Daily Analysis 28/04/2025

• GBP/USD Price: The GBP/USD pair stabilizes around 1.3310 during Monday’s European session, recovering slightly after prior losses, though technical patterns point to a cautious short-term outlook.
• Technical Outlook: Technical analysis reveals a break below the ascending channel on the daily chart, indicating a potential shift toward a neutral-to-bearish bias in the near term.
• UK Cautious: The British Pound's relative underperformance is linked to Finance Minister Rachel Reeves' comments signaling that Britain is in no rush to finalize a trade deal with the US, dampening sentiment.
• UK Retail Sales: Despite political headwinds, UK Retail Sales data showed unexpected growth of 0.4% in March, offering a modest boost to the Pound after February’s revised 0.7% increase.
• Philly Fed Business: The US Philly Fed Business Index plunged to -26.4 in April, far worse than expectations and signaling a sharp deterioration in new orders, a dynamic last seen during major economic crises.

Closing statement: While GBP/USD holds steady, the weakening technical structure and trade deal uncertainty with the US could cap further gains. Meanwhile, softening US data may offer some support for the pair in the coming sessions.

• XAU/USD Price: Gold (XAU/USD) remains under pressure during Monday’s European session, trading below the $3,300 mark and posting a 0.80% daily loss amid diminished safe-haven demand.
• US-China Trade Talks: Sentiment improved after China exempted some US imports from heavy tariffs and Trump reaffirmed that trade talks are ongoing, suggesting a potential easing of global trade tensions.
• Chinese Gold Demand: The China Gold Association reported a 5.96% year-on-year drop in gold consumption during Q1 2025, highlighting weaker physical demand from a key global buyer.
• Geopolitical Tensions: North Korea’s admission of troop deployment in the Russia-Ukraine conflict stirred fresh geopolitical concerns, but Trump's diplomatic push suggests efforts to de-escalate the situation remain active.
• US Macroeconomic Data: Traders are now looking ahead to key US data releases, including JOLTS job openings, PCE inflation, and the Non-Farm Payrolls (NFP) report, which could shape future Fed policy expectations.

Closing statement: Although geopolitical risks linger, the improving trade narrative and weakening physical demand are weighing on Gold prices, with upcoming US economic data set to provide the next major directional cue.

• Crude Oil Price: WTI Oil prices struggle to extend recent gains, trading near $63.30 during Monday’s European session as traders adopt a cautious stance amid mixed market signals.
• US-China Trade Signals: Despite Trump’s optimistic comments about progress with China, Beijing denied that trade negotiations are happening, while US Treasury Secretary Bessent offered no confirmation of talks, clouding the trade outlook.
• Geopolitical Uncertainty: US Secretary of State Marco Rubio warned that the US could abandon peace efforts if Russia-Ukraine negotiations stall, adding a layer of geopolitical risk to the oil market.
• Positive China Tone: Chinese officials reported steady exports and a planned expansion of imports for April, supporting a more resilient demand outlook for commodities, including oil.
• Nuclear Expansion: China’s State Council approved 10 new nuclear reactors, reinforcing its long-term energy diversification strategy, though the immediate impact on oil demand appears neutral to slightly bearish.

Closing statement: Crude oil prices remain under pressure as trade uncertainties and geopolitical tensions offset some positive signals from China, leaving the market sensitive to further developments in US-China and Russia-Ukraine relations.

• DAX Price: The DAX index rallied for the fourth consecutive session on Friday, rising 0.81% to close at 22,243, marking its highest level since April 2 amid sustained investor optimism.
• Auto Sector: German automakers such as Daimler Truck Holding (+2.21%), BMW, Mercedes-Benz, Porsche, and Volkswagen led the charge, supported by hopes for a softer US stance on tariffs.
• US Consumer Sentiment: The revised University of Michigan Consumer Sentiment Index for April showed an improvement to 52.2 from the preliminary 50.8, providing an additional lift to risk appetite.
• Dallas Fed Manufacturing Index: Attention now turns to the Dallas Fed Manufacturing Index, due Monday, with economists forecasting a slight improvement from -16.3 to -15, which could further influence sentiment.
• Trade Relations: Trade developments between the US and EU remain a key market driver, with a de-escalation in tensions likely to boost German equities even further.

Closing statement: With technical momentum and trade optimism supporting the DAX, upcoming US economic data and any easing in US-EU trade frictions will be pivotal in determining the next move higher.