US index rebounds to around $100, US refuses to exempt 10% of its reciprocal tariffs on Japan

On May 6, early trading in the Asian market on Tuesday, Beijing time, the US dollar index hovered around 100. On Monday, the US dollar index fluctuated and fell in the Asian and European sessions. Later, the US dollar index rebounded below $100 due to the unexpected ISM non-manufacturing data boosted, and finally closed down 0.24% to 99.79. The benchmark 10-year U.S. Treasury yield closed at 4.350%; the two-year U.S. Treasury yield closed at 3.8450%. Driven by weakening the US dollar and safe-haven demand, spot gold rose nearly $100 during the day and finally closed up 2.85% at $3,332.85 per ounce. Spot silver eventually rose 1.42% to $32.45 per ounce. Crude oil opened on Monday and closed down more than $1 after market news said OPEC+ will continue to accelerate its production growth. WTI crude oil finally closed down 2.06% at $57.15 per barrel; Brent crude oil closed down 1.82% at $60.30 per barrel.

Analysis of major currency trends

Dollar Index: As of press time, the US dollar index hovers around 100. U.S. Treasury Secretary Scott Becent said the United States may finalize some trade deals as early as this week, which has sparked optimism. He said he was confident that 17 trading partners except China had already put forward "very good" proposals that were under review. Technically, the closest resistance level of the US dollar index is in the range of 100.20–100.40. If the U.S. dollar index successfully closes above the 100.40 level, it will move towards the next resistance level 101.40–101.60.

Euro: As of press time, Euro/USD is hovering around 1.1288. Euro/USD is trading for a new week near the familiar 1.1300 mark. Euro/USD has been in a volatile consolidation phase as euro traders face difficulties in pushing the market in either direction. Technically, successful testing of support at 1.1275–1.1290 will open the way to test the next support at 1.1110–1.1130.

GBP: As of press time, GBP/USD is hovering around 1.3269. Although GBP/USD is still below its recent multi-year high, the price trend has been flat before the important data to be released by the Federal Reserve (Fed) and the Bank of England (BoE). Technically, if GBP/USD falls below the 1.3250 level, it will test the recent support level at 1.3200–1.3220.

Analysis of gold and crude oil market trends

1) Analysis of gold market trends

On Tuesday, gold trading was around 3359.45. Driven by the weakening of the US dollar and safe-haven demand, gold prices rose nearly 3% on Monday, and spot gold closed at $3333.73/ounce, up nearly $100 from last Friday's closing price. The market is waiting for the Federal Reserve's policy decision later this week. The US March trade account will be released on this trading day. Investors need to pay attention. In addition, we need to continue to pay attention to the relevant news about the geopolitical situation and international trade situation.

Technical: Judging from the daily chart RSI indicator, it is currently at the level of 58.99 and has not entered the overbought area, indicating that there is still room for upward in the short term. The Bollinger Band indicator shows that the price is currently operating above the middle track, with the upper track at 3468.23 and the lower track at 2968.48, indicating that it is currently in a strong channel.

2) Analysis of crude oil market trends

On the Asian session on Tuesday, crude oil trading around 56.98. After the Organization of Petroleum Exporting Countries (OPEC) announced that it will strengthen its internal production quota from June, it will recover recent losses. This move is widely regarded as a way to punish small OPEC countries that ignore the voluntary production ceiling, including Kazakhstan and Iraq.

Technical: From a technical perspective, WTI crude oil needs to climb above $58.00 to have a chance to gain upward momentum.

   Foreign exchange market trading reminder on May 6, 2025

Pre-determined ECB holds a central bank forum

09:45 China's April Caixin Service Industry PMI

13:45 Switzerland's April seasonally adjusted unemployment rate

14:45 France's March industrial output monthly rate

15:50 France's April service industry PMI final value

15:55 Germany's April service industry PMI final value

16:00 Eurozone's April service industry PMI final value

16:30 UK's April service industry PMI final value

17:00 Eurozone's March PPI monthly rate

20:30 United States Trade account

22:00 US Global Supply Chain Pressure Index in April

EIA released its monthly short-term energy outlook report

The next day, 01:00 US to May 6, 10-year Treasury bond auction-winning interest rate

The next day, 01:00 US to May 6, 10-year Treasury bond auction-winning multiple

The next day, 04:30 US to May 2, API crude oil inventories

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