The main intrigue of the April meeting is the ECB's and Christine Lagarde's reaction to the latest inflation data for the Eurozone. Preliminary data for April will be published just a few hours before the meeting, while we currently can only rely on the March figures, which reflect a rather contradictory picture.

Thus, overall inflation in the Eurozone jumped sharply last month, reaching 2.6%, after falling to 1.9% in February. This dynamic was primarily driven by energy, whose prices surged 5.1% year-on-year, following a 3.1% decline in February. Meanwhile, the core CPI index fell to 2.3%, down from 2.3%. This indicates that internal price pressure is indeed weakening. It is also worth noting the slowdown in inflation in the services sector, to 3.2% (from 3.4%). This is a very important point, as services are considered the most inertial component.

But this is just one side of the coin. On the other side are inflation risks that appear more threatening than the "comforting" March data. The main concern is the rise in inflation expectations. On Tuesday, results from a relevant survey were published, placing the ECB in a difficult position. Specifically, inflation expectations for the next year (the next 12 months) soared to 4.0% from a previous value of 2.5%. This is the highest value for the indicator since the end of 2023. Inflation expectations for three years rose to 3.0% (up from 2.5%), while perceived inflation increased to 3.5% (from 3.0%).

This is a troubling signal for the ECB: if consumers expect such a rapid price rise, they typically accelerate current spending (stimulating demand) and demand higher wages, which increases the risk of secondary inflation effects.

In response to the current situation, Lagarde will likely describe the survey results as "concerning" and will attempt to reassure consumers and markets that the ECB will not allow inflation to solidify at the 3-4% level. She could also use more hawkish phrasing, stating that if subsequent data confirms the risks of accelerating inflation, "the central bank will be ready to deploy all available tools."

Additionally, another signal indicates accelerating inflation in the Eurozone. On Wednesday, Germany released preliminary April CPI data. As we know, German and broader European inflation figures demonstrate a high correlation, so Wednesday's release "speaks volumes."

Thus, the overall annual consumer price index in Germany rose to 2.9% in April (up from 2.7% in the previous month), and the month-on-month increase was 0.6%. The harmonized HICP index also accelerated to 2.9% year-on-year (after rising 2.8% in March).

According to preliminary forecasts, the overall CPI in the Eurozone will accelerate to 3.1% year-on-year (up from 2.6%), while the core index will rise to 3.0% (up from 2.3%). Given Germany's inflation dynamics, such a forecast appears quite plausible.

Thus, following the April meeting, the ECB is likely to implement a "hawkish pause" scenario. By keeping interest rates unchanged, the ECB will emphasize the growing inflation risks. Lagarde is unlikely to announce any specific measures, but she may subtly signal readiness for a response.

However, despite this "preview," any price spikes in the EUR/USD pair should be considered as opportunities to open short positions. The market will quickly factor in the outcomes of the April meeting, after which geopolitical concerns will reemerge. The uncertainty surrounding the conclusion of the Middle Eastern conflict and ongoing geopolitical risks will support and continue to sustain demand for the safe-haven dollar. Therefore, under current conditions, the potential for further growth in EUR/USD appears limited—any upward impulses are likely to be corrective.

I suggest considering short positions on a pullback to the short breakdown. Limit risks to 4552. Take profit on a breakout at 4509.

This trading idea is presented within the framework of the "Price Action" method and "Hunting for Stops."

Wishing you success in trading, and remember to manage your risks

On Wednesday, it became known that Donald Trump has ordered preparations for a prolonged blockade of Iran. Let me remind you that the U.S. Navy has blocked the Strait of Hormuz and Iran's ports to prevent Tehran from exporting oil to the Far East. According to Trump, this is the path to total victory, which has already been announced ten times, and this action will force Iran to sign an agreement with the U.S. Naturally, such information did not come from the U.S. president or anyone from the White House administration. This is yet another "insider" report. The Wall Street Journal also stated that other scenarios (such as resuming bombings or withdrawing from the conflict) are not being considered by the American president.

Overall, everything is proceeding as I have been discussing in recent weeks. Since Washington has failed to secure any concessions from Iran regarding the "nuclear issue," Trump has limited options. Exiting the conflict would mean admitting defeat, as the primary objective of the military intervention has not been achieved. Resuming bombings of Iran would further diminish his political ratings, as the majority of Americans do not support war in Iran and react strongly to any personnel or equipment losses. Moreover, Americans are facing a new rise in consumer goods and fuel prices.

The blockade of Iran is a pathway to even more expensive energy resources. However, for Trump, this is not a problem, as the American government will not bear the costs of these expensive energy resources; American consumers will. In 2025, Trump collected dues from the American populace in the form of illegal trade tariffs, and in 2026, he will collect dues in the form of high-priced gasoline and gas. After all, America is fully energy-secure, and the cost of production has not changed. Consequently, the White House will export more oil and LNG to other countries at higher prices while selling fuel to American consumers at prices 1.5 times higher than just three months ago.

Therefore, for Trump, a long blockade of Iran is the best way out of the current situation and another means of filling the budget. At least for now, with six months remaining until the Congressional elections, during which Tehran may still make concessions. I do not believe this scenario will happen, but the White House leader will find a way out. It is impossible to predict what that will entail. One thing is for sure—it will not please anyone.

Wave Pattern for EUR/USD:

Based on the analysis of EUR/USD, I conclude that the instrument remains within an upward segment of the trend (bottom picture) and, in the short term, is within a corrective structure. The corrective wave set appears quite complete and may take on a more complex, extended form only if the geopolitical backdrop in the Middle East improves. Otherwise, from the current positions, a new downward wave set may begin to form. We have observed the corrective wave, and further developments will depend on market belief in a successful outcome of negotiations.

Wave Pattern for GBP/USD:

The wave pattern for GBP/USD has become clearer over time, as I had anticipated. We now see a clear three-wave upward structure on the charts, which may already be complete. If this is indeed the case, we can expect the formation of at least one downward wave (presumably d). The upward segment of the trend could take on a five-wave form, but for this to happen, the conflict in the Middle East must de-escalate rather than reignite. Therefore, the baseline scenario for the coming days is a decline towards the 34 figure or slightly lower. Again, everything will depend on geopolitical factors.

Key Principles of My Analysis:

1. Wave structures should be simple and clear. Complex structures are difficult to trade and often carry changes.
2. If there is no confidence in what is happening in the market, it is better not to enter.
3. There can never be 100% certainty about the direction of movement. Do not forget to use protective stop-loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.

