DBG Markets: Market Report for Mar 6, 2025

Market Overview

GOLD - Gold prices remain high but consolidated after Trumps imposition of tariffs. The initial reaction of the market was to push U.S. prices upward as the inflationary effect of these tariffs is evident. However, it brought with it another conflict—the intensification of trade wars between countries. 

SILVER - Prospects for growth in gold prices carry silver price expectations upward. We can see in the chart that the MACD is moving upward, although the volume is a bit muted. But price action does not show this, as it is steadily moving upward. This means that volume for bullish sentiment is very strong at the moment. The RSI is also remaining at the lower levels, showing that the momentum for buying is extremely strong at the moment. We look for more bullish opportunities in this market as the shift for a buy has already happened and it has broken above 32.5177.

DXY - The dollar is seeing a big drop in price after worries for the U.S. economy arise. There is a slowdown in U.S. jobs data and payrolls. U.S. private payrolls growth slowed considerably in February, data released on Wednesday showed, indicating that the labor market is cooling off.

The private payrolls data follows a string of disappointing data, including a slump in U.S. consumer confidence in January, along with a steep decline in retail sales. Monday's U.S. manufacturing activity data showed big falls in new orders and employment.

"Markets have seemingly shifted their focus away from tariff rhetoric for now, and they appear to be concerned about a slowdown in the U.S. economy," MUFG Bank said in a note.

Why did they remove the tariff rhetoric？ Because it may not be enough to speed things up for the economy, especially if inflation remains high due to Trumps policies.

Technically, we can see the markets dropping fast with price action heavily leaning to the sell. The MACD remains consistent with the bearish volume, and the RSI remains at the upper levels, showing no apparent slowdown in momentum. Thus, we remain looking for selling opportunities with the dollar.

GBPUSD - The pound has set off with a blast, rising above 1.28508 with strength contrary to our initial expectations. The MACD is reflecting muted volume but shows strength in the buying when compared to price action. The RSI is also showing potential for further growth. Thus, we remain looking for more buying opportunities. Only that today, there might be a small hiccup and a potential pause in the rise for a short consolidation. Otherwise, we can expect it to rise further.

AUDUSD - The Aussie dollar sees increased strength against the dollar after its weakness. Risk-on assets start to increase after the dollar lacked appeal. The MACD shows continuation with the growth in volume, and the RSI continues to consolidate and remain under despite the rise, showing growth with momentum bullish. Thus, we remain looking for more buying as the overall price action has long shifted back to bullish.

NZDUSD - The Kiwi has also shifted back to overall price momentum bullish. The MACD is showing consistent volume growth for the buying while the RSI remains under despite the strong buying with price. We can expect to see continuation.

EURUSD - Euro prices rise considerably after it stayed between the consolidation zones. The MACD and the RSI are seeing considerable growth. Investor focus on Thursday will be on the European Central Bank meeting, where it is widely expected to cut interest rates again as policymakers contend with trade war woes and a rearmament focus in the region.

USDJPY - The Yen consolidates further even with the Dollars poor performance. The market is clearly discounting further BOJ rate hikes with more eyeing earlier tightening. Probability studies still suggest near-zero chance of a move this month but are much higher for the May Policy Board meeting and beyond. This causes the lowered movement with the Yen and the weakness it is showing in the market. There will be no changes in our reading for as long as markets remain consolidated. Although it did make a new lower high, it remains underperforming.

USDCHF - The Franc is currently sideways and is looking to bounce back up. This was contrary to expectations, as in times of uncertainty, the Franc is held to be one of the most stable backers for markets. However, it is underperforming right now.

USDCAD - The CAD is seeing increased selling momentum after markets show potential to sell further, crashing under the previous higher swing low and shifting overall price action to sell. If prices remain under, it will complete the shift.