EUR/USD Surge: Technical and Fundamental Drivers Point to Further Gains
Market Overview
Japan
Japan's market reacted strongly to President Trump's new wave of tariffs, with Japanese goods facing a 24% levy. The yen surged nearly 2% in the previous session, hovering near a six-month high around 146 JPY/USD, as investors flocked to safe-haven assets amid growing fears of a global recession. Domestically, February’s personal spending data showed only a slight decline, providing some degree
of stability to market sentiment.
The Nikkei index dropped nearly 5% over two sessions as investors pulled out of equities. The Bank of Japan is expected to continue raising interest rates in 2025, though the outlook remains uncertain due to escalating
trade tensions and slowing global growth. Japanese exporters—especially automakers—may face heavy pressure, with cumulative U.S. import duties on some vehicles reaching up to 51.5%.
China
China's market is facing significant pressure from the U.S.'s aggressive trade measures. The yuan weakened sharply after President Trump announced sweeping tariffs, including a 54% levy on Chinese goods. However, the decline of the U.S. dollar helped the yuan recover slightly, trading around 7.25 USD/CNH.
In response, China resumed trade talks with the EU and accelerated free trade negotiations with Japan and South Korea. The People’s Bank of China set the yuan’s daily fixing at its weakest level in over two months but maintained tight liquidity conditions to stabilize the currency and curb panic selling.
BTC/USD
Prediction: Weak sideways movement, slightly biased toward a downtrend.
Bitcoin is currently fluctuating within a range from the strong support area around $80,000 to the key resistance level at $88,756 (Supply Zone). In the short term, price has failed to break through major resistance levels and continues to be rejected at supply zones, indicating selling pressure remains significant. The trend structure is unclear, but with the price trading below all three EMAs, the medium-term downtrend remains dominant.
FUNDAMENTAL ANALYSIS
ETFs and Institutional Flows:
New data from Arkham Intelligence shows that major Bitcoin ETF issuers like Grayscale, Fidelity, and Ark Invest are actively buying BTC, with net inflows reaching $220 million just yesterday. This reflects rising demand expectations despite short-term volatility and macroeconomic risks.
The Long/Short Ratio increased from 0.94 to 1.0, suggesting market sentiment has shifted from mildly bearish to neutral.
Policy and Geopolitical Impacts:
President Trump’s announcement of a sweeping tariff hike shocked the market, dragging down risk assets—including Bitcoin.
Rising economic uncertainty is pushing institutions toward BTC as a hedge against inflation and weakening traditional finance (TradFi).
Genius Group Case:
A New York court has ordered Genius Group to liquidate part of its Bitcoin reserves to sustain operations, as it is barred from raising funds and purchasing BTC.
This is a prime example of the legal risks surrounding a “Bitcoin-first treasury” strategy for companies, highlighting the uncertainty of BTC holdings from a corporate perspective.
Market Sentiment:
BTC price dropped 5.77% on the day, the largest decline since March 3, 2025.
Although there has been a bounce from the strong support area at $81,000, many analysts still believe a drop to $78,600 is possible if the price fails to reclaim the $85,000–$86,000 zone.
Overall, market sentiment is currently in a “wait-and-see” phase—awaiting clearer signals on the next trend.
TECHNICAL ANALYSIS
Key Resistance Levels
● $88,756: Major supply zone, repeatedly rejected.
● $85,593: Near-term resistance, aligning with the EMA200 – a key medium-term trend indicator.
● $84,375 – $83,786: EMA 89 and EMA 34 – dynamic resistance zones indicating short-term trend strength.
Key Support Levels
● $82,800: Short-term support, recent intraday low.
● $80,000: Critical psychological and technical support. ● $76,600: Deeper support if the downtrend continues.
Technical Indicators:
RSI: Currently at 45.86, down from above 60 – indicating weakening recovery momentum. No clear divergence signals, and RSI below 50 shows selling pressure is still dominant.
