The Canadian Dollar remains stable against the USD, trading at the midpoint of this week’s range. Yield spreads attract attention due to recent US data impacting Fed policy and oil prices help stabilise the USD/CAD estimate at 1.3970.

The domestic calendar offers limited data with March’s international securities transactions and CPI scheduled for next week. BoC Governor Macklem is set to speak next Thursday during the G7 meeting in Banff.

Technical Analysis

USD/CAD has resistance above 1.4000 with support around 1.3900. RSI levels have become neutral, indicating momentum loss, with the 200-day MA at 1.4021 remaining a key level.

Recent congestion centres around the 61.8% retracement of the September-February rally. Readers are cautioned about the risks and uncertainties and advised to conduct their own research before making investment decisions.

What we’re seeing at the moment is a market holding steady, almost caught in a quiet tug-of-war, where neither buyers nor sellers seem confident enough to take the lead. The Canadian Dollar hasn’t strayed far in either direction, and this isn’t entirely surprising when you consider how external factors have been playing their role more than anything on the domestic front. It’s fewer fireworks and more of a slow burn.

With the differential in interest rates still guiding broader directional flows, yield spreads have taken on an outsized influence — especially with recent American economic indicators feeding debate around the Federal Reserve’s next move. Inflation data in the United States has been pushing expectations one way, then the other, which in turn filters down to where participants believe rates should sit. These yield moves are making traders pay real attention because they affect the comparative value of the Canadian Dollar, particularly in relation to USD pairs like USD/CAD.

Energy markets have added another layer of stability here. Oil prices, mostly consistent over the past few sessions, have reinforced the hold near the 1.3970 level. For Canada, where crude exports dominate the balance sheet, this matters. It’s giving a sort of artificial comfort to the exchange rate, tempering downside momentum if only for now.

Upcoming Data and Trends

As for what’s coming in the data pipeline, it’s fairly lean from the Canadian side. That doesn’t mean it can be ignored; it just means focus will be sharper on what little’s there — most notably March’s international securities flows and April’s CPI. These might not be game-changers by themselves, but they will offer some colour to otherwise quiet domestic conditions. The appearance by Governor Macklem at the G7 could stir some reaction if he hints at any deviation from expectations, especially on interest rates or inflation targets. His recent tone has been cautious, so any shift would catch notice.

Technically, we’re in a holding pattern with USD/CAD. Resistance near 1.4000 remains solid and hasn’t given up ground. On the lower side of things, 1.3900 is acting like a safety net for now. Traders looking at the RSI will see it hovering around neutral – neither overbought nor oversold – which aligns with price movement that’s largely lacked direction. The 200-day moving average at 1.4021 hangs above as a clear technical marker – and until price tests and either rejects or clears that line convincingly, momentum probably won’t pick up.

Interestingly, the pair seems to have anchored itself near the 61.8% retracement from the broader move seen between September and February. That’s not nothing – those levels tend to attract attention and often act as pivot points, giving traders a sense of where the underlying trend might resume or break down.

In this setup, where ranges are holding and catalysts are limited, we choose to watch breakouts closely but avoid overcommitting ahead of confirmation. Risk-reward setups are increasingly tilted toward neutral or mean-reversion strategies over directional trends. Unless something outside expectations hits – either from south of the border or from Canadian policy shifts – it’s prudent to track sentiment around US yields and oil prices as the primary inputs.

Price watchers and crossover traders will want to flag the first close above 1.4021 or below 1.3900 as a possible launchpad or trap depending on volume. Until then, biases might be better held with a light grip.

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Raphael Bostic, a Federal Reserve policymaker, anticipates just one rate cut this year amidst ongoing economic uncertainty. He forecasts economic growth between 0.5% and 1%, with no expected recession in his outlook.

Bostic notes that inflation pressures, particularly those stemming from tariffs, may require additional measures. He suggests that the recent de-escalation in US-China trade tensions adjusts his outlook slightly.

A Hawkish Stance

Although Bostic has consistently taken a hawkish stance, he is not a voting member this year. Market participants might need to reconsider inflation risks and potential changes in rate cut expectations.

Bostic’s statement serves as a reminder that despite popular expectations of multiple rate reductions, the central bank is not fully convinced that inflation is under control. With projected growth kept firmly below long-term averages and no recession flagged in his base case, Bostic keeps the Fed’s foot carefully on the brakes but not off the pedal entirely. His view suggests policymakers are still watching price data very closely and may wait longer than markets expect before taking further action.

