Daily Global Analysis By zForex

[Z Forex]

Daily Analysis by zForex Research Team - 20.05.2025​

Risk sentiment shifted this week as Moody’s downgraded the US credit rating, weakening the dollar and supporting major currencies and commodities.

The euro climbed toward $1.13 on both the downgrade and a tentative EU-UK post-Brexit deal, while the yen held firm despite Japan’s Q1 contraction. Gold and silver retreated as hopes for a Russia-Ukraine ceasefire eased safe-haven demand. Meanwhile, the British pound rallied past $1.336, backed by strong GDP growth and optimism over new UK-EU trade cooperation. Market focus now turns to upcoming Fed speeches and trade negotiations.

EUR/USD Analysis by zForex Research Team - 20.05.2025​

US Credit Downgrade and Brexit Progress Lift Euro​

The euro approached the $1.13 mark on Tuesday, extending its rebound from the one-month low recorded on May 12. The rally followed a broad-based weakening in the US dollar after Moody’s downgraded the US credit rating from Aaa to Aa1, citing mounting government debt and widening fiscal deficits. The downgrade sparked investor concerns about long-term US economic stability and pressured dollar-denominated assets.

The EU and UK finalized a provisional agreement addressing key post-Brexit issues such as defense, fisheries, youth mobility, and security cooperation. The deal may pave the way for UK companies to participate in major EU defense projects, marking a potential turning point in EU-UK relations.

The European Central Bank is expected to initiate a rate cut in June, with additional easing possible later in the year. Despite these expectations, the euro has held firm, buoyed by both geopolitical developments and dollar weakness.

EUR/USD now faces resistance at 1.1260, with further upside barriers at 1.1460 and 1.1580. Support lies at 1.1040, followed by 1.1000 and 1.0960.

Gold Analysis by zForex Research Team - 20.05.2025​

Gold Slips with Ceasefire Hopes​

Gold declined below $3,320 per ounce as hopes for a ceasefire between Russia and Ukraine reduced the appeal of safe-haven assets. The drop followed a statement by US President Donald Trump announcing that both nations had agreed to "immediate" talks, potentially without US involvement, after a conversation with Russian President Vladimir Putin.

On Monday, gold had gained 0.6% in response to Moody’s downgrade of the US credit rating to Aa1 from Aaa, which raised concerns about long-term debt sustainability. However, with geopolitical tensions easing and investors awaiting fresh comments from Federal Reserve officials, gold reversed course.

XAU/USD now finds resistance at $3,250, with further levels at $3,300 and $3,350. On the downside, support is seen at $3,120, followed by $3,030 and $2,956.

 

[Z Forex]

Daily Analysis by zForex Research Team - 21.05.2025
Silver Holds Strong as Dollar Falters​

EUR/USD pushed higher toward 1.1330, lifted by a weaker dollar and cautious optimism around U.S. tariff de-escalation.

The Japanese yen gained strength, slipping USD/JPY below 144.00 as bets on a BoJ rate hike grew. Gold reclaimed ground above $3,300, fueled by renewed U.S. deficit concerns and G7 trade tensions with China. GBP/USD climbed toward 1.3400, with traders awaiting key UK inflation and PMI data, while silver hovered near $33.10.

GBP/USD Analysis by zForex Research Team - 21.05.2025
GBP/USD at 1.3400, PMI Data Awaited​

GBP/USD edged higher toward 1.3400, supported by dollar softness and cautious optimism before UK economic data. Markets are awaiting April’s CPI on Wednesday and both UK and U.S. PMI data on Thursday.

Trade developments remain a major driver of sentiment, with investors hoping the U.S. administration will scale back tariff threats, though little progress has been seen with the 90-day deadline approaching.

UK inflation is expected to rise, with monthly CPI seen at 1.1% and annual CPI reaching 3.3%, while core CPI may tick up to 3.6%. Thursday’s PMI data could further influence the pair, with modest UK strength and mixed U.S. figures forecast.
Resistance is at 1.3450, with higher levels at 1.3550 and 1.3700. Support stands at 1.3250, followed by 1.3150 and 1.3000.

Silver Analysis by zForex Research Team - 21.05.2025
Dollar Weakness Supports Silver at $33.10​

Silver hovered near $33.10 on Wednesday after a strong Tuesday rally, supported by broad dollar weakness and renewed demand for the metal. Uncertainty over U.S. trade policy, Moody’s downgrade of U.S. debt, and fiscal concerns have all contributed to the metal’s gains.
Despite easing slightly from session highs, silver maintains upside potential in the near term.
Resistance is located at $33.80, with further targets at $34.20 and $34.90. First support is found at $32.30, followed by $31.40 and $30.20.

 

[Z Forex]

Daily Analysis by zForex Research Team - 22.05.2025​

Euro and Pound Rise on U.S. Fiscal Worries
The euro and British pound extended their rallies on Thursday amid mounting concerns over the U.S. fiscal outlook, following Moody’s downgrade of the U.S. credit rating.

Gold and silver gained for the fourth and third consecutive sessions, respectively, supported by safe-haven flows and geopolitical tensions. The Japanese yen strengthened to a two-week high, while the dollar index slipped below 99.50 as investors digested tax policy risks and upcoming PMI releases.

EUR/USD Analysis by zForex Research Team - 22.05.2025​

Euro Extends Rally Ahead of PMI Data
EUR/USD trades near 1.1340 during Asian hours, close to two-week highs, extending gains for a fourth session ahead of Eurozone PMI data expected to show improved growth for May.

The U.S. dollar remains under pressure as markets await Thursday’s S&P Global PMI. Moody’s downgraded the U.S. credit rating to Aa1, matching earlier cuts by Fitch and S&P, citing rising debt, projected to reach 134% of GDP by 2035, and a nearly 9% deficit.

Trump’s tax-cut plan cleared the House Rules Committee, but the DXY still trades lower near 99.50.

The key resistance is located at 1.1390, and the first support stands at 1.1260.

USD/JPY Analysis by zForex Research Team - 22.05.2025​

JPY Hits 2-Week High as Dollar Weakens
The Japanese yen strengthened to around 143 per dollar on Thursday, its highest in over two weeks, as concerns over the U.S. fiscal outlook pressured the dollar. Fears that Trump’s proposed tax cuts could add over $3 trillion to U.S. debt weighed on investor confidence.

Japan’s Finance Minister Kato said he did not discuss currency levels with Treasury Secretary Bessent at the G7 summit.

Domestically, core machinery orders surged 13% in March, beating expectations of a 1.6% drop, while May PMI data showed continued weakness in both manufacturing and services.