Dollar Firms as Labor Market Defies Macro Headwinds

*U.S. dollar edged higher as strong April jobs data tempered near-term Fed cut bets, lifting Treasury yields modestly.

*Equities were mixed, with tech-led gains offset by broader caution as investors reassessed the timing of the Feds policy pivot.

*Oil held above $60 on OPEC+ support, while gold eased as safe-haven demand waned following resilient U.S. labor prints.

Market Summary

Markets traded mixed on Friday as investors digested stronger-than-expected April U.S. jobs data, which offered tentative relief following a week of downbeat economic prints. Nonfarm payrolls rose by 177,000—beating expectations of 130,000—while the unemployment rate held steady at 4.2%. Solid hiring in healthcare and logistics offset a decline in federal jobs, suggesting the labor market remains resilient despite macro headwinds. Average hourly earnings rose 0.2%, keeping annual wage growth at 3.8%, consistent with slowing but sticky inflation.

Equities hovered near recent highs, with the NASDAQ 100 extending gains on momentum from tech earnings. However, broader risk sentiment stayed cautious, as investors weighed whether todays report reduces the urgency for Fed rate cuts or simply delays the pivot.

The U.S. dollar firmed modestly, with the DXY holding just above 100.00 as rate cut bets were pushed further into H2 2025. Treasury yields ticked higher post-NFP, reflecting diminished odds of a near-term dovish shift. However, market focus remains on upcoming CPI and Fed commentary for confirmation.

In commodities, oil prices held above $60 on supportive supply-side headlines from OPEC+, while gold slipped slightly as traders reduced defensive positioning.

With April‘s jobs data clearing a key hurdle, markets turn to next week’s inflation readings and Fed Chair Powells remarks for clarity on the policy path. For now, NFP data appears to validate the “soft landing” narrative—but volatility remains tethered to trade rhetoric and geopolitical risk.

Current rate hike bets on 7th May Fed interest rate decision:

0 bps (92.3%) VS -25 bps (7.7%)

Source: CME Fedwatch Tool

Market Movements

DOLLAR_INDX, H4

The Dollar Index briefly surged above the critical 100.00 resistance level following Friday's stronger-than-expected U.S. nonfarm payrolls report, which showed job gains of 177,000—significantly above consensus forecasts. The robust labor data bolstered expectations that the Federal Reserve may maintain a hawkish policy stance, in contrast to President Trump's recent calls for rate cuts. U.S. Treasury yields continued to rise in response, lending further support to the greenback's strength.

The dollar index continues to trade within a higher-high price pattern, suggesting a bullish bias for the index. The RSI remains at above 50 level while the MACD remains at above the zero line, suggesting that the index remains bullish.

Resistance level: 101.40, 104.25

Support level: 99.10, 96.35

XAU/USD, H4

Gold prices edged lower as risk appetite improved following better-than-expected U.S. Nonfarm Payrolls, which came in at 177K vs. 138K expected, suggesting ongoing labor market strength. Sentiment was further supported by President Trump‘s comments on China, where he signaled willingness to lower tariffs, acknowledging that high levies have effectively stalled trade between the two nations.

Gold prices are trading flat while currently consolidating in a zone between support and resistance level. MACD has illustrated increasing bullish momentum, while RSI is at 49, suggesting the gold might tilt toward bullish bias, but improving risk appetite might weigh on gold prices.

Resistance level: 3270.00, 3355.00

Support level: 3200.00, 3110.00

Crude Oil, H4

Crude oil came under pressure as OPEC+ approved another large output increase, adding more than 400,000 barrels per day in June—mirroring Mays unexpected hike. The move raised concerns about a global supply glut, particularly as demand faces headwinds from ongoing trade tensions. OPEC+ also shifted focus to penalizing overproduction from members like Kazakhstan, adding further instability to the market. The rollback of prolonged output curbs has cost the group market share, and the price reaction has been bearish.

Oil prices are trading lower while currently testing the support level. MACD has illustrated increasing bearish momentum, while RSI is at 31, suggesting the commodity might extend its losses since the RSI stays below the midline.

Resistance level: 65.25, 71.75

Support level: 55.35, 52.20