The mention of tariff-induced price pressures being a continued concern adds another layer. Even as geopolitical tensions lessen — notably between the US and China — the long tail of prior measures may still filter through to inflation readings. This contributes to sticky conditions which are not easily shaken off by temporary de-escalations in foreign policy.

Conditional Rate Cut Projection

What stands out is not just his projection of a single cut in 2024, but the conditional nature of it. It’s not locked in. Instead, it hinges on forthcoming reports and whether current efforts produce progress in bringing core inflation nearer to target. Rates thus remain high for longer, and policy seems pinned to actual data more than sentiment.

If we are looking ahead, we ought to treat rate cut bets with restraint. Pricing in aggressive easing based only on past expectations leaves the door wide open to repricing risk — particularly if inflation-related releases don’t weaken enough or if growth data picks up a touch more strongly.

Markets may need to walk slowly in the near term. Consider what happens if labour figures, for instance, remain resilient. Equally, if spending stays firm, policymakers could stay patient, arguing that household demand hasn’t softened as needed. Strong economic prints would quickly take the legs out from under future cut assumptions.

Given that Bostic isn’t casting votes at the moment, his comments don’t directly determine immediate decisions, but his tone and framework do reflect broader thinking within the central bank. Especially when his baseline differs so sharply from what’s embedded in current forward curves. That puts pressure on us to check whether those assumptions are still justified.

In the weeks ahead, we should resist leaning into trades built solely on hope of quicker easing. Look instead for stronger confirmation. Not just from one inflation release, but across employment, consumer habits, and supply indicators. If they break lower all at once, then central bank support may come sooner. But until then, the burden is firmly on the data to move the dial.

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The Pound Sterling continues its ascent against the US Dollar, reaching near 1.3330 in the European session. This movement follows softer-than-expected US Producer Price Index data and weaker Retail Sales, which resulted in a decline in the US Dollar Index to around 100.50.

The US Producer Price Index indicates a drop due to a slowdown in sectors like hospitality, with notable impacts from reduced tourist activity. Retail Sales showed a minimal increase of 0.1%, a sharp decline from the previous month’s 1.5%, influenced by anticipated tariff changes. These factors contributed to a decrease in 10-year US Treasury Yields from a high of 4.55% to approximately 4.40%.

Us Federal Reserve Expectations

Despite this, market expectations for steady US Federal Reserve interest rates remain high, as reflected in CME FedWatch tool probabilities. Eyes are now on the upcoming US Consumer Sentiment Index and inflation expectations data.

In the UK, the Pound Sterling retraced against other major currencies after positive GDP data release, except against the US Dollar. This growth suggests the Bank of England might maintain current interest rates. Traders await UK CPI data for further insight into inflation and future rate decisions.

The technical outlook shows the GBP/USD pair above the 20-day Exponential Moving Average with a Relative Strength Index range from 40.00-60.00. The pair faces resistance at 1.3445, with support at the psychological level of 1.3000.

This recent move in the pound pushing close to 1.3330 reflects more than just a moment of dollar weakness. The softer-than-expected Producer Price Index in the US, tied mainly to faltering demand across hospitality and retail-related sectors, was enough to jolt market sentiment. A monthly retail sales figure rising only 0.1% — nowhere near last month’s surprising 1.5% surge — has done little to inspire confidence. The weaker data points suggest consumers are reacting early to foreign trade policy expectations, particularly around tariffs, and that spending patterns may have already started adjusting.

With this shift, we’ve seen the 10-year Treasury yield roll off its recent highs, now hovering closer to 4.40%. More than just a symptom of those economic reports, the yields are also implicitly signalling that strength in the economy may not be enough to justify any further Fed tightening. Still, futures markets haven’t yet priced in rate cuts anytime soon, according to implied probabilities on the CME FedWatch tool. In other words, the option of holding steady remains the dominant view, and it is being priced that way.

Sterling And Gdp Data

Domestically, Sterling’s gains haven’t been across the board. The positive GDP data released recently gave the pound a minor boost against global peers, but its continued run against the dollar seems to hinge more on dollar softness than an outright endorsement of UK growth prospects. That said, an economy showing some forward movement does suggest the Bank of England might not feel the need to react urgently. Current rate levels may last longer than initially expected.

We’re waiting now on CPI data in the UK, which comes with weight, and should indicate whether inflationary pressure is starting to ease or holding steady. Either outcome could potentially shape how markets reprice interest expectations in the weeks ahead. From where we sit, expectations for swift intervention have been dialled back; unless the CPI results deliver an abrupt surprise, rate guidance may stay in its current range.

