Gold hits all-time highs. Yen strengthens. Traders flee US assets as tariff fears mount.
- forex368 Forex Education
- 2 days ago
- 3 min read
Macro Wrap: Trade War Reignites Risk Aversion
Markets are facing a brutal end to the week, as fresh escalations in the US-China trade dispute hammer sentiment across asset classes. Asian equities have sold off hard —
Japan’s Nikkei down over 4%, and South Korea's KOSPI sliding 1%. Despite an initial bounce following Trump’s tariff delays, investors are no longer buying the dip. Confidence in US assets is eroding fast, with bond yields surging and the dollar under siege.
The US 10-year yield jumped to 4.45%, its biggest weekly rise since 2001. The dollar has dropped to multi-year lows vs the Swiss franc and yen, while gold surged to a new all-time high at $3,210 as a classic safe haven rotation takes hold.
Tariff tensions and fear of recession are forcing a global portfolio realignment — from US equities and debt into havens like XAUUSD, EURUSD, and JPY crosses. The euro is also climbing as Europe appears insulated from some of the worst trade fallout.
Fundamental Outlook: Repricing the US Narrative
Today’s data calendar is heavy on US inflation prints (Core PPI, PPI m/m) and consumer sentiment. But macro trading has taken a backseat to geopolitics and flows. A weak US CPI print on Thursday failed to lift markets, further evidence that risk aversion is now the dominant theme.
The UK’s better-than-expected GDP (+0.5% m/m vs 0.1% forecast) could support the FTSE and sterling short-term, but broader risk sentiment may limit upside.
Meanwhile, the yen and gold are catching strong bids. The euro is rallying not just on USD weakness, but also flows from institutions seeking non-dollar assets with less headline risk.
Technical Outlook (4H Charts & Key Levels)
🔹 Gold (XAU/USD)
Bias: Bullish Continuation | Price: $3,196
Gold hit a fresh all-time high at $3,219 before retreating modestly. Momentum remains strong, with RSI just off overbought, and price riding the upper Bollinger Band. The breakout above $3,150 confirms the bull trend, supported by safe haven demand and USD weakness.
Entry: $3,190–3,200
SL: $3,158
TP1: $3,240
TP2: $3,280
Extension: $3,325
Only a sustained break below $3,150 would delay the bullish outlook.
🔹 EUR/USD
Bias: Bullish | Price: 1.1264
Euro surged to 1.1323, retracing slightly this morning. The RSI is high but not extreme, and price is holding well above the mid-Bollinger band. A close above 1.1300 on the 4H opens the path to 1.1385 (Feb 2022 high).
Entry: 1.1240–1.1260
SL: 1.1175
TP1: 1.1330
TP2: 1.1385
Extension: 1.1450
🔹 USD/JPY
Bias: Bearish | Price: 144.00
Dollar/yen continues to trade lower as JPY inflows mount. 144 is now key support-turned-resistance. The pair bounced slightly off 143.00, but structure favours further downside. Watch for break-and-close below 142.80.
Entry: 144.20–144.50 (sell the bounce)
SL: 145.20
TP1: 143.00
TP2: 142.00
Extension: 141.20
🔹 FTSE 100 (UKX / SPREADEX)
Bias: Rebound Risk | Price: 8,002
FTSE has stabilised around 8,000 after steep declines, aided by UK GDP surprise. RSI rebounded from oversold and price is attempting to reclaim the mid-Bollinger band. A break above 8,080 would confirm a short-term bottom.
Entry: 7,970–8,000
SL: 7,880
TP1: 8,080
TP2: 8,160
Extension: 8,240
Market Sentiment Summary
Gold & JPY: Still the preferred safe havens; both have room to extend.
USD: Heavy across the board; downside momentum accelerating.
EUR: Buoyed by flows and USD weakness; bullish structure intact.
FTSE: Eyeing short-term bounce, but macro risks cap upside.
Risk Assets: Repricing still incomplete. Be cautious on intraday longs.
Kyri’s Thought of the Day
Markets are yo-yoing — gold’s running, dollar’s soft, but it’s all headline-driven. We’re not in clean trend territory, so you’ve got to stay selective.
Today’s a day to let fundamentals lead. The setups are there, but context is everything. Don’t chase. Wait for price to come to your levels, then act.
About These Signals:
These signals are not financial advice and are not part of any sales or promotion. They’re simply shared as part of my independent trading outlook—based on a combination of technical structure, fundamental context, and over 30 years of industry experience.
Each idea reflects how I’m reading the market at that moment. They're designed to spark thinking, not push trades.
Use them to inform your own view—never to replace it. Always manage your risk. Always do your own research.
These market ideas are shared as references for traders—especially swing traders, day traders, and scalpers.
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