near the Kumo cloud, indicating an unclear trend. A price move above the cloud would be a positive signal, while a fall below the cloud could signal a downtrend.

Stochastic Oscillator (5,3,3): The Stochastic indicator is in the neutral zone, indicating that the market has no clear overbought or oversold signals.