Perhaps it is due to the divergence in monetary policies? The futures market does not anticipate any changes in the federal funds rate from the Federal Reserve in 2026, while the European Central Bank is eager to see deposit rate hikes in two Governing Council meetings, with some probability for a third. Nevertheless, the European Central Bank is in no rush until June. As Chief Economist Philip Lane aptly stated, despite a plethora of data, most officials have no idea what will happen in the Middle East and the global economy at the beginning of summer.

Dynamics of German Inflation

Markets constantly surprise. For example, consumer prices in Germany rose in April from 2.8% to 2.9%, although Bloomberg experts were expecting a jump to 3%. In contrast, Spanish CPI accelerated to 3.5%, although core inflation decreased to 2.8%.

Such dynamics in indicators and data on business activity and economic confidence demonstrate that stagflation—a combination of sluggish GDP growth and rising consumer prices—is approaching the Eurozone. The ECB must be extremely cautious when making important decisions. Investors understand this and are in no rush to buy the euro, especially since the European Commission asserts that the negative consequences of the conflict in the Middle East will be felt by the EU for a long time.

The situation is different in the United States, where GDP is poised to accelerate from 0.5% to 2.1% in the first quarter, and stock indices are breaking records amidst American exceptionalism. Under such conditions, the dollar should continue to rise. However, in reality, it is stuck in place. Perhaps investors have decided to wait for the FOMC meeting results in April. Alongside signals about future rates, they are also concerned about whether Powell will remain on the Open Market Committee.

This meeting of the Fed will be his last as chairman. He was appointed during Donald Trump's first presidential term and has faced considerable criticism from the White House. Mr. Always Late and America's Number One Enemy. Powell has held various titles. But he has done his job well. And he has preserved the Fed's independence. What will his successor—Kevin Warsh—be known for?

Technically, on the daily chart, EUR/USD is experiencing another assault on fair value at 1.169 by the "bears." If sellers of the main currency pair manage to consolidate below this mark, the risks of continued descent towards 1.164 and 1.156 will increase. Isn't this a reason to sell euros against the U.S. dollar?

The wave pattern on the 4-hour chart for EUR/USD has changed. There is still no talk of canceling the upward trend segment (lower chart), which began in January of last year, but the wave structure now looks rather ambiguous. In such situations, I always recommend switching to a lower timeframe (upper chart) and focusing on the simplest and smallest wave structures in order to make a short-term forecast, which is sufficient for opening trades. Wave structures can be very complex and allow for multiple scenarios. The easiest approach is to trade using the standard "five-three" pattern.

In the chart above, I can identify a classic five-wave impulse structure with an extended third wave. If this is indeed the case, then this structure has already been completed, and a corrective wave sequence of at least three waves is currently forming. We have already seen three waves, so in the near future the market will likely form at least one more corrective wave. How events unfold next depends on geopolitics: either a more complex correction develops, or a new downward trend segment begins.

The EUR/USD pair fell by 30 basis points during Wednesday, and volatility remained very low. The market still shows no desire to engage actively and prefers to wait calmly for events to unfold. Let me remind you that the next 24 hours will be extremely important in terms of the economic outlook for the Eurozone, the United States, and the United Kingdom. The central banks of these regions will hold their third meetings of the year. Although the market does not expect any changes in monetary policy, important information may come from the central bank leaders, who traditionally summarize the meetings. Market participants will need to closely monitor any changes in tone compared to previous statements, as these will determine the short-term dynamics of EUR/USD and GBP/USD.

At the same time, I would note that I still do not expect strong market movements or high trading activity. Of course, Jerome Powell or Christine Lagarde could hint at future rate hikes, and there are reasons for this: the Strait of Hormuz remains under a dual blockade, and Brent crude oil has returned to $120 per barrel and is likely to continue rising. Therefore, global inflation is expected to accelerate. Today, Germany released its April inflation report, and its figures allow for cautious optimism. Consumer prices rose by only 2.9% year-over-year—many had expected a much sharper increase. Nevertheless, inflation is rising and moving away from central banks' target levels. Therefore, rate hikes are likely only a matter of time.

General Conclusions

Based on this EUR/USD analysis, I conclude that the pair remains within an upward trend segment (lower chart), while in the short term it is within a corrective structure. The corrective wave pattern appears largely complete and may become more complex and extended only if the geopolitical situation in the Middle East improves. Otherwise, a new downward wave sequence may begin from current levels. We have already seen a corrective wave; what happens next will depend on market confidence in a successful outcome of negotiations.

On the lower timeframe, the entire upward trend segment is visible. The wave structure is not entirely standard, as corrective waves differ in size. For example, the higher-degree wave 2 is smaller than the internal wave 2 within wave 3. However, this does happen. I would remind you that it is best to identify clear structures on charts rather than strictly adhering to every single wave. Recent waves are difficult to interpret, so I rely more on higher timeframes in my analysis.

Key Principles of My Analysis:

1. Wave structures should be simple and clear. Complex structures are difficult to trade and often subject to change.
2. If there is no confidence in market conditions, it is better to stay out.
3. There is never 100% certainty about market direction. Always use protective Stop Loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.

There is little else to add regarding the news background or technical picture at this time. The situation around resolving the conflict in the Middle East remains stalled, and traders are uncertain whether any efforts are even being made to organize a new round of talks between Tehran and Washington. The technical picture is simple and clear: either wait for a bullish signal or for the bullish pattern to be invalidated.

The latest rally in the pound began with a "Three Drives Pattern." Thus, traders received a bullish signal at the very start of the move, and the trend remains bullish. At present, the ceasefire is quite fragile, and the parties involved have yet to decide whether to continue negotiations or resume hostilities. Talks may resume, but so could the conflict. The Strait of Hormuz remains under a dual blockade, and Tehran and Washington have not even agreed on a second round of negotiations, let alone a comprehensive agreement to end the conflict. As of Wednesday, nothing has changed for two weeks. Both sides verbally express willingness to reach a deal, but in practice, no real steps are being taken.

The "Three Drives Pattern," marked on the chart with a triangle, allowed bulls to go on the offensive. Imbalance 18 gave traders an opportunity to open long positions, and imbalance 19 may offer another chance. Thus, this week we may see a third bullish signal within the current impulse. Bearish patterns and liquidity grabs are not causing any concern for bulls.

