{"id":112817,"date":"2025-06-02T11:27:24","date_gmt":"2025-06-02T08:27:24","guid":{"rendered":"https:\/\/ironfx-com.wp-dev.int.theitops.net\/?p=112817"},"modified":"2025-06-02T11:27:38","modified_gmt":"2025-06-02T08:27:38","slug":"escalating-trade-tensions-weigh-on-usd","status":"publish","type":"post","link":"https:\/\/www.ironfx-cn.com\/nl\/escalating-trade-tensions-weigh-on-usd\/","title":{"rendered":"Escalating trade tensions weigh on USD"},"content":{"rendered":"

The USD tended to edge lower against its counterparts during today\u2019s Asian session, as US President Trump announced late Friday evening that he intends to double aluminium and steel tariffs to 50% from Wednesday onwards. He also claimed that China backtracked from what was agreed in recent negotiations in Switzerland. China opposed accusations that the agreement about rare earth elements has been violated. The issue threatens to cancel any agreement. Overall tensions seem to be escalating and if actually intensify we may see the USD losing more ground as fundamentals seem to be leading the greenback. Today we get the US ISM manufacturing PMI figure and should the indicator\u2019s reading rise we may see the USD limiting its losses.<\/p>\n\n\n\n

Since Friday\u2019s report, EUR\/USD has been on the rise, especially during today\u2019s Asian session given the weakening of the USD, aiming for the 1.1425 (R1) resistance line. The RSI indicator seems to be edging slowly higher, implying some bullish predisposition of the market for the pair, yet for the time being we tend to maintain our bias for a sideways motion between the R1 and the S1 levels. For a bullish outlook to emerge we would require the pair to clearly break the 1.14250 (R1) resistance line and start aiming for the 1.1690 (R2) resistance level. For a bearish outlook to emerge, we would require the pair to break the 1.1210 (S1) support line and start aiming for the 1.0940 (S2) support level .<\/p>\n\n\n\n

Other highlights for the day:<\/strong><\/h2>\n\n\n\n

Today we get UK\u2019s nationwide house prices for May, Switzerland\u2019s GDP rate for Q1, the Czech Republic\u2019s PMI figure for May, Germany\u2019s, the UK\u2019s and Canada\u2019s final manufacturing PMI figures for May On the monetary front, we note that Dallas Fed President Logan, Chicago Fed President Goolsbee and Fed Chairman Jerome Powell are scheduled to speak. In tomorrow\u2019s Asian session, we get Australia\u2019s current account balance for Q1 and China\u2019s Caixin manufacturing PMI figure for May, while BoE MPC member Mann speaks and RBA is to release the minutes of the May meeting.<\/p>\n\n\n\n

On a technical level, we note that the Aussie was on the rise against the USD during today\u2019s Asian session, yet for the time being remains well within the boundaries set by the 0.6515 (R1) resistance line and the 0.6340 (S1) support level. Despite the RSI indicator edging higher today for the time being we tend to maintain a bias for the sideways motion to continue given also that the Bolinger bands remain flat. Should the bulls take over we may see AUD\/USD breaking the 0.6515 (R1) resistance line and start aiming for the 0.6680 (R2) resistance barrier. Should the bears be in charge we may see the pair breaking the 0.6340 (S1) support line, thus paving the way for the 0.6130 (S2) support level.<\/p>\n\n\n\n

As for the rest of the week:<\/strong><\/h2>\n\n\n\n

On Tuesday, we get Switzerland\u2019s, Turkey\u2019s and the Euro Zone\u2019s inflation metrics for May and from the US the factory orders and JOLTS job openings all being for April. On Wednesday we get Australia\u2019s GDP rate for Q1, the Czech Republic\u2019s preliminary CPI rate for May, the US ADP national employment figure for May and in Canada, BoC is to release its interest rate decision while from the US we get the ISM non-manufacturing PMI figure for May. On Thursday we expect the highlight to be the release of ECB\u2019s interest rate decision while we also get Australia\u2019s trade balance for April, China\u2019s Caixin Services PMI figure, Germany\u2019s industrial orders for April, Sweden\u2019s preliminary CPI rates for May, the Euro Zone\u2019s and the UK\u2019s construction PMI figures for May, the weekly US initial jobless claims figure and Canada\u2019s trade data for April. On Friday, we get Japan\u2019s all household spending, Australia\u2019s building approvals and Germany\u2019s industrial output, all being for April, UK\u2019s Halifax House prices for May, the Eurozone\u2019s revised GDP rate for Q1, Canada\u2019s employment data for May and May\u2019s US employment report.<\/p>\n\n\n\n

EUR\/USD Daily Chart<\/strong><\/h2>\n\n\n\n
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