Market Overview
- The forex market experienced significant movements, with major currency pairs and gold reacting to various economic themes and risk factors.
- The EUR/USD pair fell to 1.1200 due to a boost in USD bids following news of a potential US-UK trade deal. However, the pair struggled to surpass 1.1300 as traders awaited key developments.
- GBP/USD fell 0.34% after the Bank of England cut rates as expected, while the US Dollar gained strength amid hopes for progress on US trade deals.
- Silver price remained steady, supported by positive market sentiment from a US-UK trade deal and hopes of reduced US-China tensions.
- The AUD/NZD pair traded near the 1.0800 zone after modest gains on Thursday, with short-term indicators supporting a bullish bias despite mixed long-term signals.
- The USD/JPY pair rose due to the Federal Reserve's decision to keep interest rates unchanged and positive US-UK trade news.
Fundamental Analysis
- Major economic events included potential US-UK trade deal, central bank statements from the Federal Reserve and Bank of England, and jobless claims data from the US.
- The ECB in Frankfurt sets interest rates and manages monetary policy for the Euro, with inflation data and economic indicators like GDP and trade balance impacting its value.
- The Bank of England cut rates, impacting GBP's value. Trade Balance also influences the Pound, with a positive balance strengthening the currency.
- Mexico's inflation accelerated in April, but Banxico's Heath signals a continued easing path. The USD/MXN was pressured by improved risk sentiment after a US-UK trade deal boosted EM currencies.
Technical Analysis
- EUR/USD shows bearish outlook with key support levels at 1.1270, 1.1175, and 1.1080, while resistance levels are at 1.1380, 1.1430, and 1.1500.
- GBP/USD shows potential support levels at 1.3200 and 1.3165, with resistance at 1.3320-1.3330 and 1.3400.
- USD/JPY is in a bullish pattern near 146.00, with key support levels at 144.78 and resistance at 146.18.
- Gold prices fell below $3,400, with momentum indicators suggesting a potential further decline.
Conclusion
- The forex market remains sensitive to geopolitical developments, central bank decisions, and economic data releases.
- Traders should monitor key currency pairs for potential trading opportunities based on technical analysis and fundamental factors.
- The upcoming US-China trade talks and the Bank of Mexico's interest rate announcement on May 15 will likely have significant impacts on the market.
- Overall, the market sentiment is mixed with a cautious outlook due to ongoing trade tensions and central bank decisions.