The economic news background on Wednesday was absent, and no new reports regarding a ceasefire or negotiations came from the United States or Iran. Iran believes it has put the ball in the U.S.'s court, while the U.S. believes the opposite. The pause continues, albeit without active hostilities. Meanwhile, the market is waiting for the Fed meeting.

In the United States, the overall news background suggests that, in the long term, little can be expected other than a weakening dollar. Even the conflict between the U.S. and Iran does not significantly change this. Geopolitics briefly reminded markets of the dollar's safe-haven status for about two months, but overall, the long-term outlook for the U.S. dollar remains challenging. The U.S. labor market continues to weaken, the economy is approaching recession, and the Fed—unlike the ECB and the Bank of England—is not planning to tighten monetary policy in 2026. In addition, there have already been four major protests across the U.S. against Donald Trump, and the departure of Jerome Powell could further complicate matters for the dollar (especially if, under Kevin Warsh, the FOMC adopts a more dovish stance). From an economic perspective, I see no grounds for dollar strength.

News calendar for the U.S. and the United Kingdom:

• United Kingdom – Bank of England rate decision (11:00 UTC)
• United Kingdom – Bank of England monetary policy report (11:00 UTC)
• United Kingdom – MPC voting results on the rate (11:00 UTC)
• United States – Core PCE index (12:30 UTC)
• United States – Q1 GDP (12:30 UTC)
• United States – Personal income and spending (12:30 UTC)

On April 30, the economic calendar includes six entries, with traders needing to pay particular attention to the Bank of England meeting and U.S. GDP data. The impact of the news background on market sentiment on Thursday is expected to persist throughout the entire day.

GBP/USD Forecast and Trading Advice:

For the pound, the long-term outlook remains bullish. The "Three Drives Pattern" warned traders of potential growth, followed by the formation of a bullish imbalance and a bullish signal. Price swept liquidity from bullish swings on March 10 and 23, as well as from the February 26 swing, but bears failed to initiate an attack in either case. This is another positive sign for the pound—traders remain in a bullish mindset. Therefore, despite geopolitical factors, I believe the upward movement will continue. Most likely, the euro will also continue to rise. I see the 2026 high as the target for the pound. The reaction to imbalance 16 triggered a corrective pullback, but the reaction to imbalance 19 may provide traders with a new opportunity to open long positions.

In the current situation, traders can only wait for imbalance 13 to play out. There are no other clear buying zones at the moment, and I still consider the trend to be bullish. Thus, I am only interested in buy signals. There are no bearish patterns at present. The last buy signal from imbalance 12 worked perfectly, with the euro gaining about 270 points. Those trades could have been closed with solid profits. There have been no grounds for selling.

It is also worth noting that the entire rise of the U.S. dollar from January to March was driven solely by geopolitics. As soon as the United States and Iran agreed to a ceasefire, bears immediately retreated, and bulls launched an attack. At present, the truce remains fragile but intact. I have repeatedly stated that I do not believe in the end of the bullish trend, despite the break of important trend-forming lows. The price movement over the past two months could turn into a bearish trend if geopolitics continue to deteriorate. However, markets often price in the most pessimistic scenario in advance, attempting to anticipate the most extreme developments. Therefore, it is possible that traders have already fully priced in the geopolitical conflict in the Middle East. In that case, bears no longer have an advantage.

The overall technical picture is currently clear. First, price showed no reaction to imbalance 11. Second, price reacted to imbalance 12, forming a bullish signal within a bullish trend. Third, a new bullish imbalance 13 has formed, which serves as a zone of interest for future buy trades and as a support area for the euro.

The news background on Wednesday has started to attract traders' attention, but, for example, the initial German inflation report did not trigger any market movement. The Consumer Price Index rose to 2.9% year-over-year in April, which can be considered moderate growth given the global energy crisis. Many had expected much higher inflation dynamics. For now, the market continues to wait for the Fed meeting.

There are still many reasons for bulls to attack in 2026, and even the outbreak of war in the Middle East has not reduced them. Structurally and globally, Donald Trump's policies, which led to a significant weakening of the dollar last year, have not changed. In the coming months, the U.S. currency may occasionally strengthen due to risk aversion, but this factor requires ongoing escalation in the Middle East. I still do not believe in a bearish trend. The dollar has received temporary support, but what will drive bears in the long term?

News calendar for the U.S. and the Eurozone:

• Germany – Retail sales (06:00 UTC)
• Germany – Unemployment rate (07:55 UTC)
• Germany – GDP (Q1) (08:00 UTC)
• Eurozone – GDP (Q1) (09:00 UTC)
• Eurozone – Consumer Price Index (09:00 UTC)
• Eurozone – Unemployment rate (09:00 UTC)
• Eurozone – European Central Bank rate decision (12:15 UTC)
• U.S. – Core PCE index (12:30 UTC)
• U.S. – GDP (Q1) (12:30 UTC)
• U.S. – Personal income and spending (12:30 UTC)
• Eurozone – ECB press conference (12:45 UTC)
• Eurozone – Speech by Christine Lagarde (15:15 UTC)

On April 30, the economic calendar contains "only" twelve major entries. The impact of the news flow on market sentiment on Thursday could be very strong throughout the entire day.

EUR/USD Forecast and Trading Advice:

In my view, the pair remains in the process of forming a bullish trend. The news background shifted sharply two months ago, but the trend itself cannot be considered canceled or complete. Therefore, bulls may well continue their advance in the near term unless geopolitics suddenly shift toward renewed escalation.

Bulls had the opportunity to open buy trades based on the signal from imbalance 12, and the upward movement may continue toward this year's highs. A new imbalance 13 has also formed, which could generate another bullish signal in the near future. For uninterrupted euro growth, the Middle East conflict would need to move toward lasting peace, which is not currently the case. However, bears are not gaining additional reasons to attack either. In the near term, I would rely primarily on technical analysis, which currently points to bullish dominance.

Crude oil is trading around $97.68, rebounding after reaching the $97 level, which coincides with the lower band of the uptrend channel; a technical rebound above this level could occur in the coming hours.

If crude oil consolidates above $97 in the coming hours, this could be seen as a positive signal to buy, especially since the price remains within the uptrend channel. We could expect it to reach Murray's 8/8 level around $100 and potentially even reach the $102.25 zone near the daily R_2.

Conversely, if a decisive break and consolidation below $97 happens, the price could quickly reach the 21 SMA at $95 and even reach the 200 EMA around $90.34.

