The fall of the US dollar on Monday helped support overseas currencies including safe-haven currencies such as the Japanese yen and the Swiss franc, as investors sold off US assets under Donald Trump’s policies – a trend that jpmorgan Chase expects to continue.
The Bloomberg Dollar Spot Index dropped 0.5% as the trade deal failed to make progress and has fallen nearly 7% so far this year. The disappointing manufacturing activity report released on Monday has intensified concerns about the growth of the US economy and put pressure on the US dollar. Other safe-haven currencies such as the Japanese yen and the Swiss franc rose by approximately 1% on that day. The pound jumped to its highest level in three years.
Meera Chandan, co-head of global foreign exchange strategy at jpmorgan Chase, said in an interview: “We expect the US dollar to experience a second wave of weakness.” This is a cyclical transformation that will last for several quarters.
President Trump’s trade policies and his tough remarks towards China have prompted investors to start purchasing large amounts of assets outside the United States. From January 20th (when Trump returned to the White House) to April 28th, another indicator measuring the US dollar dropped by approximately 9% and is expected to record the biggest decline at the end of this month since at least 1973.
Data from the U.S. Commodity Futures Trading Commission (CFTC) shows that in the week ending April 22, speculative traders, including hedge funds and asset management companies, increased their short bets on the U.S. dollar. This is the largest short position in the US dollar since September 2024. Long-term investors will also join the ranks of withdrawing funds from the United States for reallocating, as they adjust their strategies less frequently. The withdrawal means that the US dollar will weaken over a longer period of time.
Qian Dan of jpmorgan Chase said that the policies of the Trump administration are undermining the American exceptionalism, which has been a theme supporting the market in the past few years.
“The two pillars of the US economic growth – immigration and finance – are tightening,” she said. Due to inflation caused by tariffs, the real policy interest rate in the United States is further falling into negative territory.
U.S. Treasury yields fell across the board on Monday as traders responded to the update of U.S. trade policy and hoped to get more guidance from this week’s U.S. labor market report. The yield on the 10-year Treasury note dropped to 4.2%.
Technical analysis
Gold: Yesterday, the price first dropped to around 3,270, and after stabilizing near the demand zone in the early Asian session, it strengthened. The green area reminded in our plugin yesterday is the demand area. After entering the offshore market, the price broke through the blue area upwards. After touching the 3333 level we warned of, it retraced and confirmed that it continued to strengthen. During the day, we should pay attention to the price retracting to the demand zone around 3,300 and keep an eye on the buy signal. For detailed location, please consult the plugin.
(Gold 15-minute Chart
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The Nasdaq: The overnight price did fall back to seek new buying strength, but it rebounded after dropping to around 19,200. At present, strong buying has not yet emerged, so we will maintain low buying and rebound buying after clearing the liquidity below. For detailed location, please consult the plugin.
(15-minute chart of the Nasdaq
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Crude oil: Due to Trump’s 90-day suspension of full reciprocal tariffs, the pressure on oil prices from recession concerns has been greatly alleviated. The scenario we wanted yesterday where we would buy after breaking through the blue area did not occur. It is recommended to be patient on the day and wait for the price to recover to 62-62.30 before considering a buy signal. For detailed location, please consult the plugin.
(Crude oil 15-minute chart
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Key financial data and events to focus on today:
At 17:40, the deputy governor of the Bank of England, Ramsden, delivered a speech
22:00 Conference Board Consumer Confidence Index for April in the United States
22:00 JOLTs job Vacancies in the US for March (10,000)
At 22:00, the Governing Council Member of the European Central Bank, Holzmann, delivered a speech
