empty
26.05.2025 09:39 AM
Donald Trump Has Never Held Back... (EUR/USD May Resume Its Upward Trend, While #USDX May Decline)

Watching everything unfold in the markets lately makes you want to write a script for a blockbuster in the style of The Godfather. The U.S. president has completely abandoned all formalities and now behaves like a cinematic version of Don Corleone, as portrayed by the legendary Marlon Brando.

Trump has taken complete manual control, as he seems to believe he is in charge of the entire world—a world where the star of "great America" must rise again. He even physically resembles a character from Mario Puzo's works, with similar mannerisms and weight in his voice. It appears he enjoys making major decisions just as politicians and financial markets are trying to take a breather over the weekend. However, the self-proclaimed ruler of the world refuses to let anyone relax.

Once again this weekend, the U.S. President announced that he is delaying the introduction of a 50% customs tariff on goods from the European Union, extending the deadline to July 9. In a post on Truth Social, he said the decision followed a conversation with European Commission President Ursula von der Leyen. The EU chief confirmed the call, describing it as "a good conversation" and noted that much more time is needed "to reach a good deal."

What does this mean? It seems to be a continuation of pressure on EU officials—almost like a scene from a movie. Trump is giving them time to think before making any drastic moves. He continues to leverage his influence over those who permit it.

What about the markets? After a turbulent week marked by increasing fears of a financial crisis in the U.S. due to tensions from the tariff standoff, which significantly affected investor sentiment, the markets are breathing a sigh of relief this Monday. While it's not a complete 90-day pause in the trade war with China, as the saying goes, "In the land of the blind, the one-eyed man is king."

Futures for major U.S. stock indices are rising confidently, which is likely to lead to a positive market opening. Investors and speculators are expected to respond to this news, potentially triggering a renewed rally in the U.S. stock market. However, like the temporary truce, this rally is anticipated to be short-lived.

On this wave of optimism, the dollar will most likely continue to fall almost vertically, with the Dollar Index potentially sliding to 98.00 before a new phase of consolidation begins. As for gold, if it manages to break through the strong resistance level at 3358.50, it may reverse and fall to the previously projected target of 3263.75.

But how long will this wave of positive sentiment last?

Probably not for long. This week, the minutes from the latest Federal Open Market Committee (FOMC) meeting on monetary policy will be published. It's unlikely that the Federal Reserve will signal a readiness to abruptly resume rate cuts. For now, Chair Jerome Powell is showing admirable caution, even though inflation has approached the coveted 2% target, with April's year-over-year figure dropping to 2.3%. However, things could change dramatically if the Q1 GDP report shows a -0.3% contraction. This would mark the first negative reading since November 2022, effectively indicating the start of a recession.

Confirmation of that fact would be a strong argument for the Fed to cut the key interest rate by 0.25% in June to stimulate the national economy. This would undoubtedly trigger increased demand for equities, further dollar weakening, and renewed interest in cryptocurrencies. The probability of this scenario is quite high.

This image is no longer relevant

This image is no longer relevant

Forecast of the Day:

EUR/USD

The pair steadily rises due to Trump's announcement to postpone tariff hikes on EU goods in the U.S.-EU trade. This development may continue to support the pair, and if it breaks above 1.1425, it could head toward 1.1530. A potential buy level for the pair could be 1.1432.

#USDX

The Dollar Index is trading below 98.90. There is a high probability of a continued decline, especially if negative Q1 GDP data confirms market fears and prompts the Fed to cut interest rates in June. In this case, the index may fall to 98.00. A potential sell level could be 98.65.

Pati Gani,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

AUD/JPY. Analysis and Forecast

The AUD/JPY pair is regaining positive momentum after a modest pullback the previous day. However, spot prices remain confined within a multi-day range due to mixed fundamental signals, trading near

Irina Yanina 14:39 2025-06-20 UTC+2

USD/CHF: The Pair Struggles to Gain Momentum Amid Conflicting Forces

At present, USD/CHF shows no clear intraday direction and fluctuates within a narrow range just above the 0.8155 level, reflecting market uncertainty during the European session. The Swiss franc

Irina Yanina 14:36 2025-06-20 UTC+2

The Euro Will Retain Its Strength and Investor Interest

During her speech, IMF Managing Director Kristalina Georgieva stated that she sees the potential for the euro to play a broader role globally.Her remarks came amid growing geopolitical instability

Jakub Novak 11:25 2025-06-20 UTC+2

Euro Slightly Rises After Lagarde's Speech

The euro saw a modest recovery after European Central Bank President Christine Lagarde stated that expanding trade within the region could help offset losses resulting from global fragmentation. Her optimistic

Jakub Novak 11:10 2025-06-20 UTC+2

Donald Trump – A Mastermind of Geopolitical Uncertainty (A Potential Correction in Oil and Gold Prices)

Six months into Donald Trump's presidency, it seems he has already thoroughly exhausted the world with his "brilliant" initiatives, groundbreaking actions aimed at making America great again, and his vivid

Pati Gani 09:49 2025-06-20 UTC+2

The Market Tries to Extinguish the Fire

Markets are digesting Donald Trump's announcement that a decision on U.S. strikes against Iran will be made within two weeks. The White House could have acted at any moment

Marek Petkovich 09:01 2025-06-20 UTC+2

What to Pay Attention to on June 20? A Breakdown of Fundamental Events for Beginners

There are very few macroeconomic reports scheduled for Friday. The only report of the day will be the UK retail sales report. No economic data will be released today

Paolo Greco 07:45 2025-06-20 UTC+2

GBP/USD Overview – June 20: The Bank of England Didn't Surprise

The GBP/USD currency pair traded relatively calmly on Thursday, given the fundamental backdrop available to the market. On Wednesday evening, the Federal Reserve announced the results of its latest meeting

Paolo Greco 07:16 2025-06-20 UTC+2

EUR/USD Overview – June 20: Summing Up the Fed Meeting

The EUR/USD currency pair traded relatively calmly on Wednesday and Thursday. Recall that the results of the latest 2025 Federal Reserve meeting were announced on Wednesday evening, but we didn't

Paolo Greco 07:16 2025-06-20 UTC+2

USD/JPY. Analysis and Forecast

The Japanese yen is showing weakness against the stronger U.S. dollar, with the USD/JPY pair reaching a new monthly high. This rise in the dollar against the yen is mainly

Irina Yanina 20:12 2025-06-19 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.