On the chart, the pair remains relatively stable above its 20-day EMA. The RSI sitting between 40 and 60 doesn’t indicate any sharp imbalances in buying or selling pressure, which typically means short-term price action will need a clearer fundamental catalyst. In terms of ranges we’re watching, immediate resistance can be seen near 1.3445 — with no break above that, any move higher might struggle for momentum. On the other hand, the psychological 1.3000 level offers a clear support floor traders may use to gauge reversal potential or extension to downside.

In derivative spaces, pricing has become more reactive to short-term data shocks. With consumer sentiment and inflation expectations in the US set to print soon, we might see some recalibration in rate expectations — even subtle downward revisions — that could offer temporary tailwinds. Positioning bias should remain balanced unless there’s a notable shift in rate statements or surprise elements in the incoming data. As it stands, directional conviction remains data-sensitive and skewed slightly by recent dollar softness rather than domestic sterling strength.

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Italy’s final Consumer Price Index (CPI) for April shows a year-on-year increase of 1.9%, compared to the preliminary estimate of 2.0%. The previous month’s data also reflected a 1.9% rise. The Harmonised Index of Consumer Prices (HICP) shows a 2.0% increase, down from the preliminary 2.1%, with the prior data also at 2.1%.

There was a slight delay in the data release by Istat. Core annual inflation accelerated to 2.1%, up from March’s 1.7%. The rise is partly due to a notable increase in services inflation, which climbed to 3.0% from the previous month’s 2.5%.

Italy Inflation Pressures

This data tells us that inflationary pressures in Italy remain sticky, rather than declining at a steady pace. The country’s overall price growth, as measured by the Consumer Price Index, stayed level with the figure recorded in March, despite being revised slightly downward from initial projections. What’s more instructive here is the upward shift in the core inflation figure. Once volatile components like energy and unprocessed food are stripped out, the underlying trend in prices becomes clearer—and here, it shows signs of acceleration.

The increase in core inflation to 2.1% from 1.7% shouldn’t be overlooked. This move was largely fuelled by stronger price growth in services, now ticking up to 3.0%. In services-heavy economies, such dynamics often indicate persistent inflation rather than the kind that fades quickly. For us, this adds weight to positioning strategies that are sensitive to price trends over medium timeframes. Higher services inflation can point to stronger wage growth or demand resilience, potentially feeding into expectations for monetary policy shifts.

Looking at the Harmonised Index of Consumer Prices, which is used for comparison across the eurozone, the small revision lower from 2.1% to 2.0% might seem minor, but paired with the stickier core, it paints a more complex picture. It suggests that while total inflation is perhaps flattening, what sits beneath the surface is building pressure. This divergence between headline and core measures could introduce new volatility, particularly around rate-sensitive instruments.

Core Inflation Impact

Let’s break this down further. Core metrics are better guides for what central banks care about when setting policy. When core growth pushes higher, it brings forward the likelihood of a less accommodative response. That matters because pricing of forward rate expectations may become misaligned with central guidance if core readings continue in this direction. As a result, we believe it’s worth preparing for shifts in sentiment tied to suddenly improving or deteriorating core measures, not just changes in the headline figure.

The delay in Istat’s release might not affect market reaction directly, but it’s another reminder of how data lags can distort balance and timing. The market depends on rhythm, and delays in reporting affect that rhythm. While not a trigger in and of itself, postponed data still has the potential to skew short-term positioning when calendars are packed.

As we assess the weeks ahead, these revised numbers lean toward firmer inflation expectations in the absence of immediate disinflationary catalysts. Existing rate path assumptions, particularly those that were built on the idea of falling inflation by spring, might now look too aggressive. This could leave some forward-looking exposures vulnerable unless they are adapted quickly.

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OPEC maintains its forecast for an increase in oil demand by 1.3 million barrels per day for this year and the next. However, the trade conflict presents demand risks, urging cautious treatment of these forecasts.

The organisation has also lowered its expectations for non-OPEC+ oil supply. The reduction in supply is influenced by lower oil prices, which hinder the expansion of US oil production.

Impact Of Supply Deficit

According to OPEC, this situation could result in a supply deficit, offering room for a boost in OPEC+ oil production. Despite this possibility, there is criticism regarding the optimistic nature of these demand forecasts.

The information provided contains forward-looking statements with risks and uncertainties. It should not be construed as a recommendation to engage in buying or selling these assets without thorough personal research.

