The dollar index continues to weaken, and gold touches the $3,300 mark

On May 21, early trading in Asia on Wednesday, Beijing time, the US dollar index hovered around 99.94. On Tuesday, Fed officials made more cautious remarks about the economy, while traders were looking forward to upcoming talks between the U.S. and Japan, which could include exchange rate discussions as part of the trade deal. The US dollar index continued to weaken and fell to around the 100 mark, eventually closing down 0.34% to 100.02. The benchmark 10-year U.S. Treasury yield closed at 4.491%; the two-year U.S. Treasury yield closed at 3.977%. Benefiting from the fact that there is still a certain degree of uncertainty in the market, spot gold first fell and then rose, started a rise during the European session, and accelerated upward in the US session, rising nearly 2% during the day, approaching the $3,300 mark, and finally closed up 1.84% to $3,289.98 per ounce. Spot silver finally closed up 2.26% at $33.06 per ounce. On Wednesday, gold rose above the $3,300 mark as US media reported that Israel may be preparing to attack Iran's nuclear facilities, but it has fallen as of press time. As the outlook for the oil market seems to be still full of fog, the two oils fell into volatility, WTI crude oil fluctuated back and forth around US$62, and finally closed up 0.11% to US$62.12/barrel; Brent crude oil closed up 0.12% to US$65.01/barrel. On Wednesday, U.S. oil rose 3%.

Analysis of major currencies

Dollar Index: As of press time, the US dollar index hovers around 99.94. The U.S. dollar index fell to 100.23 on Tuesday, continuing weeks of decline after failing to test the 50-day moving average of 101.60. Previously, Moody's downgraded the US sovereignty rating and publishedThe Fed's dovish comments highlighted the limited room for fiscal risks and interest rate cuts. Technically, the US dollar index hovers above the key support area of ​​100.21, and the momentum remains bearish. As market sentiment tends to be negative, any drop below 100 may trigger a more drastic sell-off.

Euro: As of press time, the euro/dollar hovers around 1.1289. European policymakers are currently busy with the G7 meeting, reducing important headlines from key EU policymakers. Overall market sentiment relies entirely on trade headlines from the U.S., and investors hope to reach a deal with the Trump administration to encourage President Trump and his staff to remove the threat of tariffs from their own economy. Technically, the euro/dollar rose to 1.1250, riding on the wave of weak US dollar and market confidence in the stability of the euro zone. The pair has recovered the 1.1200 level and now serves as support and pierces the resistance below 1.1300. The 50-cycle SMA on the 4H chart has been upward, and the price trend indicates that it continues to move towards the 1.1320 area. Unless the dollar revives meaningfully above its 50-day moving average, the euro may continue to attract buyers.

GBP: As of press time, GBP/USD hovers around 1.3397. The GBP/USD rose slightly on Tuesday, climbing to near (but still failed to break through) the 1.3400 mark. The pound/dollar is ushering in a series of key inflation and business outlook data releases, with the UK Consumer Price Index (CPI) inflation scheduled to be released on Wednesday, and the UK and the US Purchasing Managers Index (PMI) survey results will be released on Thursday. Technically, the pair remained stable at 1.3367 after the pound rose 0.6% on Monday after its post-Brexit defense and trade restructuring with the EU. GBP/USD approaches resistance around 1.3400, with a 50-cycle SMA providing a 1.3287 platform. The bullish structure on the 4H chart and the recent bullish candles suggest a further upside is justified, especially if the dollar weakness continues and sentiment around UK growth is stable.

Analysis of gold and crude oil market trends

1) Analysis of gold market trends

Which trading was held in Asian trading, gold trading was around 3301.14. In the early Asian market, spot gold continued to rise, once hitting a more than one-week high of $3,304.06 per ounce, as media reports said that Israel was preparing to attack Iran's nuclear facilities, further providing safe-haven buying support for gold prices. Economic data on this trading day are relatively small, and investors mainly pay attention to news related to the US tax reform bill and pay attention to geopolitical situations.News, pay attention to the speeches of Federal Reserve officials and changes in the international trade situation.

Technical: From a technical perspective, gold has performed strongly recently. Gold prices need to break through the key resistance level of $3,350 in the short term to open upward space, while $3,150 below has formed solid support. If geopolitical or economic data adds variables, gold prices may even challenge the $3,400 mark. But it is worth noting that despite recent downward pressure, the $3,200 support remains firm, strengthening the lower boundary of the triangle, indicating strong buyer interest near the area. The relative strength index (RSI) remains neutral around 53, indicating that there is currently a lack of significant momentum bias.

2) Analysis of crude oil market trends

On Wednesday, crude oil trading around 62.86. Several U.S. officials familiar with the latest intelligence told CNN that the U.S. has obtained new intelligence that shows Israel is preparing to attack Iran's nuclear facilities, even as U.S. President Donald Trump has been seeking diplomatic agreements with Tehran. CNN quoted an unnamed official as saying it was unclear whether the Israeli leader had made the final decision to conduct the attack. Whether and how Israel launches an attack is likely to depend on its assessment of the United States and Tehran in negotiations on nuclear program.

Technical: Technically, given the weak inventory and economic indicators of some economies around the world, technical resistance suppresses the increase, the short-term outlook for crude oil is relatively bearish. Traders need to pay attention to whether the price can hold the $60.00 support level; if it falls below this level, it may test $59.13 again.

Forex market trading reminder on May 21, 2025

①14:00UK April CPI monthly rate

②14:00UK April retail price index monthly rate

③22:30UK April EIA crude oil inventories in the week from the United States to May 16

④22:30UK EIA Cushing crude oil inventories in the week from the United States to May 16

⑤22:30UK April EIA strategic oil reserve inventories in the week from the United States to May 16

⑥The next day at 00:00UK Fed Barkin attended the "Feder Listening" event

The above content is about "【XM Group]: The US dollar index continues to weaken, and gold touches the $3,300 mark again" is carefully compiled and edited by the editor of XM Forex. I hope it will be helpful to your trading! Thanks for the support!

In fact, responsibility is not helpless, it is not boring, it is as gorgeous as a rainbow. It is this colorful responsibility that has created a better life for us today. I will try my best to organize the article.