US 100, EURUSD, GBPUSD

US-China trade talks and US CPI --> US 100

The US and China concluded high-stakes trade talks positively on Sunday, with US officials announcing a "deal" to reduce the trade deficit and Chinese officials highlighting "important consensus" and the launch of a new economic dialogue forum. Details were scarce, but a joint statement is expected in Geneva today. Wall Street stock futures rose, and the dollar strengthened against safe-haven currencies, reflecting optimism that a global recession might be avoided. Geopolitical tensions eased with a fragile ceasefire between India and Pakistan, while Ukrainian President Zelensky expressed readiness to meet Putin in Turkey for talks. Meanwhile, the US CPI is anticipated to show a 0.3% m/m increase, maintaining a yearly rate of 2.4%, with Core CPI also rising by 0.3% m/m and staying at 2.8% y/y.

The US 100 (cash) index has posted a bullish gap with the price skyrocketing above the 200-day simple moving average (SMA) and the strong 20,300 barrier, giving the green light for more extensions. The next resistance could come from the 21,320 level and the all-time high of 22,236. Alternatively, a move below the 20,165-20,300 support region may open the way for another bearish wave until 19,000. MACD and stochastic confirm bullish momentum.

Eurozone GDP --> EURUSD 

The Eurozone GDP report for the first quarter of 2025 will be released on May 15, 2025. Preliminary data have indicated stronger-than-expected growth of 0.4% for Q1 2025, surpassing the previous of 0.2%. This growth has been driven by higher exports in anticipation of US tariffs and robust performance in southern European economies like Spain and Lithuania. However, economists expect growth to slow in the coming months due to the impact of US tariffs introduced in April.

EURUSD opened with a negative gap today, sending the price aggressively lower with the first support coming from the 50-day SMA at 1.1075. If the bulls overcome the 1.1275 line and the 20-day SMA at 1.1335, the next key level would be at 1.1420. Even higher, the three-and-a-half-year high of 1.1572 could be the trigger point for more increases. However, the technical oscillators are still suggesting a bearish move. 

UK GDP --> GBPUSD

The UK GDP report for March is expected to show  modest growth of around 0.0% .This follows a 0.5% increase in February, driven by strong performance in the services sector, manufacturing, and exports. However, challenges such as the cost of living crisis and external geopolitical tensions continue to pose risks to sustained economic recovery. 

The recent US-UK trade talks have culminated in a historic agreement announced by President Donald Trump and UK Prime Minister Keir Starmer. This deal resets US tariffs on most UK goods to 10%, while eliminating tariffs on UK steel and aluminum. The agreement is expected to generate $6 billion in revenue for the US and create $5 billion in new export opportunities. The UK will also lower tariffs on US goods to 1.8% from 5.1%, enhancing access to US products in UK markets. This trade deal marks a significant step in strengthening economic ties between the two nations and is anticipated to boost trade and job creation on both sides. 

GBPUSD is tumbling below the support area of 1.3208-1.3250 with the potential for reaching the 1.3100 round number. Moreover, a decline below this line may open the way for a test of the medium-term uptrend line at 1.2980. On the other hand, an upside recovery could send investors toward the mid-level of the Bollinger band at 1.3300.