empty
25.02.2025 09:49 AM
Markets at a Crossroads: Key Factors to Watch (Possible Local Decline in Gold Prices and Rise in Crude Oil Prices)

After the markets reacted to the news of the U.S.-Russia negotiation process that was initiated following Donald Trump's call to Vladimir Putin, investors have shifted their focus back to the U.S. trade wars with several countries.

Initially, there was optimism regarding improved U.S.-Russia relations; however, the reality that Trump remains the key decision-maker proved less promising. On Tuesday, the U.S. dollar index (ICE) strengthened to 106.7, recovering from an 11-week low. This rebound followed Trump's announcement that tariffs on Canada and Mexico "will be imposed" after a one-month extension expires next week. Hopes that these two countries could negotiate a resolution with Trump's administration faded after his follow-up comments, prompting markets to adjust their expectations accordingly.

Market participants are now focusing on the upcoming PCE Price Index report and the second revised estimate of Q4 GDP, which could offer further clarity on the direction of monetary policy.

Last week, the U.S. Services PMI unexpectedly fell to 49.7 from 52.9, despite strong growth in the manufacturing sector. Additionally, consumer sentiment from the University of Michigan weakened notably due to concerns over persistent inflation, which could continue to rise given Trump's protectionist stance.

Against this backdrop, U.S. stock markets still lack a clear directional trend. The only assets showing a distinct movement have been the U.S. dollar on Forex and gold prices. The dollar declined due to uncertainty about future Federal Reserve policy, while gold prices surged as investors sought safe-haven assets. In response, SPDR Gold Trust, the world's largest gold-backed ETF, reported that its holdings increased to 904.38 tons on Friday—the highest level since August 2023.

What to Expect in the Markets Today?

I expect that both the U.S. stock market and the cryptocurrency market will remain in a consolidation phase, moving within sideways ranges. The dollar may experience a temporary rebound on the ICE index, reaching 106.75, but this should not be seen as a trend reversal. This week's market focus will be on the PCE index report, which is a key factor in the Fed's interest rate decisions, as well as the second estimate of Q4 2024 GDP.

This image is no longer relevant

This image is no longer relevant

Forecast of the Day

GOLD

Gold prices remain near their historical high, but due to overbought conditions, a local decline to $2,903.00 is possible if the $2,932.70 level is breached.

CRUDE OIL (WTI)

The price of U.S. crude oil (WTI) remains in the $70.30–$73.50 range and may continue fluctuating within this range for some time. This is due to the current market balance between supply and demand. Given this equilibrium, a short-term upward move to the upper boundary of the range is likely.

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

AUD/USD. RBA Delivers Dovish Scenario, but It's Too Early to Rush into Selling

The Reserve Bank of Australia (RBA) followed the most expected scenario at its May meeting, cutting the interest rate by 25 basis points. However, AUD/USD sellers remain vulnerable

Irina Manzenko 11:44 2025-05-20 UTC+2

Financial Markets Still Gripped by Uncertainty (Potential Decline in #USDX and Gold Prices)

Despite the 90-day truce between Beijing and Washington, market conditions remain extremely tense. Investors are uncertain about what will happen after three months—whether Donald Trump will hike tariffs again

Pati Gani 09:42 2025-05-20 UTC+2

The Market Ignores Warning Signs

When a crowd identifies a leader, it relentlessly pushes forward, clearing everything in its way. Retail investors heeded Morgan Stanley's call to "buy the dip" and began snapping up U.S

Marek Petkovich 09:11 2025-05-20 UTC+2

GBP/USD Overview – May 20: The British Pound Keeps Basking in the Sunlight

The GBP/USD currency pair traded higher on Monday, and we can "thank" the Moody's rating agency for that. As noted in the EUR/USD review, the U.S. credit rating was downgraded

Paolo Greco 07:31 2025-05-20 UTC+2

EUR/USD Overview – May 20: Fearless Moody's and a New Blow to the Dollar

The EUR/USD currency pair found a reason to resume its decline on Monday. As mentioned before, the U.S. dollar's position looks very shaky. It had risen for over a month

Paolo Greco 07:31 2025-05-20 UTC+2

What to Pay Attention to on May 20? A Breakdown of Fundamental Events for Beginners

There are no macroeconomic events scheduled for Tuesday, so the macroeconomic background will have no influence on price movements today. However, reports and data releases have rarely impacted currency pairs

Paolo Greco 06:02 2025-05-20 UTC+2

The Fed Allows Only One Rate Cut in 2025

The Federal Reserve continues to remain silent this year. While the European Central Bank has already cut interest rates three times and the Bank of England twice, the FOMC

Chin Zhao 00:40 2025-05-20 UTC+2

AUD/USD. RBA May Meeting: Preview

The Reserve Bank of Australia (RBA) will conclude its meeting on Tuesday, May 20, which may result in a softening of monetary policy parameters. The "dovish" scenario is the most

Irina Manzenko 00:40 2025-05-20 UTC+2

The Dollar Has Sold America Out Completely

Overall, the strength of the EUR/USD uptrend remains intact. The erosion of confidence in the U.S. dollar outweighs the divergence in monetary policy between the Fed and the ECB. Technical

Marek Petkovich 00:40 2025-05-20 UTC+2

AUD/USD. Analysis and Forecast

Spot prices for the AUD/USD pair remain within the familiar range held over the past month, as traders await a fresh catalyst before committing to the next directional move

Irina Yanina 18:22 2025-05-19 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.