Ensuring accuracy and timeliness of this information is not guaranteed, and the responsibility of any investment risks, including complete loss, lies with the individual. Investing in open markets involves significant risk and potential emotional distress.

Challenges In Forecasts

The latest statement from the Organisation of the Petroleum Exporting Countries (OPEC) maintains a forward-looking stance on oil demand growth, projecting a daily increase of 1.3 million barrels this year and next. While on the surface this speaks to expectations of stable or improving economic activity across certain regions, underlying tensions around global trade disputes complicate the picture. The suggestion here is not a certainty of continued demand growth, but rather a cautiously optimistic outlook, one that assumes current macroeconomic tensions will not worsen markedly.

That said, non-member supply is being revised downward. Particularly, production from outside the alliance, especially the United States, is expected to slow. Lower prices seem to be directly limiting upstream investment, which is the process of drilling and developing new oil sources. This suggests that companies are pulling back on aggressive drilling initiatives, especially where projects no longer remain profitable under compressed margins. These are not small players either—the pullback is apparent even among major US producers with formerly robust supply pipelines.

Reading this together, we see the possibility for a tighter supply environment in the near term. A drop in output outside the OPEC+ alliance, paired with steady or slightly growing demand, could result in undersupplied markets—at least temporarily. That opens the door for the alliance to revise its own output restrictions, possibly increasing production to stabilise prices or maintain its market share. Yet scrutiny continues over whether the demand estimates are overly inflated, potentially underestimating the drag from higher global interest rates, slower economic growth in China, and uncertainties around energy transition goals.

Now, for those navigating futures and options across the energy complex, we notice over-reliance on optimistic demand figures introduces asymmetric risk. In strategy planning, what appears to be an easy assumption of upward price motion could be challenged bluntly by unforeseen demand weakness. Risk here is not hypothetical—it translates into real capital movement and pricing pressure as positions rebalance.

We’ve started seeing wider volatility bands on longer-dated oil options, especially across Brent contracts. That’s not a coincidence, but a reflection of mounting friction between supply-and-demand forecasts and real-world macroeconomic signals. The implied volatility tells us positioning is becoming more defensive, not less. There’s no denial of the supply risks or isolated demand strength from emerging regions, but clearly, the distribution of outcomes has broadened.

Compounding this are mixed signals across commodity-linked equities. Some of the energy majors are rolling back capital expenditure estimates, while others press on, expecting a higher price floor in the second half of the year. Disparities like these point to a fractured consensus, making it harder for directional positions to hold without wider downside covers.

For us, the challenge is not deciding whether oil will rise or fall, but adjusting probability weights carefully over the weeks ahead. Probabilities that shift too slowly become liabilities. This is a low-conviction moment with a high cost of being wrong. Position sizing needs discipline—overshooting conviction, whether towards a bull or bear bias, risks amplifying volatility drawdowns.

Keep in mind that even if OPEC were to adjust its official output upward, timing matters. Delays or poorly coordinated communication could result in abrupt price dislocations. We’ve watched this happen before—orders and compliance don’t always travel at the same speed.

So attention now may shift more closely to inventory builds, shipping volumes, and rig counts from non-aligned producers. These hard datapoints shape expectations more than verbal guidance. They also serve as early warnings for inflection in supply. We would expect large desks already to be increasing hedging ratios, especially in structurally exposed sectors.

This is also the first time in several quarters where realised volatility across energy commodities started to exceed implied, albeit modestly. That warrants close observation. It means the modelled expectation is being outpaced by market moves themselves. Expect this to influence rehedging timelines and reset spreads across energy complex options.

As always, clear asymmetries are rare. But misalignment between stated expectation and actual production or consumption figures—particularly across major importing economies—will create free-form adjustments in the derivatives space. Participants who can remain adaptive to these gaps will outperform those anchored to headline outlooks alone.

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State-owned media suggests that a 90-day window may not suffice for meaningful outcomes, arguing the need for extended cooperation beyond this period. The media expresses hope that recent talks’ outcomes will encourage the US to continue meeting China halfway.

A 90-day period is expected to be subjective rather than a strict deadline, allowing for extensions if negotiations progress. Any extension would depend on the US’s patience, particularly if President Trump does not lose patience with China.

Beijing’s Negotiation Approach

Analysts indicate that Beijing may not hurry to detail how it will fulfill its commitments. There may be limited clarity on non-tariff barriers as both sides remain engaged in discussions.

