Forex Signals Brief May 12: Trading US Inflation and Trade Deals This Week

The financial markets are experiencing dynamic shifts, with gold retreating from record highs amid trade optimism, the USD/JPY pair rebounding due to dollar strength, Bitcoin breaking above $100,000 on positive trade developments, and Ethereum rebounding following a significant network upgrade. Weekly Market Outlook: May 12–16, 2025 Today is light in terms of economic data, but it will pick up later in the week. This week features several significant economic indicators and events that could influence global markets. Monday, May 12 Federal Reserve Governor Adriana Kugler Speaks Tuesday, May 13 Wednesday, May 14 Thursday, May 15 Friday, May 16 Last week, markets were slower than what we’ve seen in recent months, with gold retreating as a result, the EUR/USD falling below 1.12, and stock markets continuing upward. The moves weren’t too big, but we opened 37 trading signals in total, finishing the week with 25 winning signals and 12 losing ones. Gold Retreats from Record High Amid Trade Optimism After reaching an unprecedented $3,500 per ounce in April, gold prices have experienced a notable correction. In the past two days, spot gold has declined by nearly $140, settling around $3,300 per ounce—a 1.9% decrease. This pullback coincides with renewed market optimism following the announcement of a new US-UK trade agreement, which has shifted investor sentiment towards riskier assets. Analysts suggest that this dip is more reflective of improved trade prospects than a fundamental change in gold’s value. The 20-day simple moving average (SMA) continues to provide strong support during gold’s ascent. Should the price stabilize and form bullish reversal patterns, it may present an opportunity for investors to re-enter long positions. USD/JPY Rebounds Amid Dollar Strength The USD/JPY currency pair has shown resilience, recovering from the critical 140.00 level, supported by its 100-month moving average. A recent 2.5-cent surge propelled the pair to 146. Despite this recovery, the Japanese yen remains susceptible to global risk sentiment and the momentum of the US dollar. USD/JPY – Weekly Chart Cryptocurrency Update Bitcoin Breaks Above $100,000 on Trade Deal Optimism Bitcoin has regained its upward momentum, surging over 6% to surpass $103,850, marking its first time above $100,000 since February. This rally is attributed to positive sentiment surrounding the new US-UK trade deal and potential progress in upcoming trade talks with China. Bitcoin’s resilience, while other assets struggle, underscores its continued strength in the market. BTC /USD – Weekly chart Ethereum Faces MAs after Rebound Following Pectra Upgrade Ethereum, which had been in a prolonged downtrend for much of the year—falling from a high of $3,634 in January to a low of $1,475 in early April—has experienced a significant rally. This resurgence follows the successful implementation of the Pectra upgrade, which introduced key enhancements to wallet functionality and staking mechanisms. Ethereum’s price has risen nearly 20% to surpass $2,000, continuing its upward trajectory beyond $2,200 and reversing months of downward pressure. ETH /USD – Weekly Chart