The H4 chart shows that crude oil remains within the bullish channel, so it is expected to continue rising in the coming days.

In case of a decisive break below the bearish trend channel, we could look for opportunities to open short positions, anticipating that it will reach the $83.25 zone in the short term, where the gap was left on April 17.

Our outlook for the coming hours is to buy above $97 or sell below $102.11, waiting for a bullish scenario to develop before opening short positions, as the market is technically overbought.

Gold is trading around $4,561, hitting Tuesday's low and consolidating above that level, showing a negative signal while also reaching oversold levels.

Gold failed to break through the $4,600 barrier and underwent a technical correction toward $4,550. Given that this support level is holding, if it were to break in the coming hours, the price could continue falling until it reaches the lower band of the downtrend channel, located at $4,510–$4,491.

Conversely, if the price consolidates above $4,500, we could expect a technical rebound toward the 21 SMA at $4,652 or toward the upper band of the downtrend channel formed since April 16, around $4,645.

A decisive breakout and consolidation above $4,652 would change the outlook for gold, and we could expect a sustained recovery. If this scenario plays out, gold could reach the 200 EMA around $4,754 in the coming days and might even return toward $5,000 around the 8/8 Murray line.

Alternatively, according to the H4 chart, gold has reached oversold levels, so we could expect a technical rebound in the coming hours if the price consolidates above $4,550 or if it reaches the next support level around $4,500; both levels could present an opportunity to open long positions.

Bitcoin is trading around $77,391, rebounding after finding strong support at the lower band of the uptrend channel. The chart shows signs of exhaustion in the bullish momentum, as the strong 5/8 Murray line is keeping Bitcoin under downward pressure.

If Bitcoin consolidates below the 21 SMA at $77,363 in the coming hours, this could be seen as a signal to open short positions with targets at the 4/8 Murray line around $75,000.

The $78,125 zone has been putting pressure on Bitcoin since April 17. On previous occasions, we have seen a strong rejection. Given this, we could technically view this as a negative signal to sell Bitcoin, with short-term targets around the 3/8 Murray line at $71,875.

Conversely, a decisive break and consolidation above the downtrend channel formed since April 26 could revive the bullish cycle, and Bitcoin could rebound to the psychological level of $80,000 and even hit the 6/8 Murray level around $81,250.

The Eagle indicator is showing bearish signals, so our bearish strategy will remain in place as long as the instrument trades below $78,125.

The ETH/USD pair is trading around $2,322 within a downtrend channel that has been forming since April 15 and is showing signs of exhaustion after rebounding above $2,254.

ETH could continue its fall in the coming hours until it reaches the 200 EMA. It could even reach the 2/8 Murray line around $2,187.

Given that Ethereum is currently within this range, a breakout toward the 3/8 Murray line at $2,343 or toward the upper band of the uptrend channel around $2,365 could be considered an opportunity to open short positions with targets at $2,187.

The strong resistance at $2,500, located around the 4/8 Murray line, keeps Ethereum under bearish pressure. On April 17, the cryptocurrency attempted to reach this zone but was unsuccessful. On several occasions, the price has managed to rise but has been unable to enter this zone.

According to the technical chart, the Japanese candlesticks indicate a consolidation of ETH and a possible technical reversal in the coming days. Ehtereum is expected to reach the 1/8 Murray line around $2,031, or could reach the psychological level of $2,000.

The probability of an RBA rate hike at the upcoming meeting on 5 May has fallen from 80% to 70%, meaning the market still expects a hike, but with less confidence. The inflation report was compiled before fuel excises were cut — one of the government's measures to curb price growth — and, as it turned out, that measure had no impact on diesel, where shortages are intensifying: the average price in March was 2.99 AUD per liter, versus 2.63 AUD in February. At the March meeting the RBA raised the cash rate to 4.1%, and it is clear that inflation will continue to rise, so the RBA will likely have to tighten again. However, the risk that further tightening could trigger a domestic economic crisis, compounding the energy shock with tighter financial conditions, may force the RBA to pause.

The situation remains highly uncertain. In Q4 last year Australia's GDP grew by 2.6% year on year, the fastest pace in two years. Things appeared to be on track, and inflation seemed contained, but the war in the Middle East changed everything. The US and Iran are far from a peace deal; Iran's Supreme Leader Khamenei refused to resume talks, citing US "arrogance," and President Trump, in turn, instructed aides to prepare for an extension of the blockade of the Strait of Hormuz. It appears the strait is being contested by both sides, which reduces the likelihood of a near-term resumption of traffic each day. Most likely, the brief period of rising risk appetite is ending, and the world must prepare for a deeper and more prolonged crisis. This outlook is particularly serious for Australia, given its heavy reliance on external fuel supplies.

Speculative positioning in AUD was unchanged over the reporting week, with a bullish net exposure of 4.8 billion, but the implied price, pressured by short-term factors, is moving progressively below the long-term average.

A week ago, we assumed AUD/USD would continue to trade in a sideways range, because the likelihood that the RBA would pause at the next meeting was high. Over the past week additional factors have emerged that increase the odds of a southward move. We expect that even the inflation rise will recede into the background in the face of the risk of a sharp economic slowdown and that AUD/USD will turn down toward 0.6915–0.6945.

There is a rational core to this, despite the proposal seeming paradoxical at first glance, and it lies in basic asset-management principles. Central banks, tasked with ensuring financial stability, have traditionally followed conservative strategies. However, as the CNB governor rightly noted, looking to the future and adapting to a changing landscape is equally important. Analysis conducted by the Czech central bank showed that even a small allocation to Bitcoin —1% of a portfolio— can, statistically, improve returns while maintaining a normal risk profile.

A key factor behind this effect is Bitcoin's low correlation with traditional financial assets, such as equities, bonds, or gold. In periods of market uncertainty, when traditional markets decline, Bitcoin has demonstrated the potential to behave differently, thereby enhancing overall portfolio diversification and, over time, reducing portfolio volatility. This characteristic makes it an attractive tool for hedging and optimization.

Of course, Bitcoin's risks cannot be ignored, including high volatility and the possibility of large price swings, up to total loss of value. However, as the CNB governor observed, similar risks exist for other, more traditional assets. The risk-management strategy here is not to avoid innovation, but to allocate capital wisely and diversify.

The Czech central bank's decision to launch a two-year pilot portfolio including Bitcoin underscores a pragmatic approach. This will allow a practical assessment of the claimed benefits, and reveal potential risks under real market conditions.