Even the emergence of purchase agreements or similar outcomes may not signify substantial progress. There are concerns about repeating the unfulfillments of the previous Phase One trade deal.

The article is assessing the real prospects of progress in discussions between the United States and China, with an emphasis on the trade relationship more than anything else. At the core is the notion that a stated 90-day period for talks is not so much a cut-off as it is a flexible checkpoint, which opens room for delay if discussions appear to be going somewhere. That’s a nod toward realism rather than optimism—most probably because there’s an understanding that these kinds of negotiations do not stick to round numbers or tidy calendars.

State-linked commentators suggest that more time is needed to get useful results, with expectations dialed down accordingly. What is implicit here is a wider recognition that the key outcomes won’t necessarily come in the form of grand agreements or immediate action. The emphasis seems to be placed more on gestures and intent, which makes reading timelines tricky.

Implications For Market Behavior

It’s noted that there hasn’t yet been clarity about how policy promises would become operational, particularly on the subject of non-tariff barriers. These can often cause more difficulty than tariffs themselves because they include regulations, standards and informal policies that are harder to measure or address in simple trade terms. The suggestion is that both sides remain guarded, unwilling to show their full positions too early. That means participants in related markets should expect a fair amount of ambiguity in the near term.

Of particular importance here is the mention of previous unkept promises, especially those linked to the earlier Phase One deal. The concern is that early signs of agreement—reduced tariffs or bulk commodity orders—could be read too eagerly as signals of resolution. These kinds of cues have led markets astray before, so it’s reasonable to expect a more tempered reading of headlines this time.

For ourselves, what becomes more relevant is not the confirmation of agreements, but what’s left unsaid. Delays in giving specifics, particularly around non-tariff policies or enforcement mechanisms, can lead to uneven movements in pricing models and shifts in implied volatility. We should therefore review short-dated implied vol in key currency pairs and commodities with a closer eye, particularly in instruments relying on sentiment versus substance. When rhetoric drives positioning more than actual flows, there’s an increase in fragility for structured products and calendar spreads.

That said, we shouldn’t over-position based on the assumption of continued goodwill. The message is fairly clear: a pause or slowdown in new negotiations could happen abruptly, especially if political pressure builds elsewhere. In scenarios like this, short gamma positioning might be more dangerous than it appears. Reviewing correlated exposures—particularly those that share sentiment dependence—could help reduce unwanted surprises tied to sudden narrative shifts.

It’s also worth noting the absence of new compliance or verification protocols being agreed upon. Without those, any forward-looking agreement is still essentially verbal. That’s a kind of uncertainty that doesn’t show up in macro indicators right away, but matters greatly when pricing quarterly volatility or structuring iron condors or risk reversals. We often find that the quieter periods, when concrete news is lacking but posture is softening, offer the best setups for skew rebalancing.

Looking at the statement again, one insight stands out: there remains a deep hesitation to commit to an enforceable timeline. That hesitation, if prolonged, could delay any expected improvement in bilateral purchase flows or changes to licensing rules. This affects not just trade volumes, but operational confidence for cross-listed firms, too. Anyone positioned through ADRs or sector ETFs linked to manufacturing or base materials might want to reassess their timing models through the lens of regulatory slippage.

As we monitor public commentary, we should remember that extended dialogue without substance tends to cool implied rates more than it affects underlying exposure. This can make longer-term spreads flatter, even while short-term IV remains constrained. In our opinion, that’s a condition worth preparing for now, if not actively positioning around already. Fast shifts in tone can be disruptive, but slow progress wrapped in hopeful language requires just as much discipline.

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Warren Buffett’s Berkshire Hathaway has released its 13F filing for Q1 2025, showing ongoing trends in stock management. The firm continued to reduce exposure to financial stocks, increased stakes in consumer businesses, and maintained a cautious approach to deploying cash reserves.

No new stocks were initiated, but notable increases were seen in Pool Corporation and Constellation Brands. Berkshire fully exited Citigroup and Nu Holdings and reduced positions in banks such as Bank of America and Capital One.

Berkshire kept its largest holding, Apple, unchanged for the second quarter. Apple remains valued at $66.6 billion, reaffirming its position as the portfolio’s largest single asset.

A confidential filing with the SEC suggests a new investment in the commercial or industrial sector worth between $1 billion and $2 billion. This follows Berkshire’s strategy of discreetly building positions in the past.

