US Dollar Index

The US dollar index traded above 103 on Monday, after rebounding on Friday. Market volatility increased as headlines emerged about the possibility of a temporary suspension of tariffs in the United States, although these were quickly denied by the White House. The US dollar index maintained moderate gains despite pressure on stocks and commodities. Technical signals remain mixed, with the MACD showing a buy signal, but key moving averages flashing bearish signals. The recent sharp decline in the US dollar index was mainly affected by the tariff policy announced by US President Trump last week, which strengthened the prospect of transatlantic trade frictions and further strengthened expectations of a slowdown in the US economy. The sharp decline in the US dollar also echoed the significant decline in US Treasury yields of various maturities. Given the high uncertainty brought about by policy changes and escalating trade tensions, the Federal Reserve Committee has chosen a cautious stance.

The technical pattern of the daily chart shows the medium-term trend of the US dollar index more clearly. The downward trend that began at the high of 110.18 at the beginning of this year has broken important structural support. The price is currently fluctuating between 101.27 (this year's low) and 103.68 (20-day simple moving average), forming a key support and resistance range. The MACD indicator of the technical indicator is running below the zero axis, but the difference (-0.6674) is narrowing, suggesting that the short-selling force may tend to weaken. The 14-day relative strength index (RSI) reading is 43.15, which is in the negative area, reflecting fragile bullish momentum. But it has not yet entered the oversold area. The CCI indicator fell to -104.8982, indicating that there is still a possibility of further decline in the short term. Therefore, the short-term key support level is 103.00 (market psychological level); 102.66 (opening price at the beginning of the week) level. The resistance level is in the 103.72 (20-day simple moving average), and 104.00 (integer level) area.

Today, you can consider going long on the US dollar index around 103.30, stop loss: 103.10, target: 103.70, 103.80

WTI spot crude oil

On Thursday (March 27), international oil prices rose slightly as market participants were evaluating the impact of tightening global crude oil supply and the latest US tariffs on the global economy and energy demand. On Monday, international crude oil prices fell nearly 2% to a four-year low of $58.78, due to concerns about a global recession caused by US President Trump's latest round of tariffs. Market concerns about the outlook for global energy demand have risen sharply. It then rose above $60.00. In the Asian session, both major crude oil benchmarks hit their lowest point since April 2021. Oil prices had already plummeted last Friday, and global trade tensions triggered a sharp decline in oil prices. According to market surveys, as the United States imposes additional import tariffs and major trading countries respond, investors generally expect that global trade frictions will lead to slower economic growth and oil consumption demand may slow down in the coming months. Investors are rapidly adjusting their demand for the crude oil market. The main driver of the expected price drop is the market's concern that tariffs will weaken the global economy. If the stock market continues to fall, WTI oil prices may fall to $55 or even $50.

The oil market is currently under the double pressure of supply and demand: trade concerns dominate the market, suppressing demand expectations, OPEC+ production increase plans weaken price support, investors' risk aversion heats up, and risky assets are sold off. In the short term, WTI oil prices have failed to return to $60.00, which may trigger a larger technical sell-off to $57.66 {April 2021 low} level. Oil prices will then face the test of the psychological barrier of $55.00. On the other hand, for a bullish outlook, WTI crude oil prices need to clearly break through the support line of 64.05 (the low since December 2021) before there is a turnaround. If oil prices rise instead of falling this week, the first target price can focus on $60.26 {last Friday's low}, and $60.00 {market psychological barrier} resistance. The next level will directly point to $61.65 (78.6% Fibonacci retracement level of 44.00 to 126.51). After breaking through, it will point to $63.47 {76.4% Fibonacci retracement level} level.

Today, you can consider going long on crude oil around 60.80, stop loss: 60.60; target: 62.20; 62.40

Spot gold

On Monday (April 7), spot gold fell nearly 2%, once approaching $2,956. After the US's comprehensive tariffs triggered concerns about a global recession, investors turned to the US dollar as a safe haven. However, given the grim economic situation, analysts are still optimistic about gold prices. Gold prices attracted some selling near the $3,055 support-turned-resistance level in early Asian trading and stalled in an intraday rebound from the $2,972-2,971 area, a near four-week low hit earlier this Monday. Investors continued to liquidate their bullish positions to cover losses from the widespread meltdown in global financial markets, which acted as a headwind for the precious metal. Nevertheless, the ongoing sell-off in the stock market, triggered by the broad reciprocal tariffs announced by U.S. President Donald Trump last week, provided some support for the safe-haven commodity. Meanwhile, data released earlier today indicated that the People's Bank of China increased the country's gold reserves for the fifth consecutive month.