Trading recommendations:

Regarding Bitcoin's technical picture, buyers are currently targeting a return to $77,700, which opens a direct route to $79,100, and from there to $80,900. The most distant target is the high near $83,100, breaching which would signal attempts to return to a bullish market. In case of a decline, I expect buyers at $76,300. A drop below that area could quickly push BTC toward $75,000. The furthest target there would be around $73,100.

Regarding Ethereum's technical picture, a clear consolidation above $2,353 opens a direct route to $2,394. The most distant target is the high near $2,459, breaching which would indicate strengthening bullish sentiment and a return of buyer interest. In case of a decline, I expect buyers at $2,301. A return of the instrument below that area could quickly send ETH toward $2,245. The furthest target there would be around $2,162.

What we see on the chart:

- Red lines indicate support and resistance levels where either a price slowdown or active growth is expected;

- Green lines indicate the 50-day moving average;

- Blue lines indicate the 100-day moving average;

- Light green lines indicate the 200-day moving average.

A crossover, or a price test of moving averages, typically either halts the move or sparks fresh market momentum.

Useful links:

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Important:

The begginers in forex trading need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp market fluctuations due to increased volatility. If you decide to trade during the news release, then always place stop orders to minimize losses.

Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes. For successful trading, you need to have a clear trading plan and stay focues and disciplined. Spontaneous trading decision based on the current market situation is an inherently losing strategy for a scalper or daytrader.

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The test of the 159.66 level occurred when the MACD indicator had just begun moving downward from the zero line, confirming a valid entry point for selling the dollar. However, the pair did not proceed with any decline.

Today, all attention will be focused on U.S. data and the Federal Reserve's decision. It is expected that the monetary policy authority will keep the interest rate unchanged at 3.75% for the third consecutive time this year. Such stability, if confirmed, will demonstrate the current resilience of the economic system and signal the Fed's intention to wait for clearer changes in inflation and the labor market following the start of the U.S. conflict with Iran in February of this year.

The final highlight will be the last press conference of Fed Chair Jerome Powell, who will step down on May 15. Market participants will look closely at his remarks for clues about the future course of monetary policy, trying to detect signals about how long current rates will be maintained and what factors might lead to their adjustment.

As for the intraday strategy, I will rely more on implementing scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: I plan to buy USD/JPY today when the price reaches the entry point around 159.90 (green line on the chart), targeting a rise to 160.39 (thicker green line on the chart). Around 160.39, I will exit long positions and open short positions in the opposite direction (aiming for a 30–35 point move). Growth in the pair today can be expected if the Fed adopts a hawkish stance.Important: Before buying, make sure the MACD indicator is above the zero line and just beginning to rise.

Scenario No. 2: I also plan to buy USD/JPY if there are two consecutive tests of the 159.69 level while the MACD indicator is in the oversold zone. This will limit the pair's downward potential and lead to an upward reversal. A rise toward the opposite levels of 159.90 and 160.39 can be expected.

Sell Signal

Scenario No. 1: I plan to sell USD/JPY after a break below the 159.69 level (red line on the chart), which would lead to a rapid decline in the pair. The key target for sellers will be 159.07, where I plan to exit short positions and also open long positions in the opposite direction (aiming for a 20–25 point move). Pressure on the pair will return today if the Fed takes a dovish stance.Important: Before selling, make sure the MACD indicator is below the zero line and just beginning to decline.

Scenario No. 2: I also plan to sell USD/JPY if there are two consecutive tests of the 159.90 level while the MACD indicator is in the overbought zone. This will limit the pair's upward potential and lead to a downward reversal. A decline toward the opposite levels of 159.69 and 159.07 can be expected.

Chart Explanation

• Thin green line – entry price for buying the trading instrument;
• Thick green line – estimated level for setting Take Profit or locking in profits, as further growth above this level is unlikely;
• Thin red line – entry price for selling the trading instrument;
• Thick red line – estimated level for setting Take Profit or locking in profits, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to consider overbought and oversold zones.

Important Note for Beginner Traders

Beginner Forex traders should make market entry decisions very carefully. Before the release of important fundamental reports, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always place stop-loss orders to minimize losses. Without stop-losses, you can quickly lose your entire deposit, especially if you do not use proper money management and trade large volumes.

Remember, successful trading requires a clear trading plan, like the one outlined above. Spontaneous trading decisions based on current market conditions are inherently a losing strategy for an intraday trader.

There were no tests of the levels I outlined during the first half of the day. Low market volatility amid a lack of data releases did its job.

In the coming hours, attention will be focused on the release of several important economic indicators from the United States. The sequence will begin with data on changes in durable goods orders. This indicator is sensitive to the state of industrial production and investment activity, so its dynamics can provide insight into the strength of the current economic cycle. It will be followed by a report on building permits, which signals future activity in the construction sector—one of the pillars of the U.S. economy.

However, despite the importance of these data releases, the main event of the day will undoubtedly be the Federal Open Market Committee's decision on the key interest rate. The regulator is expected to keep the rate unchanged at 3.75%. If confirmed, this stability will highlight the current balance in the economy and signal the Fed's intention to monitor further inflation developments before making any adjustments. The culmination will be the subsequent press conference, where Fed Chair Jerome Powell will present his assessment of economic prospects and explain the reasoning behind the decision.

As for the intraday strategy, I will rely more on implementing scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: I plan to buy the pound today when the price reaches the entry point around 1.3515 (green line on the chart), targeting a rise to 1.3571 (thicker green line on the chart). Around 1.3571, I will exit long positions and open short positions in the opposite direction (aiming for a 30–35 point move). Further growth in the pound today can only be expected if the Fed adopts a dovish stance.Important: Before buying, make sure the MACD indicator is above the zero line and just beginning to rise.

Scenario No. 2: I also plan to buy the pound if there are two consecutive tests of the 1.3493 level while the MACD indicator is in the oversold zone. This will limit the pair's downward potential and lead to an upward reversal. A rise toward the opposite levels of 1.3515 and 1.3571 can be expected.

Sell Signal

Scenario No. 1: I plan to sell the pound after a break below the 1.3493 level (red line on the chart), which would lead to a rapid decline in the pair. The key target for sellers will be 1.3436, where I plan to exit short positions and also open long positions in the opposite direction (aiming for a 20–25 point move). Pressure on the pound will return today if the Fed takes a hawkish stance.Important: Before selling, make sure the MACD indicator is below the zero line and just beginning to decline.

