empty
23.05.2025 10:19 AM
Market Chaos to Continue (There is a likelihood of continued local declines in #USDX and gold prices)

Markets continue to act blindly amid the chaotic actions of Donald Trump, who is trying to pull the U.S. out of a deep, all-encompassing crisis like Baron Munchausen pulling himself out of a swamp by his own hair.

Investors appear to have accepted that the chaotic period initiated by the U.S. president, both geopolitically and economically, will continue indefinitely. There is no longer any doubt among rational observers that America and the broader Western world have entered a phase of declining geopolitical and economic influence. Trump's constant maneuvering, transparent attacks on trade partners for economic leverage, and tax policy changes that defy common sense are the primary drivers of heightened market volatility.

In such an environment, market participants cannot rely on the development of sustainable trends. Traders interpret the landscape as short-term and local — buy today, sell tomorrow. Rumors, headlines, and statements from the 47th President are treated as triggers for short-term speculative trades. Traders have significantly stopped responding to macroeconomic data, which I have not witnessed in my 26 years in the profession.

Gold, the classic barometer of geopolitical and economic fear, clearly reflects this reality. On the weekly chart, gold has entered a chaotic sideways range following a sustained uptrend that began in autumn 2023. The daily chart shows a short-term downtrend forming, with a strong resistance level around 3358.50. The market's failure to breach this level shapes a "descending flag" — typically a continuation pattern within an uptrend. However, whether the uptrend in gold will continue remains unclear due to the overarching uncertainty over markets. That same uncertainty could drive the price down to the lower boundary of the flag, around 3100.00.

Concerns over compliance with the 90-day tariff truce between China and the U.S., the growing budget deficit due to lower tax revenues, and persistent volatility are forcing investors to approach capital allocation cautiously.

Additional risks include the possibility of rising inflation in the U.S. amid tax cuts and the lingering threat of a recession.

Markets have been in chaos for several weeks, with no clear probabilities for how events may unfold. This instability continued yesterday amid an unexpected sell-off of government bonds across major markets, reinforcing the idea that the only viable trading tactic remains "grab and run."

What Can Be Expected Today?

The current situation will likely persist for a prolonged period. The primary market strategy will continue to prioritize short-term speculation instead of long-term positioning.

This image is no longer relevant

This image is no longer relevant

Daily Forecast

#USDX

The dollar index is currently trading above 99.40. Continued pressure on the dollar may result in a decline toward 98.85, particularly after it breaks below that level. A possible entry point for short positions could be 99.35.

Gold

Gold is trading within a short-term downtrend and may resume its decline. Failure to break above 3358.50 could trigger a renewed drop toward 3263.75. A potential sell level is 3322.42.

Pati Gani,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

Is This the Right Time for Christine Lagarde to Leave Her Post?

While the euro shows no intention of yielding to the U.S. dollar, Christine Lagarde is about to face criticism over her intention to continue leading the European Central Bank

Jakub Novak 13:35 2025-06-04 UTC+2

USD/CAD. Analysis and Forecast

The USD/CAD pair remains in a sideways consolidation near its lowest levels since October 2024. Market participants are awaiting the Bank of Canada's interest rate decision, which will be announced

Irina Yanina 09:57 2025-06-04 UTC+2

The Stock Market Believes Trump's Tariff Game Won't Have a Major Impact (Growth in #NDX and #SPX CFDs May Continue)

After a sharp, almost catastrophic drop in March and April, the major U.S. stock indices recovered in May, fully offsetting the decline. Confidence is growing among market participants that this

Pati Gani 09:53 2025-06-04 UTC+2

The Market Is Playing a Dangerous Game

Is the market only hearing what it wants to hear? Or is it simply playing the "buy the dip" game? According to Nomura, buying the S&P 500 five days after

Marek Petkovich 09:27 2025-06-04 UTC+2

What to Pay Attention to on June 4? A Breakdown of Fundamental Events for Beginners

There are not many macroeconomic reports scheduled for Wednesday. Of course, we should note the services sector business activity indices for Germany, the UK, the EU, and the US. However

Paolo Greco 07:27 2025-06-04 UTC+2

GBP/USD Overview – June 4: Trump Is Only Interested in the Big Fish

The GBP/USD currency pair traded lower on Tuesday, but the decline was weak, just like the volatility. Just look at the most recent stretch of the GBP/USD movement

Paolo Greco 03:41 2025-06-04 UTC+2

EUR/USD Overview – June 4: Words, Words... Where Are the Actions?

The EUR/USD currency pair traded relatively calmly throughout Tuesday, and the U.S. dollar even managed to gain slightly. However, we wouldn't pay much attention to a dollar rise

Paolo Greco 03:41 2025-06-04 UTC+2

The U.S. Economy Will Suffer More Than Others from Tariffs

Donald Trump is jeopardizing his own economy. This was the conclusion reached by the G-20 countries at their recent summit. According to summit participants, the discussions focused on the trade

Chin Zhao 00:28 2025-06-04 UTC+2

EUR/USD. Failed Assault on the 1.14 Level: Bears Retreat but Do Not Surrender

Buyers of EUR/USD started the trading week vigorously, testing the resistance level at 1.1450 (the upper line of the Bollinger Bands indicator on the daily chart) and updating a six-week

Irina Manzenko 00:27 2025-06-04 UTC+2

Euro: Trouble Has Arrived – Open the Gates!

Trouble came from where it was least expected. Frustrated by its coalition partners' refusal to support its immigration control plans, the Freedom Party dismantled the Dutch government. The country will

Marek Petkovich 00:27 2025-06-04 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.