High volatility in the financial markets continues as European trading opens on Monday (April 7, 2025). Significant market movements are expected tonight, especially with any new developments related to the trade war.
GOLD
Gold (XAUUSD) prices have managed to hold onto gains as trading starts in Europe, hovering near the daily peak of $3,055.38 per troy ounce. Earlier today, Gold dipped to $2,970 per troy ounce before experiencing a rebound.
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This movement reflects that Gold remains supported by the widening trade conflict. President Donald Trump has announced reciprocal policies leading to significant increases in import tariffs from approximately 60 nations.
In response, China promptly raised import tariffs on goods from the United States, signaling a further escalation in the trade war. Should other countries also retaliate against the U.S., the sentiment for Gold could turn increasingly favorable.
OIL
Oil (CLS10) prices have cut their decline after falling to $58.93 per barrel. Prices have now climbed back above the $60 mark.
Currently, Oil is at its lowest point in a year, which allows for the reduction in loss. The expanding trade war poses a risk to economic growth, potentially impacting demand. This negative sentiment is expected to persist in tonight’s trading.
EURUSD
EURUSD volatility has been quite pronounced today, dropping to 1.08780 before rebounding to 1.10499. However, it has since slipped back to around 1.09520 this afternoon.
Despite Eurozone retail sales data indicating a growth of 2.3% year-on-year (YoY) in February, higher than the forecast of 2.1% YoY by Trading Central and the previous month’s 1.8% YoY, EURUSD continues to face downward pressure.
This shows that market participants are focused on the trade war, and high volatility for EURUSD is likely to continue, with a tendency towards further pressure.
GBPUSD
GBPUSD is also experiencing high volatility, reversing today to 1.28094. The currency pair is affected by trade war concerns, despite the UK facing only a 10% reciprocal import tariff.
Additionally, the risk of a global economic slowdown continues to exert negative sentiment on GBPUSD, which is expected to linger in tonight’s trading.
USDJPY
USDJPY has shown volatility within a range of 144.818 – 146.843 this afternoon. The yen is considered a safe haven asset that benefits from the risks arising from a global economic slowdown due to the trade conflict.
Conversely, the U.S. dollar is under pressure from the risks associated with slowing U.S. economic growth. Thus, USDJPY may experience additional stress.
Nasdaq
The Nasdaq has managed to reduce its losses to 17,275 after experiencing a drop to 16,460 earlier today. The decline of Nasdaq to a 15-month low has triggered short covering as well as bargain hunting, resulting in a gradual rebound.
However, if the trade war escalates further, there is potential for Nasdaq to face renewed pressure.
