Insights 
VT 
Equity markets are starting the week cautiously optimistic as a confluence of diplomatic breakthroughs, trade progress, and global de-escalation provides fresh fuel for risk sentiment. After months of volatility and headline fatigue, the combination of new trade deals, emerging ceasefires, and economic diplomacy is offering traders a rare window of calm—at least for now.
President Trump’s renewed push for market confidence was the most prominent driver. His recent remarks urging Americans to “buy now” ahead of what he describes as a major economic boom have caught investor attention. Citing progress on both the U.S.-UK trade agreement and ongoing talks with China, Trump painted a picture of an economy on the verge of renewed expansion. The White House claims the UK deal alone could unlock $6 billion in tariff revenues and $5 billion in new export flows—figures designed to justify the current rally.
While the UK trade agreement has already gone into effect—offering tariff exemptions on key goods like aluminum and steel—the U.S.-China dialogue remains in motion. Trump referred to last week’s talks in Switzerland as a potential “total reset,” aiming to ease the ongoing tariff war while opening Chinese markets to American firms. So far, nothing has been formalised, but the market is trading on the hope that a de-escalation in tariffs could follow.
Beyond the trade arena, geopolitical developments are also playing a supportive role. A ceasefire between India and Pakistan, though still fragile, has reduced near-term risk in a historically volatile region. Similarly, Russia’s call for direct talks with Ukraine has sparked fresh optimism over the long-running Eastern European conflict. Even with some violations reported shortly after the India-Pakistan ceasefire announcement, traders appear more focused on the broader shift toward diplomacy than the short-term setbacks.
Price Movements of the Week
This week’s price movements have unfolded under the shadow of geopolitical easing and central bank watchfulness. From commodities to currency pairs and equity indices, traders are now positioning themselves with sharper eyes on structural patterns and key levels, as they seek clarity amid shifting macro themes. While optimism has returned in pockets, especially with the softening of global tensions and upbeat trade headlines, the charts are signalling an important transitional phase—neither fully risk-on nor overtly defensive.
The U.S. Dollar Index (USDX) slipped from the 100.60 zone, a previously monitored resistance area. The dollar’s retreat comes ahead of U.S. inflation data, with CPI forecast at 2.4% and Core CPI at 2.8%. This data could be pivotal in confirming whether the dollar’s corrective rally has reached its peak. Should the index consolidate near current levels, a retest of 102.00 remains in view. However, traders are eyeing bearish patterns at that zone, which could cap further upside if the data misses expectations.
EURUSD advanced from the 1.1200 region, a technical bounce that suggests a mild bullish undercurrent. If price consolidates at 1.1200, the path higher may strengthen. However, any pullback toward 1.0970 will be closely watched for renewed bullish entries. The euro’s move reflects both dollar softness and confidence around stabilising EU growth projections.
GBPUSD reversed its earlier weakness after breaking below the 1.32333 low. The pair has since recovered, though it remains in need of further bullish price action confirmation. Thursday’s UK GDP m/m, forecast at 0.0% versus 0.5% previously, could influence whether this rebound holds or fades. Traders remain cautious, especially with BOE Governor Bailey expected to offer insight on policy direction this week.
USDJPY surged higher in an impulsive move, reaching toward 146.60 and 147.40. Both zones are being closely monitored for signs of exhaustion or continuation. With U.S. yields stabilising and the Bank of Japan showing little inclination to tighten meaningfully, this pair could continue higher unless inflation prints undermine dollar strength.
USDCHF is tracking higher, testing the 0.8370 area. A move beyond this zone could set up a test at 0.8530, where traders are watching for bearish price signals. Swiss franc strength may emerge again if market risk reverses course, or if global safe-haven flows return following any geopolitical flare-ups.
AUDUSD rebounded from 0.6380, although the uptrend lacks conviction. Should the pair decline again, traders are eyeing 0.6260 as a key level for bullish price action. The Aussie’s performance this week remains sensitive to Chinese trade headlines and general risk sentiment.
NZDUSD followed a similar trajectory, rising from the 0.5870 region. Like AUDUSD, confirmation is lacking, and a decline would bring the 0.5800 support zone into focus for potential long setups. Commodity-linked currencies may find more direction once U.S. inflation and China trade negotiations provide clearer signals.
