The US Dollar Index (DXY) continued its upward move, closing the last session up 0.35% at $98.68. The strength is carrying in today’s Asian morning session as well, with the index trading around $98.77, up another 0.10%, supported by a firm tone following the Fed decision.
The dollar is staying strong after the Federal Reserve kept interest rates unchanged at 3.50%–3.75%, but the tone of the meeting was clearly hawkish. What stood out was the split in the decision. 8 members in favour and 4 against, the most divided outcome in decades. Importantly, those who disagreed were leaning towards a tighter policy, not easing. This tells us that there is still concern within the Fed about inflation, and it strengthens the higher for longer interest rate outlook, which is positive for the dollar.
Traders will now look to upcoming data for direction, particularly the preliminary US GDP reading for the first quarter and the March PCE inflation report, both due later on today. If these numbers come in stronger than expected, it could provide further support to the US Dollar in the near term.
From a technical perspective, DXY has immediate support near its 9-day moving average at $98.31, followed by $97.89, which is this week’s low. On the upside, resistance is seen at $98.88. If the index breaks above this level, it could move higher towards $99.17, an important horizontal resistance zone. EUR/USD is currently trading at 1.1665, down by 0.10% in today’s session. Immediate support is seen at 1.1634, and resistance is at the 9 Day SMA at 1.1712.
Oil surged to a wartime peak as President Trump will be briefed about potential new military possibilities in the battle against Iran later today. Although a ceasefire has held firm since early April, the closure of the Strait of Hormuz by both countries has severely impacted crude flows, keeping oil prices elevated. President Trump rejected Iran’s latest proposal. Moreover, the U.S. Central Command has allegedly asked for hypersonic missiles to be sent to the Middle East, although this news is not officially confirmed. If that were to happen, it would mark the first time for America to deploy such weapons. Adding to this is President Trump’s indication to extend the blockade on the Strait indefinitely to further pressure Iran.
The IEA has already called the ongoing supply disruption the largest in history. With Middle Eastern crude unable to reach global markets, buyers have turned to the U.S. for supplies, and U.S. crude exports have surged to a record high of 6 million barrels per day. The cumulative U.S. crude oil and fuel exports touched 14 million barrels per day. However, such record exports are not sustainable and are insufficient to meet the market shortfall. The EIA reported that stockpiles in Cushing plummeted below 30 million barrels as exports surged. Recently, President Trump met with energy giants like Chevron to discuss ways to maintain the pressure on Iran while limiting its impact on American consumers. This suggests the U.S. is likely preparing to prolong the pressure on Iran instead of seeking a swifter resolution.
Brent is up 1.13% at $119.30. The 5-period RSI on the day chart is at 67, on the verge of veering into overbought territory. We could see a slight dip to $114.75, roughly aligning with the intraday low. However, the bias remains firmly tilted to the upside. A close above $120.50 could pave the way for a leg up to $126.50. WTI is up 1.32% at $112.45. Sustained moves above $113.30 could potentially pave the way for a leg up to $116.30. The commodity has support around $108.50.
Stock markets had a slow upward day. SPX closed virtually unchanged at $7,120 while NDX was up 0.45% at $27,120.
Markets find themselves caught between favourable macro read-throughs and many tailwinds in forward-looking data.
The Fed meeting on Wednesday took one market overhang off the table, but the voting was abnormally close and a fresh spike in oil prices, as tensions in the Middle East rose, and markets fear a prolonged supply disruption via Iran, sent inflation fears rising again and weighed on market sentiment.
Meanwhile, mega-cap tech earnings have highlighted a key point: profit momentum is still perceived as very strong, particularly with regard to AI-driven cloud usage and semiconductor demand, but increased capex here is increasingly being interpreted negatively. Alphabet shares fared much better than Meta’s as their cloud AI strategy is somewhat balanced by lower, declining capex. Amazon also forecasted a more muted full-year capex spend as a tailwind to its otherwise high build-out costs.
On the chart, SPX price has been trading in a rising channel and is maintaining above the midline, so the structure remains broadly bullish above 7,105. A break higher above 7,180 would likely trigger a move to retest 7,205-7,220 near the upper channel. A failure below 7,105 puts 7,075 and channel support at risk, followed by 7,050, which, if convincingly broken would shift the short-term bias to bearish.
Gold and Silver
Precious metals continued their slide yesterday as energy prices neared their wartime highs during March and the US Fed held rates steady at the range of 3.50-3.75%, leaning to a hawkish tilt. This has driven treasury yields higher, weighing on nonyielding assets such as gold and silver. Gold lost 1.1% yesterday and is trading near $4,600 in today’s session. Silver closed 2.3% lower yesterday near $71. It is reversing yesterday’s losses, but upside momentum remains limited. The bias for both metals remains to the downside. Both metals are headed for a second month of closing in red.
Fed’s overall tilt suggests a wait-and-see approach. This meeting revealed a deepening division over the outlook for policy. Four officials voted against the decision, including three who objected to language in their post-meeting statement that suggested the central bank would eventually resume cutting rates. The 8-4 vote marked the first time since October 1992 that four officials dissented against a Federal Open Market Committee decision. Also, Jerome Powell said he intends to remain on the central bank’s board of governors. He clearly stated that he will not leave until a controversial criminal investigation into the central bank is truly over with transparency and finality. This complicates Kevin Warsh’s path to lower rates. He will take over as Fed chair next month. Traders priced out rate cuts from 2026 and added to the bets that the Fed will increase rates in 2027. The US dollar rose against most of its peers, with the DXY index slightly over $99. All of this weighs negatively on gold and silver. Exchange-traded funds cut 122,960 troy ounces of gold from their holdings in the last trading session, bringing this year’s net sales to 183,669 ounces, according to data compiled by Bloomberg. The sales were equivalent to $565.2 million at yesterday’s spot price.
Technically, gold faces overhead resistance in the $4,640-$4,660 zone. The 100-day EMA at $4,650 appears to be a key hurdle on the upside. The next important resistance level is at $4,700. On the other side, support is likely at the $4,550 level. A break lower from here could bring the $4,500 level in play. An RSI reading of 40 indicates little scope for strong upside moves today. For silver, overhead resistance is at $74, with possible support at $71.