From a technical perspective, last week's sharp pullback from the all-time high stalled ahead of the 61.8% Fibonacci retracement level of the strong February-April rally. However, the subsequent rise was blocked near the $3,055 level, which has now turned into resistance. The latter should now serve as a key pivot for day traders, and a break above it could see gold prices climb to the $3,080 region, and thus towards the $3,100 round-figure mark. On the other hand, the $2,972-2,971 area, the multi-week low hit earlier on Monday. Now appears to be protecting the upcoming downside, closely followed by the 50-day simple moving average, around the $2,943.50 area, which, if decisively broken, could shift the short-term bias in favor of bearish traders and pave the way for further depreciation.

Consider going long on gold before 2,980 today, Stop Loss: 2,975; Target: 3,005.00; 3.010.00

AUD/USD

AUD/USD remained under pressure during Monday's US session, holding around the 0.6000 area after a brief rebound in Asia. The pair extended Friday's deep losses as risk sentiment remained subdued amid ongoing tariff escalation between the United States and China. During the early Asian trading hours on Monday, the AUD/USD pair fell to around 0.5932 for the first time since the COVID-19 pandemic. The Australian dollar weakened as China imposed a 34% tariff on all US imports, a move in retaliation for US President Trump's tariffs, increasing concerns about a trade war between the United States and China. Commenting on the impact of US President Donald Trump's tariffs on the economy on Monday, Australian Treasurer Jim Chalmers said he expected the economy to take a hit. The Australian dollar fell mainly due to concerns about the Chinese economy. It also reflects that the market now expects Australia to make about four interest rate cuts this year.

AUD/USD has been deeply in a bearish trend since it posted its biggest one-day drop in history last Friday {-4.42%} and broke through the important multi-year key psychological level of 0.60. At the beginning of the week, the exchange rate fell to a new low of 0.6932 in nearly 5 years, forming a bearish "double bottom" pattern with the low of 0.6931 on March 25, 2020. The technical indicator Moving Average Convergence Divergence (MACD) on the daily chart continues to show new red bars, strengthening the downward momentum. At the same time, the 14-day relative strength index (RSI) has dropped to the 27.50 area, confirming the extreme oversold state. Although the stochastic oscillator looks neutral, the continued selling is further verified by the bearish/bullish strength indicator flashing red and the obvious divergence between the moving averages. All short-term and long-term moving averages continue to point downward, emphasizing the current downward trend. Therefore, the initial downside target is 0.5932 (low point at the beginning of the week), and 0.5900 (round mark), and if it breaks, it will go to 0.5839 (closing price on March 23, 2020). As for the upside, the initial resistance is 0.6040 (closing price at the end of last week), then 0.6087 {low point on February 3}, and 0.6089 {76.4% Fibonacci retracement level from 0.5509 to 0.7968} area, and if it stands above its exchange rate, it may challenge the double resistance level of 00.6187 (low point on March 4) in the short term.

Today, you can consider shorting the Australian dollar before 0.6015, stop loss: 0.6025; target: 0.5960; 0.5950.

GBP/USD

The British pound (GBP) plunged more than 150 pips or 1.27% against the US dollar at the start of the week, driven by recession fears, and hopes that the White House might rethink trade policy were dented over the weekend. GBP/USD traded as low as 1.2708, having hit a daily high of 1.2933 earlier. The retracement from the six-month high hit last week now appears to have paused near a one-month low hit during the Asian session on Monday. The broad reciprocal tariffs announced by US President Trump last Wednesday have sparked fears of an intensifying trade war that could hurt global growth. This continues to weigh heavily on investor sentiment and is showing a sea of ​​red in global stock markets. This is seen as a boon to the dollar’s ​​safe-haven status relative to the British pound and acting as resistance for the GBP/USD pair. On the other hand, the British pound appears to be supported by expectations that the Bank of England will be slower to reduce borrowing costs than other central banks, including the Federal Reserve. This in turn suggests that the path of least resistance for the GBP/USD pair is to the upside.

