US President Trump’s peace plan for Ukraine, tax priorities, and a missing aircraft near Alaska reignited geopolitical tensions, halting the US Dollar’s fall. However, China’s focus on trade talks and weaker US employment clues kept the Dollar's rebound in check. Concerns from the Bank of International Settlements (BIS) about economic risks and Trump’s policies, combined with pre-NFP anxiety, limited market momentum.
The US Dollar Index (DXY) regained some ground, paring weekly losses, while a dovish ECB stance and weak EU data weighed on EURUSD. The BoE’s dovish outlook pressured GBPUSD, and AUDUSD and NZDUSD remained sidelined after pausing their uptrend. USDCAD ended its four-day losing streak ahead of the US and Canada employment reports.
USDJPY rebounded from a two-month low, but the IMF's praise for the BoJ’s rate hike and hawkish comments from BoJ officials kept Yen sellers hopeful. Gold remains bullish despite Thursday’s retreat, supported by geopolitical uncertainty and mixed US data easing Fed rate cut fears.
Crude Oil faces a three-week downtrend amid rising US inventories and Trump’s push to lower prices, with concerns over weakened Chinese demand. At last, cryptocurrencies are set for their second weekly loss despite a bounce, as discussions of stablecoins and the potential launch of a Bitcoin ETF by Trump media add some volatility.
Thursday’s dovish comments from ECB policymakers Boris Vujčić and Piero Cipollone, along with weak Eurozone Retail Sales and the US Dollar’s bounce, brought EURUSD sellers back into play. However, the pair still eyes weekly gains, with mostly disappointing US data challenging the Fed’s readiness to stop rate cuts.
Meanwhile, GBPUSD dropped after ending a three-day winning streak, following the BoE’s 0.25% rate cut. Additional downside pressure on the Pound came from BoE Governor Andrew Bailey's remarks about a flat economy and the potential for further rate cuts.
At the same time, IMF Deputy Managing Director Gita Gopinath’s praise for the BoJ's rate hikes kept USDJPY sellers active, with BoJ policymaker Naoki Tamura’s comments on potential rate hikes further supporting the downtrend.
The Australian, New Zealand, and Canadian Dollars are on track for strong weekly gains, driven by a weaker USD and easing US-China trade war fears. However, the recent rebound in the US Dollar has paused the rise of AUDUSD and NZDUSD, while triggering a corrective bounce in USDCAD from a three-week low. Despite this, the commodity-linked currencies’ gains are less reliable, largely ignoring falling crude oil prices and concerns about further rate cuts from their central banks.
Gold remains steady at record highs, poised for a six-week uptrend despite a brief pause in its recent gains. The precious metal benefits from market demand as a haven during times of trade and geopolitical uncertainty, particularly with a weak US Dollar. Additionally, rising demand from major gold consumers India and China further supports gold’s strength ahead of today’s US jobs report.
Crude oil, after halting a two-day losing streak at a six-week low, is still on track for a three-week downtrend. Trump’s push for more oil supplies, alongside fears of China struggling to sustain energy demand amid economic challenges, weighs on prices. Additionally, rising inventories and a potential OPEC+ supply boost after Q1 2025 add further downside pressure.
Meanwhile, discussions around stablecoins as reserves and Trump media’s Bitcoin ETF plan have helped BTCUSD and Ethereum (ETHUSD) trim weekly losses, though both remain on course for a two-week downtrend. Despite optimism around Trump’s influence and a weaker US Dollar, BTCUSD and ETHUSD are struggling, as market players hold off on buying after a strong surge last month.
The upcoming US and Canada monthly employment reports will be closely watched, especially as they challenge the Fed's hawkish stance and favor the Bank of Canada’s readiness for rate cuts. Updates from the Trump administration on geopolitics and tariffs, along with speeches from lesser-known central bankers, will keep intraday traders engaged.
A softening in the US Nonfarm Payrolls (NFP) and Average Hourly Earnings could drive the US Dollar lower and push Gold to a new record high, possibly reaching the $2,900 mark. However, stronger-than-expected data might prompt a USD rebound and pull Gold prices back, which is more likely.
USDCAD could extend the latest rebound, supported by the Canadian jobs report and the Bank of Canada’s dovish outlook, as well as soft Crude Oil prices, Canada’s key export. Geopolitical concerns around Canada could also boost the Loonie pair.
Meanwhile, EURUSD and GBPUSD might keep retreating, while USDJPY could see a pullback. AUDUSD and NZDUSD are unlikely to rebound, even with disappointing US data, and cryptocurrencies and equities are expected to remain under pressure.
May the trading luck be with you!
