ATFX Market Outlook 24th March 2025

ATFX Market Outlook 24th March 2025

Fed Signals Caution, Dollar Extends Rally as Gold Pulls Back Further

Market HighlightAmid ongoing economic uncertainties, several Federal Reserve policymakers supported a cautious approach to monetary policy. U.S. equities finished higher on Friday, with the S&P 500 and Dow Jones reversing earlier losses. Market sentiment improved following comments from former President Trump, which raised hopes that the tariffs scheduled to take effect in early April may not be as severe as initially feared. 

The U.S. dollar strengthened against the euro, recording its first weekly gain in March as investors realised profits on the euro's recent rally ahead of the reciprocal tariff implementation on April 2. EUR/USD dipped 0.3% to 1.0822, while USD/JPY increased by 0.3% to 149.21 and GBP/USD fell 0.3% to 1.2930. 

Gold prices decreased by 1% on Friday amid profit-taking and a stronger dollar. However, the metal recorded its third consecutive weekly gain, supported by ongoing geopolitical risks and expectations of Federal Reserve rate cuts. Oil prices rose for a second consecutive week, bolstered by renewed U.S. sanctions on Iran and OPEC+’s latest production plans, which heightened market expectations of tighter supply.

Key OutlookToday’s focus shifts to the final readings of March Manufacturing and Services PMIs from significant economies. Preliminary figures indicate a notably weak performance in the UK manufacturing sector, contributing to sluggish GDP growth in January. While U.S. PMIs remain in expansionary territory, signs of deceleration continue to emerge, which could impact broader economic momentum.

Key Data and Events Today:

16:30 EU GERMANY Manufacturing & Services PMI Flash MAR ** 

17:00 EU Manufacturing & Services PMI Flash MAR ** 

17:30 GB Manufacturing & Services PMI Flash MAR ** 

21:45 US Manufacturing & Services PMI Flash MAR *** 

Tomorrow

07:50 BoJ Monetary Minutes ***

17:00 EU GERMANY Ifo Business Climate MAR ** 

22:00 US CB Consumer Confidence MAR ** 

EURUSD

· Resistance: 1.0859 / 1.0881

· Support: 1.0792 / 1.0763

EUR/USD hovers around 1.0840 as the US Dollar weakens due to fears of a slowdown driven by Trump’s tariffs and easing geopolitical tensions. Revised US trade policies and discussions regarding Ukraine bolster sentiment; however, Eurozone growth faces risks from new tariffs, with Germany likely to be the most brutal hit. ECB officials caution against rising uncertainty.

GBPUSD

· Resistance: 1.2955 / 1.2978

· Support: 1.2900 / 1.2881

GBP/USD hovers around 1.2930, bolstered by a weaker USD and the BoE’s hawkish stance. Markets are watching for potential Fed cuts amidst fears of a slowdown. Attention now turns to the forthcoming PMIs and speeches from central banks.

USDJPY

· Resistance: 150.12 / 150.35

· Support: 149.15 / 148.92

Japan’s business activity contracted in March, with the composite PMI declining to 48.5 as both the manufacturing and services sectors shrank. Weak overseas demand, rising inflation, and uncertainty over Trump’s impending tariffs hindered growth, while high input costs further suppressed services activity.

US Crude Oil Futures (MAY)

· Resistance: 68.75 / 69.04

· Support: 67.83 / 67.55

Oil prices remained stable as markets evaluated the Russia-Ukraine ceasefire discussions and the potential increase in Russian supply. Gains were constrained despite backing from U.S. sanctions on Iran and reductions by OPEC+, while the growing output from Kazakhstan and future OPEC+ strategies remain a focal point.

Spot Gold

· Resistance: 3047 / 3062

· Support: 3004 / 2986

Spot Silver

· Resistance: 33.30 / 33.65

· Support: 32.72 / 32.43

Gold prices declined further as a stronger dollar and stable Federal Reserve rate outlook affected sentiment despite demand for safe-haven assets. Silver, platinum, and copper also experienced a drop, with copper being pressured by tariff concerns and a tightening supply from China.

Dow Futures

· Resistance: 42333 / 42702

· Support: 41496 / 41115

The Dow Futures remained close to 42,000 on Friday as markets experienced volatility from a $4.7 trillion options expiry and ongoing tariff uncertainty. President Trump suggested "flexibility" in his April tariff plans, which prompted investor caution. Meanwhile, the Fed upheld its dovish outlook, with markets anticipating a rate cut by June.

NAS100

· Resistance: 20141 / 20344

· Support: 19297 / 19101

U.S. stock futures increased as Trump’s April 2 tariffs are expected to be more limited, alleviating market concerns. Key sectors will be exempted, and duties will focus on only about 15 countries. The Nasdaq 100 rose slightly. Markets await Fed speeches, March PMI data, and Q4 GDP revisions for further guidance.

BTC

· Resistance: 88512 / 90392

· Support: 82777 / 80412

Bitcoin futures data indicates a rising long/short ratio, suggesting bullish sentiment. With more traders wagering on price increases, Bitcoin could soon challenge $85,000 or even $90,000 if the momentum persists.

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