The reversal in GBP/USD last Friday could open the door for a challenge to the 1.2900 level. A daily close below this level would expose 1.2700 (round mark), followed by the February 26 low of 1.2635. The relative strength index (RSI), one of the technical indicators on the daily chart, has fallen sharply from about 70 to around 41, indicating that bears are gathering strength. On the bullish side, buyers must keep the pair above the 200-day simple moving average at 1.2811 and ideally above Friday's low of 1.2853, which could pave the way for a test of 1.30.

Today, it is recommended to short GBP before 1.2738, stop loss: 1.2750, target: 1.2670, 1.2660

USD/JPY

The yen filled the weekly gain gap with its US counterpart amid concerns that the possible imposition of tougher reciprocal tariffs by the United States could have a negative impact on the Japanese economy and forced the Bank of Japan to keep interest rates unchanged for the time being. However, signs of accelerating inflation in Japan leave room for further rate hikes in 2025. Apart from this, the prevailing risk-off environment helped the safe-haven yen to arrest its intraday retreat. However, signs of broad-based inflation in Japan open the door for further rate hikes in 2025. Apart from this, ongoing geopolitical tensions should limit any significant depreciation in the yen. On the other hand, the US dollar struggled to benefit from Friday's positive moves as the market bet on more aggressive policy easing by the Federal Reserve, weighed down by concerns over a tariff-driven US economic slowdown. Moreover, further sharp declines in US Treasury yields should provide support to the low-yielding yen and limit any significant rebound in the USD/JPY pair.

From a technical perspective, last week's breakout and acceptance below 146.95 (61.8% Fibonacci retracement of 139.58 to 158.88) is seen as a fresh trigger for USD/JPY shorts. Moreover, oscillators on the daily chart are deeply trapped in negative territory and are still far from entering oversold territory. This in turn suggests that the path of least resistance for spot prices remains to the downside. Therefore, any subsequent rebound above 150.00 (market psychological level), and 150.50 (last week's low) may be seen as a selling opportunity and limited around the 147.70 area. Next is the 148.00 round number level, which, if decisively broken, may trigger a short-term covering rebound. On the other hand, the 146.00 level, followed by the 145.45 area, the Asian session low of the 145.00 psychological level (around the 144.80 area), and the multi-month low reached on Friday (around the 144.55 area) may serve as immediate support. A break below the latter will further confirm the bearish bias, accelerating the USD/JPY pair's downward trend to the 144.00 round number level.

Today's recommendation is to go long USD before 147.80, stop loss: 147.50; target: 148.80, 149.00

EUR/USD

The EUR/USD pair reversed the decline to the 1.0880 area during the Asian session and now seems to have stopped the correction decline from around the mid-1.1100 area, the highest level since September hit last week. Spot prices are currently trading in the 1.0960 area, with little change on the day, and market signals are mixed. The US dollar failed to capitalize on Friday's rebound from six-month lows and appeared weak at the beginning of the new week as the market bet that the US economy may enter a recession and force the Federal Reserve to resume the interest rate cutting cycle. In fact, the market now expects the Federal Reserve to make four 25 basis point rate cuts by 2025. This, coupled with the rise in global risk aversion, has led to a further sharp decline in US Treasury yields, thereby weighing on the US dollar and providing some support for the EUR/USD pair. For now, the focus will remain on trade-related developments, which will have a key impact on broader risk sentiment and demand for the US dollar. This, in turn, could provide some momentum to the EUR/USD pair and help traders seize short-term opportunities.

From the technical indicators of the daily chart, the 14-day relative strength index (RSI) indicator remains above 60, and the rebound of EUR/USD after testing the 20-day simple moving average (1.0859) highlights the willingness of buyers to maintain control. If EUR/USD re-enters above .0955-1.0985, which is the highest level in March after a sharp rise to a six-month high of 1.114. It may be regarded as the next resistance level, followed by 1.1000 (market psychological level). On the downside, the support levels are located at the 20-day simple moving average of 1.0859, and 1.0800 (round number level) area levels.

Today, it is recommended to short the euro before 1.0923, stop loss: 1.0940, target: 1.0870, 1.0860.

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