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Market Overview
Macro & Geopolitics
The main theme for the new week is how monetary policy will take shape following the Fed's rate hike. Minneapolis Fed President Neel Kashkari said inflation pressure isn't limited to energy alone, and the possibility of an additional rate hike continues to weigh on bond yields and risk assets.
On the geopolitical side, tension along the Iran-US axis and Houthi attacks are raising security and energy-supply concerns in the Middle East. Risks along the Strait of Hormuz and the Bab el-Mandeb strait could keep volatility elevated in markets via energy costs.
Separately, Xi Jinping's visit to the US and his planned meeting with Donald Trump are being closely watched. Messaging on trade, Iran, AI, and security will matter for global risk appetite.
Today's Economic Calendar (GMT)
| Time | Ccy | Event | Fcst | Prev |
|---|---|---|---|---|
| 15:00 | EUR | ECB President Lagarde Speaks | — | — |
| 15:30 | USD | 3-Month Bill Auction | — | — |
EUR/USD · FX Major
Rising energy costs and inflation expectations remain important for the euro. The ECB's latest survey showed higher inflation expectations, signaling that price pressures could persist, while the impact of high energy costs on growth is complicating the ECB's policy balance. In the US, the Fed's tight stance and elevated bond yields are supporting the dollar. This backdrop is weighing on EUR/USD, though expectations of further ECB tightening could limit the euro's losses.
The 1.1510 level stands out as a key resistance zone for the pair, while 1.1450 can be followed as the first strong support level on downside moves.
| Resistance | Support |
|---|---|
| 1.1510 | 1.1450 |
| 1.1540 | 1.1420 |
| 1.1570 | 1.1390 |
GBP/USD · FX Major
UK retail sales coming in above expectations supported the pound, while the Bank of England held its policy rate at 3.75% and slowed its bond-sale program. Inflation staying elevated at 3.1% keeps alive the prospect that the BoE could hike rates again. This backdrop could support sterling, while the Fed's hawkish stance and elevated US bond yields could limit gains in GBP/USD.
Should the pair extend its upward trajectory, 1.3420 stands out as a strong resistance level, while 1.3360 can be followed as the first key support zone on any downside moves.
| Resistance | Support |
|---|---|
| 1.3420 | 1.3360 |
| 1.3450 | 1.3330 |
| 1.3480 | 1.3300 |
XAU/USD · Metal
Expectations that a high-rate environment could persist following the Fed's latest hike are weighing on gold. Minneapolis Fed President Neel Kashkari's remarks that inflation remains strong, and his openness to further rate hikes, could keep US Treasury yields elevated and limit gold's upside. In contrast, Iran-US tensions and security risks in the Middle East continue to support safe-haven demand. Rising risks along the Strait of Hormuz and Bab el-Mandeb are also reinforcing energy-driven inflation concerns. As a result, the balance between the Fed's tight stance and geopolitical risks will remain the deciding factor for gold.
Technically, 4390 and 4420 stand out as key resistance levels respectively, while 4330 and 4300 remain the support levels to watch on the downside.| Resistance | Support |
|---|---|
| 4390 | 4330 |
| 4420 | 4300 |
| 4450 | 4270 |
XAG/USD · Metal
The People's Bank of China holding its benchmark lending rates steady shows it remains cautious about broad-based monetary easing despite weak domestic demand. Given silver's heavy industrial use, China's growth and investment outlook remains important on the demand side. On the other hand, the continuation of a global supply deficit in silver and resilient physical investment demand stand out among the factors supporting silver over the medium term.
The $69 level stands as the first key resistance level, while $63 can be followed as the first support point on any pullback.
| Resistance | Support |
|---|---|
| $69 | $63 |
| $72 | $60 |
| $75 | $57 |
Brent Oil · Energy
The prolonged Hormuz crisis, attacks on Saudi energy infrastructure, and new risks along the Bab el-Mandeb strait are increasing uncertainty over oil supply. The unpredictable duration of Hormuz disruptions, combined with pressure on alternative shipping routes, is keeping the geopolitical risk premium in the market elevated. Prolonged supply disruptions and an expansion of regional conflicts could keep upside risks alive for oil, while a reduction in diplomatic tension or a clear normalization of Hormuz traffic could ease the risk premium and create selling pressure.
Technically, $100 and $103 stand out as key resistance levels, while $97 and $94 remain the support levels to watch on the downside.
| Resistance | Support |
|---|---|
| $100 | $97 |
| $103 | $94 |
| $106 | $91 |
Bitcoin · Crypto
Expectations that a high-rate environment could persist following the Fed's latest hike are weighing on Bitcoin. Fed officials' messaging that inflation remains elevated is supporting bond yields, while the pullback in energy prices could ease inflation concerns and provide limited support to risk appetite. On the regulatory side, renewed capital inflows into Bitcoin funds despite uncertainty around the Clarity Act process point to resilient institutional demand. High rates could limit Bitcoin's upside, while continued ETF inflows, a pullback in bond yields, or positive regulatory developments could strengthen buying appetite.
Technically, $83K and $86K stand out as key resistance levels respectively, while $78K and $75K remain the support levels to watch on the downside.
| Resistance | Support |
|---|---|
| 83K | 78K |
| 86K | 75K |
| 89K | 72K |