Scenario No. 2: I also plan to sell the pound if there are two consecutive tests of the 1.3515 level while the MACD indicator is in the overbought zone. This will limit the pair's upward potential and lead to a downward reversal. A decline toward the opposite levels of 1.3493 and 1.3436 can be expected.

Chart Explanation

• Thin green line – entry price for buying the trading instrument;
• Thick green line – estimated level for setting Take Profit or locking in profits, as further growth above this level is unlikely;
• Thin red line – entry price for selling the trading instrument;
• Thick red line – estimated level for setting Take Profit or locking in profits, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to consider overbought and oversold zones.

Important Note for Beginner Traders

Beginner Forex traders should make market entry decisions very carefully. Before the release of important fundamental reports, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always place stop-loss orders to minimize losses. Without stop-losses, you can quickly lose your entire deposit, especially if you do not use proper money management and trade large volumes.

Remember, successful trading requires a clear trading plan, like the one outlined above. Spontaneous trading decisions based on current market conditions are inherently a losing strategy for an intraday trader.

The test of the 1.1707 level occurred at a moment when the MACD indicator had just begun moving upward from the zero line, confirming a valid entry point for buying the euro. However, the pair did not proceed with any upward movement.

The release of Eurozone lending data and M3 money supply figures did not trigger any noticeable positive reaction in the euro during the first half of the day. During this time, the EUR/USD pair remained within a narrow trading range, showing weak activity and low liquidity, which is typical ahead of important fundamental data releases.

Today's decision by the U.S. Federal Open Market Committee on the key interest rate will attract all attention. This highly anticipated verdict could become a defining moment, setting the direction for financial markets in the near future. Traders and economists expect rates to remain unchanged. Particular importance is attached to the upcoming press conference, where Fed Chair Jerome Powell will speak for the last time in his current role. His final remarks in such a high position will carry weight, shaping expectations regarding the trajectory of interest rates and other monetary policy tools. Any deviation from general forecasts could trigger sharp price movements, so market direction will depend on nuances in wording, tone, and answers to journalists' questions.

As for the intraday strategy, I will rely more on implementing scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: Today, you can buy the euro when the price reaches the 1.1710 level (green line on the chart), with a target of rising to 1.1750. At 1.1750, I plan to exit the market and also consider selling in the opposite direction, aiming for a 30–35 point move from the entry level. Growth in the euro today can only be expected if the Fed takes a dovish stance.Important: Before buying, make sure that the MACD indicator is above the zero line and just beginning to rise.

Scenario No. 2: I also plan to buy the euro if there are two consecutive tests of the 1.1693 level while the MACD indicator is in the oversold zone. This would limit the pair's downward potential and lead to an upward reversal. A rise toward the opposite levels of 1.1710 and 1.1750 can be expected.

Sell Signal

Scenario No. 1: I plan to sell the euro after it reaches the 1.1693 level (red line on the chart). The target will be 1.1652, where I intend to exit the market and immediately buy in the opposite direction (aiming for a 20–25 point move). Pressure on the pair will return today if the Fed adopts a hawkish stance.Important: Before selling, make sure that the MACD indicator is below the zero line and just beginning to decline.

Scenario No. 2: I also plan to sell the euro if there are two consecutive tests of the 1.1710 level while the MACD indicator is in the overbought zone. This would limit the pair's upward potential and lead to a downward reversal. A decline toward the opposite levels of 1.1693 and 1.1652 can be expected.

Chart Explanation

• Thin green line – entry price for buying the trading instrument;
• Thick green line – estimated level for setting Take Profit or locking in profits, as further growth above this level is unlikely;
• Thin red line – entry price for selling the trading instrument;
• Thick red line – estimated level for setting Take Profit or locking in profits, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to consider overbought and oversold zones.

Important Note for Beginner Traders

Beginner Forex traders should make market entry decisions very carefully. Before the release of important fundamental reports, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always set stop-loss orders to minimize losses. Without stop-losses, you can quickly lose your entire deposit, especially if you do not use proper money management and trade with large volumes.

Remember, successful trading requires a clear trading plan, like the one outlined above. Spontaneous trading decisions based on the current market situation are inherently a losing strategy for an intraday trader.

The UAE are set to leave OPEC on May 1, a move that would be a major blow to the oil producing cartel. Meanwhile, the US is stepping up pressure on Iran, targeting Chinese refineries and countries that pay transit fees.

West Texas Intermediate (WTI) crude has again broken the psychological $100/bbl level amid fundamental drivers.

Reports that the US is prepared to extend its blockade of Iran are exacerbating supply problems in the Middle East. According to a Wall Street Journal report published Wednesday, US officials say President Donald Trump has instructed aides to prepare for a prolonged blockade of Iran. The report says Trump has decided to continue pressure on Iran's economy and oil exports by restricting shipping to and from Iranian ports. Sources added that he sees alternatives — such as renewed bombing or broader military intervention — as riskier than maintaining the blockade.

In addition, the United Arab Emirates are set to leave the Organization of the Petroleum Exporting Countries (OPEC) on May 1, a significant blow to the group, Reuters reported Tuesday, against a backdrop of a deepening energy crisis caused by the Iran conflict and growing rifts among Gulf states.

President Trump has also said Iran asked Washington to lift the naval blockade of the Strait of Hormuz while ceasefire negotiations continue, as energy shipments from the region are already being disrupted. Closing this vital sea corridor has halted roughly 20% of global oil shipments.

The US has further stepped up pressure on Iran by taking additional measures, including the possible imposition of sanctions on Chinese refineries with ties to Tehran and on countries that pay transit fees for passage through the Strait of Hormuz.

From a technical standpoint, oil is trading above the main moving averages, with momentum pushing beyond the psychological $100.00 mark, confirming the likelihood of further upside. Oscillators are positive and remain well away from overbought territory, indicating bullish strength in the market.

From January to March, central bank demand for bullion increased modestly by 3%. Countries such as Poland, Uzbekistan, and China were net buyers, while Azerbaijan and Russia reported sales. Capital flows into ETFs were mixed: March saw outflows, but the first quarter overall recorded a modest gain.

Oil and gold performance

Gold continues to be pressured by the ongoing conflict in the Middle East. The issue is not solely the strength of the US dollar as a safe-haven asset, but it is also linked to rising oil prices, accelerating inflation, and central banks' intentions to tighten monetary policy. This scenario leads to higher Treasury yields. Since gold does not pay interest, it struggles to compete with Treasuries when rates are on the rise.