Berkshire’s cash reserves and Treasury holdings reached a record $348 billion, earning passive income and awaiting suitable investment opportunities. Key increases were made in Pool Corporation and Constellation Brands, focusing on consumer and housing-adjacent sectors with strong demand. The firm’s cautious stance towards financials persists, with ongoing reductions in banking stocks due to perceived macro risks.

The recent 13F disclosure from Berkshire Hathaway offers a clear window into current priorities around capital allocation. While financials had long been a core part of the portfolio, those positions are now being pared down. Reductions in large banks like Bank of America and Capital One are not isolated to a short-term shift—they likely reflect a broader view on the sector’s risk profile, given tighter credit conditions, prolonged rate uncertainty, and earnings pressure across balance sheets.

Citigroup and Nu Holdings no longer appear on the books, which reveals a complete lack of interest in holding through potential headwinds in those specific models. That departure wasn’t offset by any new sector-wide additions—instead, attention has turned again to segments where demand looks more stable. Investments were deepened in Pool Corporation and Constellation Brands, two companies with exposure to consumer resilience and housing-adjacent activity. We’re seeing clear signs that the emphasis is on names with pricing power and consistent cash flows. These aren’t speculative bets.

It is also essential to acknowledge that no new public equity positions have been opened, which supports the reading that Berkshire continues to wait. Deploying new capital remains on hold, and with $348 billion sitting in cash and Treasuries, that reserve now stands higher than ever. Passive income from those assets adds stability, but it also shows the decision to prioritise optionality over urgency. When you’ve spent a lifetime building war chests, you learn not to fire too early.

Apple’s unchanged allocation—still the largest holding by far—should not be interpreted as emerging favouritism or complacency. Instead, it reflects confidence in core earnings durability and long-term relevance. Whether valuation has grown too rich is beside the point when the strategic value, both as an anchor and a counterbalance, remains as firm as ever in the broader portfolio.

The confidential filing hints at movement elsewhere. An investment somewhere between $1 billion and $2 billion in a commercial or industrial name has been lodged with the SEC under a confidential designation. That suggests we may see a new position disclosed in a coming quarter, likely the result of patient accumulation. This discretion has been used before to avoid front-running and to protect sensitive deal-making.

In our view, high levels of cash, zero appetite for new financials, and targeted builds into economically sensitive defensives like consumer products all point to a very selective environment. There is no general retreat, but there is no full-throttle risk-taking either. For those of us working with derivatives, this means implied volatility on large-cap financials and housing-linked stories will need closer inspection. Options volume may continue shifting into consumer names where Berkshire is scaling up. We might also expect lower gamma exposure around banks going into earnings season, as the largest long players step back.

Short-term flow should not be mistaken for long-term conviction. We’re watching portfolio managers trim around the edges while letting a handful of themes run. It would be unwise to assume the same narrative applies broadly, especially when the cash pile tells us that selectivity is not just a preference—it is mandatory.

Bitcoin futures analysis shows a bullish perspective above 103,920 and a bearish outlook below 103,450. Over the past 3.5 days, Bitcoin has been within a narrow range, indicating a short-term balance. The analysis employs tradeCompass methodology to assist traders in identifying key levels.

As of May 16, 2025, Bitcoin futures are in a four-day consolidation phase. The value area high (VAH) stands at 104,360, while the value area low (VAL) is at 103,550, with a volume-weighted average price (VWAP) from May 15 recorded at 103,920. The point of control (POC) is slightly below the VWAP, pointing out essential price points for Bitcoin today.

The 103,920 mark is pivotal for market sentiment; surpassing it leans towards bullishness, whereas falling below 103,450 indicates bearishness. The bullish range is from 103,920 to 103,950, and the bearish trigger falls below 103,450.

Bullish targets include 104,590, 105,000, and 106,165, with the aspiration of new all-time highs. Bearish aims are set at 103,185, 102,700, and reaching the significant 100,000 mark. Caution is advised in a high-inertia market, with traders urged to manage risks, especially over the weekend with CME Bitcoin futures.

TradeCompass offers decision support, providing thresholds based on volume profile and order flow data, highlighting the need for market understanding to enhance trade execution. Awareness of the 103,920 pivot zone remains vital and should be supported by sound trade management strategies.

Given the tight price activity and limited movement over recent days, what we’re seeing is a market that’s hesitating—one that’s pausing, but not yet deciding. When Bitcoin futures hover persistently inside a narrow band, oscillating without clear conviction, that usually means liquidity is being built up before a more forceful move takes hold, and those who act too soon often take on more risk than reward. The area between 103,920 and 103,450 becomes informative—not for how flat it seems, but for the weight it now carries.

