ATFX Market Outlook 2nd April 2025

ATFX Market Outlook 2nd April 2025

Trump's Reciprocal Tariff Announcement Looms: Markets Brace for Impact

Market HighlightU.S. manufacturing contracted in March after two months of growth. The S&P 500 and Nasdaq closed higher on Tuesday, while market sentiment remained cautious ahead of the Trump administration’s tariff announcement. The Dow Jones dipped 0.03%, while the S&P 500 gained 0.38%, and the Nasdaq rose 0.87%.

Economic data showed weakness in manufacturing and the labor market, while the U.S. will announce reciprocal tariffs on Wednesday. The U.S. Dollar Index was flat at 104.25, USD/JPY fell 0.37% to 149.41, and EUR/USD declined 0.29% to 1.0786.

Gold prices retreated slightly on profit-taking but remained near record highs as investors sought safe-haven assets ahead of Trump’s tariff announcement. Spot gold fell 0.4% to $3,110.55 per ounce after hitting an all-time high of $3,148.88. Oil prices declined as traders worried that the upcoming tariff measures could escalate global trade tensions.

Key OutlookThe U.S. government will announce a series of reciprocal tariffs targeting key trade partners. While Trump has hinted at a more flexible approach, markets remain on edge over potential disruptions.

Later today, the U.S. will release the March ADP Employment Report, with forecasts at 105K (previous: 77K). A stronger private sector hiring trend is crucial for maintaining confidence in the U.S. economy.

Key Data and Events Today:

20:15 US ADP Employment Change MAR *** 

22:00 US Factory Orders FEB ** 

22:05 ECB’s Schnabei Speak ** 

Tomorrow

03:00 US President Trump Speaks *** 

09:45 CN Caixin Services & Composite PMI MAR ** 

15:55 EU GERMANY Services & Composite PMI MAR ** 

16:00 EU Services & Composite PMI MAR ** 

16:30 GB Services & Composite PMI MAR ** 

17:00 EU PPI FEB ** 

18:00 OPEC Meeting ***

20:30 US Initial Jobless Claims *** 

22:00 US Services PMI MAR *** 

EURUSD

· Resistance: 1.0843 / 1.0869

· Support: 1.0757 / 1.0731

EUR/USD remained near 1.0800 as investors awaited Trump's tariff announcement, the details of which are still unclear. US ISM PMI fell unexpectedly, while upcoming Nonfarm payroll data could signal the impact of tariffs on the economy.

GBPUSD

· Resistance: 1.2959 / 1.2976

· Support: 1.2885 / 1.2868

GBP/USD remained flat above 1.2900 as investors awaited U.S. President Trump's tariff announcement. Weaker-than-expected ISM Manufacturing PMI took a backseat amid geopolitical uncertainty. The focus now shifts to the upcoming U.S. Nonfarm Payrolls (NFP).

USDJPY

· Resistance: 150.03 / 150.47

· Support: 148.97 / 148.62

JPY strengthened on Tuesday, driven by its safe-haven appeal and expectations of a US tariff announcement. The USD struggled amidst fears that Trump's tariffs could harm the US economy, while the JPY benefited from rising speculation that the Bank of Japan may raise interest rates in May.

US Crude Oil Futures (MAY)

· Resistance: 71.68 / 72.06

· Support: 70.43 / 70.05

WTI crude rises to $70.95 on supply concerns from Trump’s tariff threats, but looming US tariffs may cap gains. API reports a 6.037M barrel stock increase, while OPEC+ plans a 135,000-bpd output hike. Geopolitical risks support prices, but rising inventories add pressure.

Spot Gold

· Resistance: 3138 / 3145

· Support: 3101 / 3094

Spot Silver

· Resistance: 34.00 / 34.24

· Support: 33.44 / 33.25

Gold dipped to $3,114 as traders awaited Trump’s tariff announcement. US data signaled economic weakness, with ISM PMI falling and recession risks rising. Bond yields dropped, while banks raised gold targets to $3,300. Pay attention to ISM Services PMI, NFP, and Powell’s speech.

Dow Futures

· Resistance: 42572 / 42833

· Support: 41488 / 41233

The Dow Futures dropped after weaker US PMI data but recovered as investors speculated on potential Fed rate cuts. Markets are awaiting President Trump's tariff announcement. The US March ISM Manufacturing PMI indicated a fall, signaling caution.

NAS100

· Resistance: 19724 / 19858

· Support: 19158 / 19027

As investors assess Trump’s tariff plan, U.S. stocks remain volatile. The NAS100 has rebounded above 19,400 but faces key resistance near 19,700, where a tariff announcement could trigger a pullback.

BTC

· Resistance: 87383 / 88784

· Support: 82702 / 81266

Bitcoin rebounded after a brutal Q1 2025, where it lost 11%. This came amid speculation on Trump’s trade tariffs and his Bitcoin mining investment, but it underperformed compared to major indices, with Trump’s crypto policies offering little price support.

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