FX Weekly Overview (Brazil Issue)
Dollar to reflect US economic data, Central Bank minutes, inflation in Brazil, and the Middle East
Leonel Mattos
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Gold Hits $3,500 as Dollar Slides and Trade Tensions Ease
By: Gustian Farrow, Head of StoneX TV • Content Channels
Gold Hits $3,500 as Dollar Slides and Trade Tensions Ease
Amid signs of easing trade tensions between the US and China, markets have rebounded from extreme levels, prompting traders to reassess technical outlooks across key assets. Razan Hilal, Market Analyst at FOREX.com, breaks down the most critical levels across currency pairs, commodities, and equities.
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Key Takeaways
- EUR/USD holds above 1.14 with potential to target 1.20 amid dollar weakness
- Gold could push toward $4,000 if safe-haven flows persist
- S&P 500 must hold above 5,400 to confirm bullish recovery
EUR/USD Benefits from Dollar Retreat
The euro has rallied off the back of a weakening US dollar, driven in part by shifting trade rhetoric and global tariff risks. Hilal noted that EUR/USD is trading above 1.14, with potential resistance levels at 1.16 and 1.20. She flagged 1.17 and 1.20 as key targets, should the dollar continue to weaken. However, a pullback to 1.12 or 1.11 remains possible if market sentiment sours again.
Gold’s Bullish Case Strengthens
Gold reached a record high of $3,500 before retreating to the $3,300–$3,290 support zone. Hilal pointed out that despite short-term volatility, the metal could continue its climb toward the $4,000 mark if safe haven demand persists. The crucial area to watch is $3,290; a drop below could see a move toward $3,100 or $2,800.
USD/JPY at a Critical Juncture
The Japanese yen has also gained from recent risk-off sentiment. The USD/JPY pair tested major support near 139–140, the 61.8% Fibonacci retracement of the 2020–2024 uptrend. Hilal suggested that a drop below this zone could signal further dollar weakness, with Japanese inflation data being a key event to monitor later this week.
S&P 500 Clings to Gainsl
US equities, particularly the S&P 500, have shown resilience, rebounding toward the 5,400 level. Hilal highlighted this as a potential confirmation zone for further upside. However, uncertainty remains, and failure to hold could lead to a retracement toward 4,800. These levels may define the market’s direction for the remainder of 2025.
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---- Written by Gus Farrow
---- Expert: Razan Hilal, CMT, FOREX.com Market Analyst
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