What we’ve observed from Wednesday through Friday is a textbook compression. The fact that price rejected ventures above 104,360 or beneath 103,550 several times tells us that the market’s current perceived fair value is living somewhere between those two markers, with VWAP serving as a reference anchor right now. Arguably, that VWAP snapshot from May 15—103,920—isn’t just another number floating on a chart; it’s been acting as a dividing line for directional probability.

We use consolidation like this not to wait idly but to prepare. When movement is restricted and volume data tightens, the immediate course of action is risk alignment—tighten stops, scale entries, and note that aggressive trades without proper structure can be punished quickly, especially when futures roll or major exchanges are about to close for the weekend. Since our side of the table uses volume-profile-based distinctions, confidence comes from being on the right side of those zones, not trying to predict the next lurk or sweep.

Above 103,920, buyers have a clearer playbook. The projected levels at 104,590 through to just past 106,000 are not arbitrary—they’re calculated targets based on previous absorption zones and the absence of strong resistance once the initial ceiling is broken. Moves towards those areas can come rapidly, particularly if market makers pull resting offers into low liquidity gaps. That’s why sustained closes above 103,950—with support from expanding volume and controllable delta—are what we look out for.

Below 103,450, the market shifts footing. The region around 103,185 and 102,700 exposes earlier signposts of mispricing and failed support attempts. These are levels where weak longs tend to exit, and unhedged positions unravel. Should the price push into this corridor with velocity, the round figure of 100,000 acts as an emotional threshold—to not factor that into positioning would be negligent. Planning for such scenarios isn’t just prudent—it’s required.

Givens, such as the point of control now sitting marginally under VWAP, help define our execution bias. This shows that most traded volume hasn’t caught up to the current midpoint of activity, which, loosely translated, means rotational behaviour is still dominant. No single side has managed to overwhelm the auction so far, making fast, clean impulsive moves rare—until they are not.

In settings like this, we don’t aim for constant action. Rather, we take snapshots of volume distributions, monitor where large block orders cluster, and prepare for zones of imbalance to resolve. Because once either side takes initiative, moves could come brutally fast. When that happens, it’s not a time to understand–it’s a time to act with what you’ve already understood.

The price of Gold is experiencing pressure, with its value not enticing buyers despite recent drops. The reduction in tariffs between the USA and China has decreased Gold’s demand as a safe haven, previously heightened during earlier trade conflicts.

The premium associated with Gold’s safe-haven status is declining, and market participants have reduced expectations for US interest rate cuts. This change is due to reduced recession risks following the US-China trade agreement.

Gold Price Decline Analysis

The current analysis suggests a potential further decline in Gold prices. This is partly because buying interest has not increased following the recent price decreases, unlike in prior instances.

With the perceived urgency for defensive plays like Gold cooling off, we’re seeing investor behaviour shift towards assets with better immediate yield prospects. Essentially, with lower expectations for rapid US policy easing, the incentive to hold non-yielding assets like Gold fades. The safe-haven appeal is weakening in real time, and this will continue to reprice the metal lower unless external shocks reappear.

Powell’s recent remarks, paired with stable inflation data, have played a role here. There’s now more confidence that a steady course is being maintained, in contrast to the uncertainty that previously supported Gold. A notable part of this shift comes from how resilient the broader economic picture looks, especially employment and consumer demand figures.

Monitoring Implied Volatility Changes

As a result, options traders in particular may want to closely monitor changes in implied volatility. With lower tail risk being priced into macro conditions, and with the futures curve reflecting reduced anxiety, demand for defensive derivatives appears thin. Positioning that counted on aggressive Fed easing now looks vulnerable and will need adjustment if these macro signals persist.

Meanwhile across Asia, the unwind of trade war premiums, especially with improved relations between Beijing and Washington, has further removed a layer of geopolitical risk. This makes holding long Gold bets less palatable. For now, there’s little evidence of catch-up buying on dips, which historically acted as a floor. That absence is telling.

Technically, the failure to trigger any convincing rally after recent retracements suggests weakened underlying interest. We’re watching support zones that previously held firm begin to erode, and unless something shifts materially in the global picture, fresh longs are unlikely to lead the market higher.

In volatility markets, skew on metals is flattening, implying less demand for upside protection. We’ve also noted a reduction in open interest on longer-dated Gold contracts. This could reflect a lack of conviction in a near-term bounce and a preference among traders to deploy capital elsewhere, where both carry and trend favours risk exposure.

