Market Overview
Implemented Tariffs
- Baseline Tariff: 10% on all imports to the U.S., effective April 5, 2025, excluding Canada, Mexico, and Belarus.
- Automotive Tariffs: 25% on non-USMCA-compliant vehicles and parts, effective April 3, 2025.
- Aluminum & Steel Tariffs: Section 232 tariffs increased to 25% on aluminum (including beer cans and other derivatives), effective March 12, 2025.
Reciprocal Tariffs (Effective April 9, 2025):
- China: 34% tariff
- European Union: 20% tariff
- Angola: 32% tariff
- Cambodia: 49% tariff
- Other Countries: Varying from 11% to 50%, based on bilateral trade imbalances
Planned Tariffs by Other Countries
- China: Export controls on rare earth metals, effective immediately
- European Union: Planned $8B in duties on U.S. goods, including tech and agriculture
- Brazil & India: Threatened 100% tariffs on U.S. goods unless exemptions are granted
These developments are stirring significant volatility across global markets. The scale and speed of these tariff changes are disruptive and carry the potential to escalate into a full-blown trade war. While the U.S. appears focused on strengthening domestic economic resilience, this strategy is straining international relations and putting pressure on foreign economies. It also accelerates the likelihood that countries will seek alternative trade routes and alliances.
Fed Chair Powell stated the economic impact of the new tariffs may be larger than initially expected, potentially leading to slower growth and higher inflation. He emphasized the Fed remains in a wait-and-see position regarding monetary policy changes.
Markets are currently pricing in a 34% chance of a -25 bps rate cut following the May 6–7 FOMC meeting. However, the more impactful data will likely emerge in the months ahead, as the true effects of the tariffs begin to materialize.
From our perspective, this sudden wave of tariffs could be deeply detrimental to businesses. Companies have been given little to no time to prepare, effectively tossing out any strategic planning processes. This lack of preparation will drive price increases, disrupt supply chains, and force companies to cut back on operations, further slowing growth. Consumers, sensing instability and inflation, may pull back on spending, causing a self-reinforcing slowdown.
At this point, patience is key. We need to closely monitor how markets digest and react to these developments over the coming days and weeks.
Market Analysis
GOLD
GOLD prices are too volatile. Recommendation: Stay away unless you have enough money to sustain your trades. There is too much market volume moving through the market. The MACD and the RSI are showing continuation sell signals, but the price hit us with an aggressive bullish candle during the Asian range. However, the overall movement of prices does show potential for another sell-off. Although from this point in the market, there are expectations that we will see increased chances for a consolidation extension instead. The sudden sell-off, despite the supposed bullish expectation for GOLD prices, might be due to investors selling off gold to realize profits—potentially to cover losses or margin calls on other assets. This could trigger a cycle, with more investors selling, further driving down prices in a negative feedback loop.
We wait for more clues to confirm this finding of ours. Otherwise, we remain watchful of how the markets will progress in the coming days. We will personally stay away from trades, as the movements are too large and risky.
SILVER
SILVER prices are reflecting the momentum of GOLD prices, selling off aggressively as GOLD did. The MACD and the RSI are showing increased bearish volume and momentum. There are increased expectations for prices to continue selling in the coming days. We remain watchful of how prices will continue in the days ahead.
DXY
The Dollar is also looking very bullish after the announcements on tariffs were made. We can see the MACD suddenly gained increased volume alongside the RSI showing normalization in the buying. This was contrary to expectations but remains within the structure we can see. The overall price action is still bearish. Despite the move up, there is no complete shift in structure. We can still see the EMA200 potentially acting as effective resistance to prices.
GBPUSD
The Pound is currently seeing increased selling momentum and volume, as reflected by the RSI and the MACD. The overall price action also shows a complete shift in market direction. This came suddenly after last week’s trading. We expect further selling to continue in the coming days.
AUDUSD
The Aussie dollar shows a clear break in the sell after last week, continuing the market weakness bearish. We expect further selling in the coming days but sustain a level of conservatism. The market is very unsustainable at the moment and may shift at a moment’s notice. The MACD and the RSI are showing increased volume and bearish momentum.
NZDUSD
The Kiwi has done the same thing as the Aussie dollar, only this has shifted quicker and against our expectations. We did see a clear shift to buying, but the market fundamentals shifted the trading back to sell—showcasing the weakness of the Kiwi as the overall sentiment of markets is set to risk-off. The MACD and the RSI are showing increased volume and bearish momentum. We look into more bearish opportunities in the coming days. However, we do remain conservative.
EURUSD
The Euro is currently facing increased selling as they are one of the countries hit by higher tariffs due to the reciprocal tariff plan. Until we see a conversation going between them and the U.S. to lower this, there are increased weakness expectations for the EU. Thus, we look for more bearish opportunities. We can also see the MACD and the RSI show this increase in selling momentum.
USDJPY
The Yen fairs better than the U.S. The Yen is being seen as a good alternative against the risks of the Dollar and the other markets at the moment. We can see clear price action fighting through and into the structures, showing potential to continue the selling, as overall price action did shift momentum to bearish. The MACD and the RSI are also showing an increase in bearish movement, as they show increased buying despite prices staying stagnant. This shows us that there is not enough volume nor momentum to bring prices up. We look for more selling opportunities in the coming days but remain conservative for whatever may happen.
USDCHF
The Franc fairs better than the USD. This comes to show that like the Yen, the Franc is acting as an effective hedge against the Dollar. There are expectations for further market continuation down, as we can see the RSI and the MACD reflect the same thing as in the Yen. We look for more selling opportunities.
USDCAD
The CAD weakness continues as last week’s trading concluded. This morning allowed us to see prices touch the EMA200 and the lower boundary of the consolidation zone. The MACD and the RSI are seeing increased bullish volume and momentum. If prices manage to break above the EMA200 and back into the consolidation zone, overall price action will shift back to bullish—allowing us to look for more bullish movements in the coming days.
COT Reports Analysis
“AUD – WEAK (4/5)
GBP – WEAK (3/5)
CAD – WEAK (5/5)
EUR – WEAK (3/5)
JPY – STRONG (5/5)
CHF – WEAK (5/5)
USD – STRONG (5/5)
NZD – WEAK (5/5)
GOLD – STRONG (5/5)
SILVER – WEAK (3/5)”