Trading Volume: Gradually declining in recent sessions, signaling market indecision. If volume continues to dry up, a strong move (either breakout or breakdown) is likely in the next few sessions.
Price Action:
● Watch price behavior around $81,000–$82,000. If this support holds, short-term buy opportunities may arise with targets at $84,000–$85,000.
● If $80,000 is broken, the downtrend is reconfirmed and the $78,600 target could be triggered.
● Wait for confirmation through volume and price patterns (e.g., reversal candles, breakout volume) before entering trades.
Investors should closely monitor ETF flows, traditional market trends, and U.S. policy developments—especially as risk assets remain under heavy pressure. A cautious trading approach is advised, with capital preservation prioritized if market weakness persists.
USOIL (WTI Crude Oil)
Prediction: Decrease
WTI crude oil continues to decline sharply, currently trading around $66.58 after losing nearly 7% in the previous session. The trend is clearly bearish, with a consistent lower highs and lower lows structure, especially after being rejected from the strong resistance zone at $70.45. Selling pressure is dominant, and the market is now testing the critical support zone at $65.35. If this level is broken, the downtrend may continue toward $62.73.
FUNDAMENTAL ANALYSIS
Monetary Policy and Fed Impact:
Recession fears stemming from the Trump administration’s new tariff policy have led investors to expect deeper Fed rate cuts. The market is now pricing in 96 basis points of cuts in 2025, up sharply from the previous 70 bps projection.
This has driven U.S. Treasury yields lower and weakened the USD — typically supportive for oil prices. However, this positive effect is being outweighed by supply-demand pressures.
Oil Supply & Demand:
OPEC+ surprised the market by announcing a production increase of 411,000 barrels/day for next month — nearly 3x the forecast of 140,000 bpd.
This surge in supply, amid weak demand, raises the risk of a global oil glut over the next 6–9 months.
China — the world’s largest oil importer — reported a 1.9% YoY decline in crude imports, reflecting slowing growth.
Global Trade & Economic Outlook:
Trump’s new tariffs have triggered fears of a full-blown trade war. Major nations have already begun retaliating, further raising recession risks.
Equity markets plunged — the S&P 500 lost over $2.4 trillion in market cap in a single session, the worst drop since the COVID-19 pandemic.
Recent U.S. economic data has also weakened (e.g., ISM Services, long-term unemployment rising), further dampening oil demand prospects.
Geopolitics & Market Sentiment:
Tensions in the Middle East continue: the U.S. and Israel are ramping up strikes in Gaza and Yemen, while Russia increases oil and refined product exports.
Although geopolitical tensions usually support oil prices, they’re currently being overshadowed by supply-demand imbalance and recession fears.
TECHNICAL ANALYSIS
Key Resistance Levels
● $70.45: Recent strong rejection point.
● $72.55: Near the EMA200 – a strong dynamic resistance, previously unbroken.
● $68.65: Short-term resistance, potential retest level if a bounce occurs.
Key Support Levels
● $67.25: Short-term support, currently under pressure.
● $66.58 – $65.35: Strong support zone; a break below would confirm continuation of the downtrend.
● $62.73: Major support level, 3-month low.
Technical Indicators:
RSI: Currently at 40.22, trending downward and nearing oversold territory → indicates strong selling pressure, but a technical rebound may be possible near support.
Volume: Wide price range with large red candles shows strong bearish momentum. If volume rises on further drops, downside could extend.
Price Action:
● Watch for reactions at the $65.35 level — if reversal patterns (e.g., pin bar, bullish engulfing) appear, a technical rebound toward $68.65 may be considered.
● If support is broken, best to stay on the sidelines and wait for lower entry opportunities around $62.73 or below.
USOIL is under heavy pressure from both fundamental and technical perspectives. OPEC+’s production hike amid recession fears creates a double whammy driving prices lower. In the short term, further downside is possible if $65.35 breaks. However, investors should closely monitor this level for a potential bounce opportunity if selling pressure eases.
