Global markets are rounding out the month on a steadier footing compared to that frantic first week of April, with tariff tensions having abated. After ‘Liberation Day (on April 2nd), the S&P500 index fell approximately 10% in just two days, before the announcement of tariff pauses by the Trump administration provided the catalyst for a rebound. And while there have been numerous other bumps along the way, including but not limited to Trump openly mulling about Jerome Powell’s position as Fed Chairman, the S&P is close to where it began the month (with one session still to go for the month).
April’s tariff-induced extreme volatility has been one for the books. And while there is currently optimism that trade deals may soon arrive and could be at tariff levels well south of those announced on ‘Liberation Day,’ any progress between the US and China is what risk assets will be most attuned to. Further, any prolonged absence of a US-China deal could see global growth worries quickly come to the fore once again. Essentially, markets are now on ‘trade-deal watch’, and this shapes as being the key sentiment driver as we roll from April into May.
Gold has been oscillating either side of the $3300 mark for much of the past week, having eased back from its charge to $3500 (on April 22nd). Trump, Bessent (Treasury Secretary) and Lutnick (Commerce Secretary) have each been sounding upbeat about forthcoming trade deals, which has caused safe haven demand to take a step back the gold price to moderate accordingly. The pullback in gold has been constrained so far, with buyers remaining keen on gold when dips occur. $3296 offers some support, before a firmer support level awaits at $3275. On the top side, immediate resistance is at $3346 ahead of $3372. If trade deals start to emerge this could slow gold’s progress. But Trump’s policy-making style has been keeping markets nervous in 2025, which means gold is still a favoured asset to cover geopolitical uncertainties.
The recovery of the USD from its 3-year lows has also been a headwind for gold. Having dipped below the 98-level last week, the Dollar Index (DXY) has recovered to trade at 99.25 (as of early Asian trading hours on Wednesday). Much like gold, the near-term direction of the USD could hinge on which if any trade deals arrive over coming weeks, with trade deals likely to be positive for the USD and negative for gold, if recent trends hold. For the DXY, support levels to watch this week are at 98.76 and 98.30, while resistance is at 99.65, which if overcome would open the door for a potential run back to the 100 level.
Oil is under pressure again with OPEC apparently considering further production increases. The prospect of added supply is dragging down the crude price. The WTI (US crude) price slipped around 2.5% on Tuesday, while easing geopolitical tensions (such as Russia’s announcement of a 72-hour ceasefire in its conflict with Ukraine around Victory Day) have taken a degree of risk-premium out of the price. The oil market is jumping around a lot still on trade and geopolitical headlines, and as such, the near-term outlook is neutral. Levels to watch are support at $59.40 and $58.70, while resistance is at $61.30 ahead of a sterner test at $62.65.
Aside from being on the lookout for any US trade deals, there is a raft of key economic data coming up this week, headlined by US GDP and Core PCE Price Index (both due on Wednesday) ahead of non-farm payrolls (NFP) on Friday, which will give us a look at how the US labour market has been faring amid growth concerns. So, there will be plenty of data for us to chew over between now and the end of the week with a view to the Fed’s potential interest rate path in the second half of 2025.
Dedicated Customer Support Representative
.svg){kind=small}
Start trading now
In three simple steps!
.svg){kind=small}
Fill out some basic information
Upload the required documents
.svg){kind=small}
Open your MT4/MT5 account
%201.png)