The outlook for XAU/USD is growing gloomy, with the World Bank forecasting an average gold price of $4,700 per ounce in 2026, followed by a further decline of 7% in 2027. However, opinions vary widely. Goldman Sachs, for example, forecasts a return of the precious metal to $5,400 by the end of the year, driven by two rounds of monetary expansion from the Fed and increased central bank demand for bullion. Meanwhile, Amundi projects prices rising to $5,500 within 12 months, arguing that the acceleration in inflation will be temporary, allowing the Fed to consider easing monetary policy.

Thus, in the medium to long term, gold may still have a fighting chance. For now, it remains under pressure due to expectations of hawkish rhetoric from Jerome Powell during the press conference following the April FOMC meeting. If investors hear that the Fed is abandoning rate cuts, the US dollar is likely to strengthen, Treasury yields will rise, and XAU/USD may decline.

Additionally, Powell's intention to remain a member of the FOMC until 2028 could work against the precious metal. In this scenario, Donald Trump's ambitious plans to fill the Federal Open Market Committee with "doves" may not materialize. Kevin Warsh's dreams of reshaping the Fed may also need to be postponed.

From a technical perspective, the daily gold chart indicates a divergence from moving averages and fair value, suggesting a strengthening of bearish positions. A drop below $4,550 or a rebound from $4,640 per ounce could trigger sell signals.

Data on lending in the Eurozone and the M3 money supply had no impact on the euro's exchange rate. The pound also remained ignored by traders amid a lack of any significant statistics. The market appears to be in a state of relative expectation (wait-and-see mode), focusing exclusively on upcoming statements from Federal Reserve officials. The second half of the day is expected to be more active, as attention will be centered on the Federal Open Market Committee's decision regarding the key interest rate.

Particular importance is attached to the upcoming press conference, during which Fed Chair Jerome Powell will speak for the last time in his current role. His comments, analyzed under a microscope, will not only clarify the decision taken but may also hint at the regulator's future steps. His final remarks in such a responsible position will carry weight, shaping medium-term expectations regarding the trajectory of interest rates and other monetary policy tools. Any deviation from consensus expectations could trigger sharp market movements, creating both opportunities for profitable speculation and risks for unwary investors.

Data on U.S. durable goods orders and building permits are also expected. However, all attention will clearly be on the Fed's decision.

In the case of strong data, I will rely on the Momentum strategy. If the market does not react to the data, I will continue using the Mean Reversion strategy.

Momentum Strategy (breakout) for the second half of the day

For EUR/USD:

• Buying on a breakout above 1.1705 may lead to euro growth toward 1.1727 and 1.1753;
• Selling on a breakout below 1.1685 may lead to a decline toward 1.1670 and 1.1645;

For GBP/USD:

• Buying on a breakout above 1.3515 may lead to pound growth toward 1.3540 and 1.3575;
• Selling on a breakout below 1.3490 may lead to a decline toward 1.3465 and 1.3440;

For USD/JPY:

• Buying on a breakout above 159.85 may lead to dollar growth toward 160.10 and 160.30;
• Selling on a breakout below 159.70 may lead to selling toward 159.40 and 158.99;

Mean Reversion Strategy (pullback) for the second half of the day

For EUR/USD:

• I will look for selling opportunities after a false breakout above 1.1711 followed by a return below this level;
• I will look for buying opportunities after a false breakout below 1.1692 followed by a return to this level;

For GBP/USD:

• I will look for selling opportunities after a false breakout above 1.3513 followed by a return below this level;
• I will look for buying opportunities after a false breakout below 1.3488 followed by a return to this level;

For AUD/USD:

• I will look for selling opportunities after a false breakout above 0.7170 followed by a return below this level;
• I will look for buying opportunities after a false breakout below 0.7145 followed by a return to this level;

For USD/CAD:

• I will look for selling opportunities after a false breakout above 1.3696 followed by a return below this level;
• I will look for buying opportunities after a false breakout below 1.3673 followed by a return to this level.

Today, Wednesday, gold (XAU/USD) continues to face selling pressure for the third day in a row. Ongoing uncertainty regarding the second stage of peace negotiations between the United States and Iran is supporting the U.S. dollar's status as the key reserve currency and weighing on this asset's prices. Expectations for a diplomatic resolution weakened after the weekend, when U.S. President Donald Trump canceled his special envoy's visit to Pakistan. Additionally, according to media reports, Trump expressed dissatisfaction with Iran's updated proposal to end the conflict and restore shipping through the Strait of Hormuz, while discussions on the nuclear program were postponed.At the same time, shipping volumes through this strategically important route have dropped significantly amid restrictions imposed by Iran, as well as the U.S. naval blockade of Iranian ports. Combined with the prolonged deadlock between the countries, this supports high oil prices and increases inflationary risks. Such dynamics could force leading central banks, including the Federal Reserve, to maintain a tighter monetary policy, which in turn reduces the attractiveness of gold as a non-yielding asset.Nevertheless, market participants expecting a decline in the precious metal should refrain from aggressive action and adopt a wait-and-see approach ahead of the FOMC decision, expected later during the U.S. session. The key focus should be on the subsequent press conference, where comments from Federal Reserve Chair Jerome Powell should be carefully analyzed for signals about the future direction of monetary policy. Expectations regarding the regulator's next steps could significantly influence short-term movements in the U.S. dollar and, accordingly, set the direction for gold prices.

At the same time, the current fundamental backdrop points to a continuation of the downward trend for the XAU/USD pair, increasing the likelihood of further price declines. In this regard, any attempts at corrective growth may be seen as opportunities to open short positions and are likely to be limited in duration.

From a technical perspective, XAU/USD failed to hold the round level of 4600, finding support at 4550 on its way toward the round level of 4500. Oscillators are negative, indicating weakness among bulls and suggesting that the path of least resistance remains to the downside.

From a technical perspective, gold found support at $4,552.75. If this level holds, a local rise in the yellow metal can be expected.

Technical picture and trading idea:

• Price is below the middle line of the Bollinger Bands, and below the SMA 5 and SMA 14.
• RSI is moving flat in the oversold area.
• Stochastics are rising.

Gold may locally reverse upward toward $4,711.15. A buy entry could be at $4,616.10.

Bitcoin has shown resilience, rallying roughly 20% from February lows. That rally was fueled by several key drivers, notably spot ETFs that attracted about $3.8 billion. Activity from "whales" — long?term holders who traditionally act as a stabilizing force — also resumed.

