The US dollar fell below the 99 mark, and gold rose sharply at the opening!

On April 21, early trading in the Asian market on Monday, Beijing time, the US dollar index hovered around 98.63. Last Friday, affected by Good Friday, the United States, many European countries, Australia and China's Hong Kong Stock Exchange were closed for one day. CME's precious metals, U.S. crude oil, foreign exchange and stock index futures contracts and Brent crude oil futures contracts under the Intercontinental Exchange (ICE) were suspended throughout the day.

Analysis of major currencies

Dollar Index: As of press time, the US dollar index hovers around 98.63. Market sentiment deteriorated sharply after the White House announced a staggering tariff of 145% on Chinese imports, followed by Beijing’s retaliation measures, imposing a 125% tariff on U.S. goods starting April 12. The Federal Reserve kept interest rates unchanged at 4.25%-4.50% at its March 19 meeting, choosing to remain cautious in an increasingly volatile environment. Officials lowered their 2025 GDP forecast to 1.7%, raising inflation expectations from 2.1% to 2.7%, highlighting concerns amid the stagflation context. Technically, as inflation remains above target, tariffs disrupt trade flows, and political noise blurs policy outlook, the dollar looks to continue to face volatility. All eyes are now turning to the preliminary PMI next week and speeches from Fed officials to find clues to the next step. Technically, the U.S. dollar index trades below its 200-day simple moving average (104.63), sending a bearish signal.

Euro: As of press time, the euro/dollar hovers aroundNear 1.1472. The EUR/USD broke through the multi-day trading range and hit a new high since February 2022, near the 1.1485 area. Bearish sentiment around the dollar supported the momentum, which supported the prospect of continuing the recent solid upward trend. Traders will draw inspiration this week from ECB President Christine Lagarde’s scheduled speech on Tuesday and a series of speeches from influential FOMC members this week. In addition, the market focus will be on the release of initial PMI values, which may provide new insights into the health of the global economy. This, in turn, may provide some impetus for the U.S. dollar and Euro/USD pairs. Nevertheless, the fundamental background shows that the path of the currency pair with the least resistance is still upside, and any correctional pullback may be bought. Technically, the price trend shows that the euro is preparing to expand its gains outside the region, opening the door for further upward trend. Key resistance is at the high of 1.1473 on April 11, followed by the peak of 1.1498 in February 2022, followed by 1.1500.

GBP: As of press time, GBP/USD is hovering around 1.3336. UK economic data shows signs of resilience, with strong wage growth and GDP data improving. However, inflation relief is fueling expectations for a rate cut for the Bank of England (BoE). CPI slowed to 2.6% year-on-year in March, lower than expected, while monthly inflation fell slightly to 0.3%. Inflation rate for core services, a key indicator of the Bank of England, fell to 4.7%. Technically, the pound/USD will continue its uptrend, setting a daily weekly high below 1.3291, as investors enter the Easter holiday, affecting trading volume. Although the Relative Strength Index (RSI) indicates further upside, buyers need to recover 1.3300 to challenge the peak of 1.3389 on October 1, 2024, above 1.34. For the bearish continuation, traders need to push GBP/USD below 1.3200 to test the April 15 low of 1.3163.

Analysis of gold and crude oil market trends

1) Analysis of gold market trends

On the Asian session on Monday, gold trading around 3353.15. In the early trading of the Asian market on Monday, gold rose to around $3,350, after facing some profit-taking due to a long weekend. Uncertainty in tariff policies and ongoing geopolitical tensions continue to support gold.

Technical: Technically speaking, the trend is upraising. Trading breaking through last week's high of $3357.78 will mark the recovery of the uptrend with no resistance seen. Last week, investors bought strongly. This strategy may continue this week, but if they turn to "buy on dips", they switch to the daily chart for support, as weekly chart support is at $3095.25.

2) Analysis of crude oil market trends

On the Asian session on Monday, crude oil trading around 63.12. International oil prices have surged sharply by more than $1 as U.S. energy secretary Chris Wright said the U.S. could cut off Iran's crude oil exports across the board to force Iran to concessions on its nuclear program. Last Friday, China announced a 125% tariff on U.S. products starting Saturday, far higher than the previously announced 84%. The decision comes after Trump raised tariffs on China to 145% on Thursday.

Technical: Since the technical research on the daily chart is mainly negative and remains completely bearish every week, the recovery may face greater resistance, which indicates that stronger upward efforts are still needed to improve the situation (continuous breakthrough breakdown 50% of Fibonacci, daily Kijun-sen strengthened at $63.63, which is considered a minimum requirement). Furthermore, the fundamental factors supporting the current recovery will be offset by the recent cuts in oil prices and demand growth in OPEC’s Energy Information Administration, as the existing economic crisis may deepen if negotiations fail and the trade war escalates.

Forex market trading reminder on April 21, 2025

①To be determined, the 2025 World Bank and IMF spring meeting will be held

②15:00 State Information Office will hold a press conference

③20:30 Fed Gulsby will be interviewed by the media

④22:00 The monthly rate of the leading indicator of the United States Chamber of Commerce in March

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