US equity markets closed higher on Friday with a 0.91% gain for the SPX index and a 2.45% gain for the NDX index. The SPX index has risen 2.42%, while the NDX index rose 5.64% during the last week. Markets were trading slightly lower during the Asian session on Monday, with both indices down about 0.10%.
US markets marked the sixth consecutive week of gains, extending into fresh all-time highs, and recorded a sharp recovery since the peak drawdown from fears of a wider Middle East conflict. Friday’s non-farm payrolls report indicated a stronger-than-expected 115,000 jobs added in April, well above the 65,000 expected, contributing to strong bullish sentiment for equities. However, updates on US-Iran ceasefire plans over the weekend may impact risk sentiment. President Trump indicated his dislike of Iran’s response to a proposal to end the war, sending oil prices back up with WTI crossing above the $100 mark again, while Brent traded near $108. Despite this, equities remain relatively strong, with futures trading only slightly lower, indicating the robust bullish momentum recently.
From a technical perspective, the SPX and NDX indices continue to trade within a strong market structure tilted to the upside, significantly above all key moving averages on the daily, weekly, and monthly timeframes. However, a significantly stretched rally and the RSI trading above 70 in the overbought territory may prompt some profit booking or consolidation in the short term. For the SPX index, potential short-term resistance may develop near the 1.618 fib-retracement level at the $7543 mark, while the 9-day EMA may provide support near the $7298 mark.
U.S. Dollar Index
The US Dollar Index witnessed a weak performance overall last week, declining around 0.38%, as crude oil prices also plunged more than 8% amid hopes that geopolitical tensions in the Middle East would ease and oil flows would gradually resume. However, sentiment shifted sharply after Friday’s close as geopolitical risks resurfaced, supporting safe-haven buying in the Greenback. The Dollar Index is currently trading higher by around 0.30% near the $98.10 mark, while crude oil prices have rebounded nearly 5% after US-Iran peace talks reportedly stalled.
The dollar climbed during the Asian session on Monday after reports suggested that negotiations between the United States and Iran had reached a deadlock, raising concerns over continued disruption risks around the vital Strait of Hormuz. Adding to the tensions, President Donald Trump rejected Iran’s response to a US proposal aimed at ending the conflict, calling Tehran’s demands totally unacceptable.
The US Nonfarm Payrolls data, which showed the economy added 115,000 jobs in April against forecasts of 62,000 while the unemployment rate remained stable at 4.3%, is also boosting the US Dollar as the resilient labour market has reduced the expectations of aggressive Federal Reserve rate cuts.
On the cross-currency part, USD/JPY’s upside may remain limited as markets closely watch US Treasury Secretary Scott Bessent’s visit to Japan, with expectations rising that Japanese authorities could step up yen-buying intervention efforts to support the Yen and limit further Dollar strength.
Technically, the intraday view for the US Dollar Index remains bullish as long as prices hold above the key support level of $97.61. As long as the index trades above this level, the overall price action continues to favour upside momentum for the day. Immediate resistance is seen at the 9-Day SMA near $98.26, followed by the next major resistance around the 50-Day SMA near the $99 mark. On the downside, immediate support is at $97.82, which is last week’s low, followed by the next key support level of $97.61. The EUR/USD is currently trading at 1.1761, down by 0.22% for the day. Immediate support is at the last week’s low at 1.1676, and resistance is at 1.1808.
Today, oil prices surged after Trump rejected Iran’s proposal, raising fears that tensions in the Middle East could continue. Brent crude jumped around 4.5% to $108, while WTI gained nearly 5% to trade around $100.
Crude prices rose last week as the market continued to price in a supply disruption that may be more prolonged. Talks between the US and Iran do not seem to be getting anywhere, with Trump rejecting Iran’s response and casting doubt about any imminent return to normalcy in the Strait of Hormuz. Tanker traffic remains limited, an indication that the route is under tight risk control, rather than resuming business as usual.
Meanwhile, oil inventories worldwide are hovering near historically low levels, tightening supply and widening the spread between Brent and WTI crude prices. Since inventories would take time to recover even if tensions de-escalate, oil remains susceptible to upside breakouts.
According to analysts, the world has been using 10–13 million barrels of oil from storage every day, with around 500 million barrels already removed from global inventories since the conflict began. The actual supply loss could be even larger, at around 600 million barrels since March.
Brent and WTI oil prices have moved in three clear phases since mid-February. First, prices surged sharply from around $65/$70 to $120, showing very strong bullish momentum. Then the market entered a volatile consolidation phase. While the rebound after the late-April pullback showed buyers were still active. The latest phase began with a sharp selloff on May 6, but crude oil quickly recovered, rebounding toward current levels. This recovery keeps the bullish trend intact.
The chart shows that the last few 4-hour candles are beginning to signal some rejection following the significant rise driven by the news, but the trend remains bullish. For WTI, the first resistance is at $103, where the 9-day SMA crosses, but if there is a larger rise, the target is around $106. On the support side, the first key level is around the 50-day SMA at $96.
For Brent, the price could continue in a range between resistance at around the 9-day SMA at $110 and the support level at around the 50-day SMA at $105, while stronger breakout resistance is seen at around $111.
Gold remains under pressure at the start of the week, slipping toward $4,670 (-0.9%) in Asian trading as fading hopes for a near-term US-Iran peace agreement have kept oil prices elevated and reinforced higher-for-longer rate expectations. President Trump’s rejection of Iran’s latest proposal, alongside ongoing disruptions around the Strait of Hormuz, has intensified inflation concerns and supported the US dollar, weighing on non-yielding assets like bullion.
US Nonfarm Payrolls came in at 115K, beating the expected 65K and supporting a higher-for-longer rate view, which has added pressure on gold. However, underlying demand trends look positive. The World Gold Council reported that global gold ETFs saw inflows of over $6.6 billion in April, after March’s outflows. China and Hong Kong led this renewed interest in safe-haven assets. Central banks, especially the PBOC, continue to buy gold, helping to support prices. While gold’s short-term direction depends on real rates and the dollar, stronger inflows suggest the risks may be shifting to the upside, especially if global yield pressures ease. Investor attention is now focused on April’s U.S. Consumer Price Index data, due tomorrow, for further clues on the Fed’s monetary policy direction.
On the daily chart, gold remains rangebound with a cautiously bullish bias if it sustains above the 50% Fib level and the 9 EMA around $4,650-$4,655, which also serves as a support range. Resistance may be seen at $4,700. A sustained break above this level could open the path toward the 61.8% Fib level at $4,745. Silver has seen strong momentum over the past five sessions and remains bullish in the near term. Support lies around $78.30 with possible resistance at $83.00, a previously tested level.