Equity flows, meanwhile, are showing a modest tilt back into cyclical and tech-heavy assets, suggesting positioning is being rebuilt selectively in risk-on sectors. This shift tends to coincide with a downtrend in safe-haven plays. Unless headline risk reappears—be it from the Middle East, central bank missteps, or sharp data surprises—the environment won’t be friendly for upside Gold bets.

For directional strategies, it may now be more appropriate to temper delta exposure, and consider shorter-dated instruments that account for subdued volatility. The scope for sharp recovery seems limited while rate expectations remain anchored, and with carry not favouring long commodities.

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US-China tariffs have been temporarily reduced, creating a rush for orders during a 90-day period. The situation replicates the post-lockdown surges from late 2020, where global supply chains faced increased strain as shipments rose sharply.

The Global Supply Chain Pressure Index reflects these pressures, with its impact expected to become evident in the latter half of the year. This remains uncertain due to ongoing US-China negotiations, which could extend beyond the initial 90 days.

Supply Chain Inflexibility

Supply chains are not as flexible as tariff policies, meaning changes in the latter do not instantaneously resolve supply chain issues. This week, ocean freight bookings from China to the US increased by 275% compared to last week, indicating potentially heightened pressures.

Concerns remain that the tariff easing might contribute to rising prices and inflationary pressures, similar to those seen in 2021 and 2022. Central banks previously termed such pressures as “transitory,” though the timeline remains unclear.

It is important to monitor data, such as the Global Supply Chain Pressure Index, to assess the material impact of current changes on supply chains and broader economic factors.

We’ve seen this before. When tariffs are cut, even temporarily, everyone rushes to place orders before the window closes. The current 90-day reprieve has echoed the frenzy observed just after restrictions lifted in late 2020. Then too, exporters raced against time, flooding ports with goods amid uncertainty over what would follow. And we all recall how that played out — backlogs, uneven pricing, shortages in some corners and overstocking in others. The chain didn’t snap, but it certainly buckled.

This week’s 275% rise in ocean freight bookings out of China isn’t just a statistical hiccup. It’s an early sign. When a single lane of trade reacts so suddenly, it often hints at broader shipment adjustments downstream. We should expect spot rates for containers to behave erratically — climbing sharply on stressed routes, spilling into short-term contracts and raising short-haul domestic logistics costs as warehouses fill out of order.

Powell and his colleagues tried to frame the last episode of supply-driven pricing pressure as temporary, but we spent months trying to assess where and when the inflation would flatten. While Fed language may now be more cautious, the market implications are quicker to surface, and far harder to ignore. When importers buy aggressively during a tariff lull, they often front-load inventories. If those orders collide with restocking cycles already underway, demand for freight jumps while available capacity stutters. That’s when price runs look less like recoveries and more like disruption.

Understanding The Implications

We shouldn’t rely solely on headline trade data — the Global Supply Chain Pressure Index gives a better reflection of tightness across logistics and manufacturing. Particularly in a setting where production schedules are shaped less by end-user demand and more by artificial policy windows, input costs and shipping premiums become difficult to predict.

The US–China negotiation process will almost certainly lean past the 90-day mark. But traders should work with what’s in place now, not what’s hoped for. Up until an agreement is formally confirmed, market participants will likely act as if the window won’t be extended — which, in practical terms, means consortium bookings, early fulfilment requests, and premium freight rates gaining ground over standard scheduling.

Yellen and her team’s stance on core inflation readings was always dependent on forward-looking metrics. In this context, weekly freight bookings, port congestion snapshots, and average lead times take on greater weight. Inflation isn’t just influenced by rates — it’s shaped by how efficiently goods can move. If that mobility is visibly strained, pricing pressure moves upstream quickly.

For those of us reading derivative signals from this kind of dislocation, the key isn’t in the tariff direction itself, but in mismatches between what suppliers can deliver and what importers demand. When those diverge too far, hedging activity intensifies — first in rates tied to shipping capacity, and then further along into energy costs and cross-currency movements.

Keep in mind: supply corrections don’t always follow demand. They lag. So while the initial response may look like strength — heightened bookings, upbeat order volumes — we should be cautious about how that strength plays out. Inventory glut in late quarters can suppress margins quickly.

We’ll continue watching short-term rates on containerised freight alongside regional warehouse capacity indexes. These give better leading clues than traditional inflation reports, which tend to smooth past the very bumps that can inform trade positioning.

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