DBG Markets: Market Report for May 14, 2025

MARKET ANALYSIS

GOLDGold prices remained largely unchanged yesterday, weighed down by easing geopolitical tensions between Russia-Ukraine and Pakistan-India. Notably, Presidents Zelenskyy and Putin attended a peace-focused convention, marking a rare diplomatic effort. Meanwhile, ongoing trade de-escalation between the U.S. and China continues to undermine safe-haven demand, favoring a stronger dollar over metals.

Technically, charts continue to respect bearish structures, with further downside likely if prices fail to reclaim 3260.22. The MACD shows increased bearish volume despite low price movement, while the RSI reflects consolidation, swinging between overbought and oversold zones. We await a clear breakout, but anticipate a continuation lower if the current range holds.

SILVERSilver remains in consolidation, largely tracking golds indecision. With no definitive signals from the broader metals market, we refrain from making trade calls unless you're actively trading within the range.

DXYThe dollar experienced selling pressure after cooler-than-expected inflation data softened concerns that Trumps tariffs were heavily inflationary. This has prompted a reassessment of future Fed policy, with some analysts dialing back expectations of aggressive rate cuts, especially given the 90-day tariff pause.

Technically, the MACD signals rising bearish momentum, and the RSI has normalized, suggesting more downside is possible, potentially toward the EMA200, before any continuation higher. However, should upcoming data (including retail sales and PPI) surprise to the downside, fears of U.S. economic weakness could prompt fresh rate cut expectations. Conversely, improving global conditions may put the U.S. economy back in focus as a relative outperformer.

GBPUSDWhile the overall bias remains bearish, the Pound is seeing a recovery off recent lows, particularly after a bounce from 1.31804. The MACD is gaining bullish volume, the RSI shows building momentum, and price has broken above the EMA200, hinting at a potential shift in sentiment. We remain cautious but acknowledge a possible reversal if momentum sustains.

AUDUSDThe Aussie has shifted back to a bullish stance after breaking out of previous structure, placing it in a wider consolidation zone. Both the MACD and RSI reflect growing buying momentum, and we expect continued upside in the short term, especially if risk sentiment stays positive.

NZDUSDThe Kiwi is in consolidation, but technical indicators are turning bullish. The MACD and RSI show growing upside momentum, suggesting further buying ahead. However, like the Aussie, this pair remains range-bound, requiring a confirmed breakout for stronger directional conviction.

EURUSDDespite recent gains, the Euro's rally appears to be a retracement within a broader downtrend. The MACD shows increasing bullish volume, and the RSI is trending higher, but we view this as a move toward the EMA200 before a likely continuation lower, unless a sharp breakout invalidates the bearish setup.

USDJPYThe Yen is pulling back from recent highs and may be looking to fill a previous price gap. The MACD and RSI both point to building bearish momentum, with price nearing the EMA200. While this suggests more downside for the Yen, we note that the overall price structure remains bullish, keeping us open to renewed long opportunities depending on how this correction plays out.

USDCHFThe Franc is following a similar path to the Yen, with price approaching the EMA200 after filling a gap. The MACD and RSI signal increasing bearish momentum, indicating further short-term weakness. However, longer-term bullish structure remains intact, and we may see a rebound after this corrective phase.

USDCADThe Loonie has pulled back after reaching recent highs, with the MACD and RSI confirming increased bearish momentum. This move coincided with the unveiling of Mark Carneys new cabinet, particularly the appointment of former Goldman Sachs banker Tim Hodgson as Natural Resources Minister.

“Mark Carney campaigned on building, and his choice for natural resources shows that he is serious about building resources in Canada,” said Adam Button, chief currency analyst at ForexLive.

“I think it's the most important cabinet pick today... It's a great signal for the loonie.”

While the new government seeks to shift Canadas economic focus away from U.S. dependence, this transition may come with short-term volatility for the CAD. We expect continued pressure on the Canadian dollar in the near term.