However, as is often the case in the volatile crypto market, one company proved to be the strongest catalyst: Strategy. Over the past eight weeks, the firm bought a hefty $7.2 billion worth of Bitcoin, which clearly pushed prices higher. Large institutional purchases like this often act as catalysts for broader market sentiment.

Recent trends, though, point to a slowdown in capital inflows to spot ETFs, which may indicate cooling interest or saturation of existing investment flows. Going forward, market behavior will be even more dependent on activity from a relatively small number of large players.

A key issue to watch is the apparent exhaustion of Strategy's funding sourced from its issuance of perpetual preferred shares (STRC). Once that liquidity source runs dry, and if no new large buyers emerge, market pressure is likely to increase. The absence of such sizable inflows could trigger a price correction as demand sustained by large purchases weakens.

So, while the current dynamics are encouraging, bitcoin's further movement will largely depend on new institutional interest and the market's ability to attract fresh capital. ETF inflows and whale activity will remain important indicators, but long-term demand sustainability will determine the medium-term price trajectory.

Trading recommendations

Bitcoin

Buyers are currently targeting a return to $77,700, which opens a direct path to $79,100 and then $80,900. The fartherst target is the high near $83,100; breaking that would signal attempts to resume a bull market. In case of a decline, buyers are expected at $76,300. A drop below that area could quickly push BTC toward $75,000, with the far downside target around $73,100.

Ethereum

A clear hold above $2,394 opens a direct path to $2,459. The far target is the high near $2,575; breaking that would indicate strengthening bullish sentiment and a new wave of buying activity. In case of a decline, buyers are expected at $2,314. A fall below that area could quickly push ETH toward $2,245, with the far downside target around $2,162.

What's on the chart

• The red lines represent support and resistance levels, where the price is expected to either pause or react sharply.
• The green line shows the 50-day moving average.
• The blue line is the 100-day moving average.
• The lime line is the 200-day moving average.

Price testing or crossing any of these moving averages often either halts movement or injects fresh momentum into the market.

The sharp rise in energy prices and supply chain disruptions caused by the war with Iran have increased the likelihood of higher inflation and slower growth, prompting policymakers to signal a willingness to wait. However, recent US inflation data were not as bad as many had feared. At the same time, the Federal Open Market Committee is expected to keep its key policy rate in the 3.5%–3.75% range for a third consecutive meeting.

This cautious central bank's stance reflects a complex economic picture in which inflationary pressure remains but is not at a level requiring emergency action. Moderating consumer inflation growth offers hope for stabilization, yet geopolitical instability and its impact on energy markets remain sources of uncertainty.

Investors will scrutinize every Fed move in an attempt to predict the next steps. Holding the rate steady may be read as a signal that the regulator does not want to risk prematurely stimulating—or, conversely, restraining—the economy. That creates a period of waiting, during which the market will reassess the balance between inflation risks and the need to support growth.

At the press conference, which is likely to be Jerome Powell's last as Federal Reserve chair, investors will search for clues about how long the Fed intends to maintain its wait?and?see approach. More intriguingly, they will listen for what Powell says about his own future at the central bank. The current chair has suggested he might remain a member of the Board of Governors after his chairmanship ends on May 15.

A press conference by Powell will follow the publication of the meeting statement.

Powell will almost certainly be asked how recent political events could affect his decision to stay or leave the Fed. That refers to criminal proceedings by the US Department of Justice. The recent decision by US District Attorney Jeanine Pirro to drop the criminal investigation into the Federal Reserve potentially clears the way for President Donald Trump's nominee, Kevin Warsh, to become Fed chair. However, that does not guarantee the current chair's resignation. Many market participants are watching this closely, given the intense pressure President Trump is applying to the Fed to cut rates sharply.

Unanimity within the Fed also seems unlikely. Fed governor Steven Miran may voice dissent from the majority's decision, as he has at every meeting since joining the Fed in September last year.

EUR/USD technical picture

Buyers now need to take 1.1720. Only that would allow a target of 1.1752. From there, the currency pair can reach 1.1791, but doing so without support from large players will be difficult. The far target is 1.1822. On a drop, I expect meaningful buyer activity only around 1.1690. If there are no buyers there, it would be better to wait for a new low at 1.1670 or to open long positions from 1.1640.

GBP/USD technical picture

Pound buyers need to take the nearest resistance at 1.3520. Only that would allow a move to 1.3550, above which a breakout will be difficult. The far target is around 1.3585. On a fall, bears will try to seize control of 1.3490. If they succeed, a break of the range would deal a serious blow to bulls and push GBP/USD to 1.3470 with a prospect of moving toward 1.3445.

The broad index has gained roughly 18% since the start of April and is set for its best monthly performance since 2002. Much of the credit goes to impressive corporate results from US companies, above all those in the technology sector.

Monthly S&P 500 performance

Wall Street analysts estimate that EPS for the Big Tech group will jump by nearly 41% in the first quarter, roughly twice the expected gain for the second-ranked materials sector.

It is no surprise that the S&P 500 has effectively looked past the Middle East conflict and is focused on one thing — AI's ability to deliver exceptional financial results.

Expected EPS dynamics by S&P 500 sector

However, as soon as something goes wrong, the broad index faces a sell-off. The pullback was triggered by a Wall Street Journal report that ChatGPT maker OpenAI missed revenue and user growth forecasts. That news immediately knocked related stocks, including Oracle, CoreWeave, SoftBank, and others, as those firms had provided financing to OpenAI. Problems at the ChatGPT provider reminded investors of prior troubles and prompted selling across the S&P 500.

Goldman Sachs says a pullback in the broad index is due. That view reflects both overextended bullish positioning and a shift by key institutional investors from buyers to sellers. Systematic funds, which injected roughly $53 billion into the S&P 500 in April, stopped buying at the end of the month. Still, Goldman remains constructive on US equities and argues that any correction would present an excellent opportunity to build long exposure.

Bad news from OpenAI was a warning shot ahead of earnings from the four companies in the Magnificent Eight. If they disappoint, the pullback could deepen. Investors are also wary of potential hawkish signals from the Fed after the April FOMC meeting.

Technically, the S&P 500 tested fair value at 7,120 on the daily chart. The support level held, and bulls can return to buying in case of a move above 7,165. Conversely, a drop below 7,110 would be a trigger for selling.