EUR/USD
Prediction: Increase
The EUR/USD currency pair is in a clear uptrend, especially after a strong breakout through key resistance levels at 1.08747 and 1.09461. The price is currently trading around 1.10655, after reaching a short-term high of 1.11450 — the highest level since late September 2024. While the RSI is in overbought territory, suggesting a possible short-term correction, the overall trend remains intact with higher lows continuing to form.
FUNDAMENTAL ANALYSIS
Monetary Policy and Fed Impact:
The Federal Reserve is under pressure to implement deeper rate cuts following President Trump’s surprise announcement of new tariffs.
Futures markets are now pricing in nearly 100 basis points of rate cuts for 2025, with expected cut dates in June, July, October, and December.
The 2-year U.S. Treasury yield has dropped significantly to 3.6611%, extending an 18 basis point drop from the previous session — reflecting growing expectations of Fed policy easing amid recession fears.
Fed Chair Jerome Powell is scheduled to speak today, which could offer crucial policy insights.
Inflation and Market Drivers:
The U.S. dollar has weakened sharply as the DXY index fell 1.9% — the largest single-day drop since November 2022. This is due to investors reassessing the negative impact of the new tariff policy.
The U.S. ISM Services Index for March dropped to 50.8 from 53.5 — the lowest in nine months. Notably, the employment component plunged by 7.7 points, indicating a slowdown in the service-sector labor market, which accounts for about 30% of U.S. GDP.
Input prices remain high, while export orders dropped to 45.8, the lowest in two years — directly reflecting the effects of trade tensions.
Geopolitics and Market Sentiment:
President Trump unexpectedly announced a 10% base tariff on all imports, with higher rates on EU (20%), Japan (24%), and China (54%). This triggered a global stock market sell-off as investors rushed toward safe-haven assets.
In response, the EU, Canada, and China have declared retaliatory trade measures, increasing the risk of a full-blown trade war and global recession.
The Japanese yen and Swiss franc have surged against the dollar, indicating a capital shift away from the greenback.
The euro is benefiting from both a weaker USD and a flight to alternative safe-haven assets.
TECHNICAL ANALYSIS
Key Resistance Levels
● 1.11450: Recent high — a breakout above this may open the way to 1.12753.
● 1.12753: Strong long-term resistance (visible on D1/H4 timeframe).
Key Support Levels
● 1.10089: Nearest support — potential retest zone after the breakout.
● 1.09461: Next key support.
● 1.08747: Strong support, aligns with EMA34.
● 1.07886: Critical base level before the breakout.
● 1.07207 – 1.07324: Strong support zone near the EMA200.
Technical Indicators:
RSI: Currently at 77.72, in overbought territory → indicates potential for a short-term correction but no signs of trend reversal yet.
Volume: While not directly shown on the chart, the strong momentum and breakouts of key zones suggest heavy buying pressure — confirmed by long-bodied candles and strong price action.
Price Action:
● Price has broken out of consolidation and key resistance zones, confirming the uptrend.
● A potential trading strategy would be to buy on dips toward the 1.10089 – 1.09461 area, if a bullish confirmation pattern appears (e.g., bullish engulfing, pin bar).
● Short-term take-profit target: around 1.11450.
● Extended target: 1.12753 if 1.11450 is broken.
● Suggested stop-loss: Below 1.08700, to protect against trend failure.
EUR/USD is being supported by both technical strength and fundamental drivers. The U.S. dollar is under pressure from harsh new trade policies, weakening economic data, and a shift in market sentiment toward risk aversion. Meanwhile, the euro is gaining favor as an alternative amid capital outflows from USD.
Investors should closely monitor Fed Chair Powell’s speech and the upcoming U.S. Non-Farm Payroll (NFP) report for further trading cues.
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