Market Overview
Key economic releases this week:
- March 12: JOLTS Job Openings (USD)
- March 13: Core CPI, CPI m/m & y/y (USD); BOC Rate Statement, Overnight Rate, Press Conference (CAD)
- March 14: Core PPI, PPI, Unemployment Claims (USD)
- March 15: GDP m/m (GBP); Prelim UoM Consumer Sentiment & Inflation Expectations (USD)
With rate cuts on hold, attention shifts to the strength of the U.S. economy amid trade war concerns. The question remains: Will Trump’s policies bolster economic growth, or will increasing voter dissatisfaction highlight deeper economic vulnerabilities? To gain insight, we must analyze the stock market’s current performance.
As of March 2025, the U.S. stock market is experiencing a slowdown. The S&P 500 is down 2% YTD, while the Nasdaq has declined by 6%. After two years of strong growth, a period of consolidation appears to be unfolding.
- Dow Jones: 42,802 (+0.6% YTD)
- S&P 500: 5,770 (-1.9% YTD)
- Nasdaq: 18,196 (-5.8% YTD)
Defensive sectors, such as healthcare and consumer staples, are leading, while technology and consumer discretionary stocks struggle due to high valuations. The Atlanta Fed currently projects Q1 GDP growth at -2.4%. While a recession is not imminent, persistent economic weakness could prompt the Federal Reserve to introduce three rate cuts in 2025 to stimulate growth.
Recent stock movements highlight market divergence. Nvidia, UnitedHealth, and IBM have seen gains, with Nvidia rising 3.29%. In contrast, Intel, Boeing, American Express, Walt Disney, and JPMorgan Chase have declined, with Intel dropping 5.54%.
This performance raises concerns about the broader economic landscape. The U.S. economy heavily relies on the wealthiest individuals, with the top 1% of taxpayers holding a substantial share of total adjusted gross income. A stock market downturn could trigger economic instability, leading to lower consumer confidence, job losses, and decreased spending. With the stock market serving as a key economic indicator, its movements will significantly influence expectations for growth or potential contraction.
Market Analysis
GOLD
Gold prices remain stagnant despite last week’s NFP release. Instead of a significant reaction, gold has been moving sideways, awaiting a clearer directional bias from the U.S. dollar. The MACD and RSI are currently offering limited signals, indicating market indecision. However, prices remain above the EMA200, suggesting continued respect for bullish structure. Until a breakout occurs, traders should look for opportunities to buy on dips.
SILVER
Silver is showing increased bullish potential, with the current market price stabilizing at 32.5177. The RSI is approaching overbought levels, indicating a likely continuation of consolidation. Meanwhile, the MACD is at exaggerated levels, suggesting that the selling momentum may weaken. The EMA200 is currently acting as strong support, reinforcing the potential for an upward move. Unless a definitive breakdown occurs, silver remains a candidate for long-term bullish positioning.
DXY (US Dollar Index)
The dollar continues its downward trajectory, with little chance of a meaningful recovery. While the MACD reflects growing bullish volume, price action fails to confirm any substantial upside potential. The RSI frequently registers overbought conditions on minor rallies, reinforcing strong bearish momentum. As a result, traders should focus on selling opportunities, particularly if the upcoming economic releases confirm weakness in the U.S. economy.
GBPUSD
The British pound reached a new high last week but has since entered consolidation, awaiting further market cues from the dollar. While Monday’s session remains quiet, key economic data later in the week could shift momentum. The MACD and RSI currently lack clear signals, reflecting the market’s neutral stance. Traders should monitor upcoming news events to determine the next directional move.
AUDUSD
The Australian dollar is consolidating just below its previous swing high. While the initial breakout demonstrated strong bullish momentum, the subsequent pullback is not surprising. The market remains supported by the EMA200 and previous demand zones. The MACD has crossed upward, signaling potential buying opportunities. However, the RSI is currently flat, indicating the likelihood of further consolidation before a decisive move.
NZDUSD
The New Zealand dollar remains supported by the EMA200, showing increased bullish sentiment. Price is encountering resistance at the zone high, but the MACD is nearing a bullish crossover. The RSI is holding steady after nearly reaching overbought levels, reinforcing market indecision. While the broader trend remains bullish, traders should wait for confirmation before entering long positions.
EURUSD
The euro remains within consolidation but managed to print a new high last week. Given ongoing dollar weakness, expectations for continued bullish momentum remain intact. The MACD is reflecting minor selling pressure, while the RSI remains stable. Price action suggests that the market is maintaining healthy levels. If the dollar continues to decline, EURUSD could experience further upside.
USDJPY
The Japanese yen has gained strength, although price action remains consolidated despite making a new low. While this move appears promising, it may also indicate the potential for a bullish reversal. The MACD is signaling a buy, even as price action lags, while the RSI remains elevated. If bearish momentum persists, USDJPY could continue its downward trajectory. However, traders should watch for potential trend reversals.
USDCHF
The Swiss franc is showing increased bearish momentum, with stronger selling pressure compared to other major currency pairs. The MACD is displaying an upward shift, but the RSI is already overbought, suggesting a limited upside. Given these conditions, selling opportunities remain favorable, particularly if dollar weakness continues.
USDCAD
The Canadian dollar is struggling to find direction, with price action remaining relatively stagnant. The EMA200 is currently acting as a key support level, while the MACD is reflecting increased bullish volume. The RSI is moving lower, indicating a potential market reset. While the possibility of a bullish reversal remains, traders should wait for a more decisive market trend before committing to a trade.
COT Reports Analysis
- AUD – WEAK (5/5)
- GBP – STRONG (5/5)
- CAD – WEAK (5/5)
- EUR – WEAK (1/5)
- JPY – STRONG (5/5)
- CHF – WEAK (3/5)
- USD – STRONG (4/5)
- NZD – WEAK (5/5)
- GOLD – STRONG (3/5)
- SILVER – STRONG (4/5)
Conclusion
With statistical forex analysis, data-driven trading strategies, and quantitative risk assessment, this market update provides a comprehensive overview of current economic conditions. Machine learning forex models and algorithmic market predictions indicate that key economic releases this week will play a critical role in determining future market trends.
As the stock market slows and inflationary pressures persist, traders should closely monitor economic data and central bank policies. With market volatility increasing, strategic positioning will be essential in navigating upcoming trading opportunities.