USDCAD is trading at the 1.3945 level, and consolidation here could lead to resistance tests at 1.4055 and 1.4140. The Canadian dollar’s strength has been partially anchored by higher oil prices, though oil itself faces resistance in the near term.
USOIL is edging higher, approaching the 62.05 resistance zone. If momentum carries it further, 63.15 will become a critical level where bearish pressure may build. With ceasefires and diplomatic overtures dampening geopolitical risk premiums, crude’s upside may soon be limited—unless supply disruptions re-enter the narrative.
Gold continues to move lower, in line with a cooling inflation outlook. Traders are watching the 3,230 zone for possible support. If gold consolidates there, the 3,120 level becomes the next area of interest. The metal’s bearish bias may remain intact unless U.S. inflation data surprises to the upside or geopolitical risk suddenly resurges.
Silver fell from the 33.20 area and may now test the 31.657 or even 30.95 levels before bulls show renewed interest. Like gold, silver is tracking broader risk appetite and inflation trends, both of which are showing tentative softening.
Bitcoin neared its all-time high this week, driven by renewed optimism and positive macro developments. If the rally pauses to consolidate, traders will monitor the 99,600 zone for fresh bullish patterns. Ether outpaced Bitcoin with an 18.91% rise across Friday and Saturday, having broken above 1,900. The next levels in focus for ETH are 2,340 and 2,780, depending on momentum and investor appetite.
The S&P 500 continued its climb, with upcoming price action zones at 5,775 and 5,830. These levels represent potential resistance areas where the index may stall or break higher, contingent on this week’s inflation figures and Fed Chair Powell’s Thursday remarks. Nasdaq followed suit, now within range of 20,560 and 21,230, where traders will be seeking signs of fatigue or breakout.
Natural Gas made a new swing high and is now likely to consolidate. A pullback to 3.50 may offer bullish re-entry opportunities. Market participants continue to assess seasonal demand alongside broader commodity flows.
Nvidia remains on track toward the 120.40 level. With its intrinsic value estimated at $130, traders are tracking its movements closely. Amazon is similarly advancing, heading for 195.80, while Microsoft remains poised to break through 448.30 and potentially 456.03, contingent on consolidation patterns.
Across the board, price action this week reflects a market walking the line between optimism and uncertainty. With key inflation data and central bank speeches on the docket, these structural zones will guide short-term momentum, while traders wait for confirmation that calm abroad and cooling inflation at home can form the basis of a steadier risk-on trend.
Key Events of the Week
On Tuesday, May 13, the focus turns sharply to inflation and monetary policy, with both the U.S. and UK releasing market-relevant updates. In the U.S., CPI y/y is forecast to remain unchanged at 2.4%, while Core CPI y/y—which excludes food and energy—is expected to come in lower than the previous 2.8%. Markets are watching closely for any sign that inflation is cooling faster than expected, which could reinforce hopes for a shift in Federal Reserve policy later in the year. On the same day, Bank of England Governor Andrew Bailey is scheduled to speak. With the UK economy treading water and inflation coming down, traders will be parsing Bailey’s comments for guidance on future interest rate decisions. Sterling pairs could react sharply if his tone diverges from expectations, especially with Thursday’s GDP figures looming.
On Thursday, May 15, a trio of high-impact events takes centre stage. In the UK, GDP m/m is forecast at 0.0%, down from the previous month’s 0.5%. A flat growth reading would add weight to concerns about the UK’s post-Brexit economic momentum and could weaken the pound if paired with dovish signals from Governor Bailey earlier in the week. Across the Atlantic, the U.S. is due to release PPI m/m data, forecast to rise by 0.2% following last month’s -0.4% drop. A stronger PPI print would suggest rising production costs, possibly hinting at future consumer inflation pressure and complicating the Fed’s outlook. Later in the day, Federal Reserve Chair Jerome Powell is expected to speak. With inflation data in hand and markets already pricing in slower growth ahead, his words could sway expectations sharply. A cautious tone may support equities and weigh on the dollar, while a firmer stance could reassert the Fed’s commitment to keeping rates elevated for longer.
The week ahead offers fewer distractions from global diplomacy, but sharper scrutiny on economic direction. As traders weigh inflation data against central bank rhetoric, positioning will hinge on whether macro signals support the easing narrative—or suggest that policy tightening may still have work to do.
