For most of the week, markets continued their recent trends. Equities and the U.S. dollar moved higher, while oil traded mostly sideways as traders watched developments around Iran. Bitcoin was the most volatile market and remained under pressure as investors looked for better returns elsewhere.
Friday’s U.S. employment data was almost double expectations, and previous months were also revised higher. This strong data, together with ongoing inflation concerns, made markets focus on the possibility that the Fed may need to raise rates again. USD/JPY rose above 160 as the Bank of Japan did not intervene, and the U.S. dollar strengthened against other major currencies.
Gold came under pressure, while equities sold off sharply. The Nasdaq fell more than 4%, and the S&P 500 had its worst day of the year. Other data during the week also pointed to continued strength in the U.S. economy and ongoing inflation pressure, while Bank of Japan Governor Kazuo Ueda’s comments increased expectations of a possible June rate hike.
Markets This Week
U.S. Stocks
The Dow did not fall as much as the Nasdaq or S&P 500, but the weekly close below the 10-day moving average suggests selling pressure could continue this week. U.S. inflation data will be important for both the short-term and medium-term direction. For now, looking for selling opportunities may be the better approach as markets adjust to higher U.S. interest rate expectations. Resistance levels are at 51,500 and 52,000. Support is seen at 50,000, 49,500, 49,000, 48,500 and 48,000.
Japanese Stocks
The Nikkei 225 hit a record high during the week, but Japanese equities fell sharply on Friday night along with U.S. stocks. In the short term, the market may be oversold, and demand for Japanese equities remains strong. However, the medium-term outlook looks more sideways to lower, as the Bank of Japan appears more likely to raise interest rates, which could be negative for Japanese stocks. Resistance is seen at 67,000, 68,000, 69,000 and 70,000, while support is at 64,000, 62,000, 61,000, 60,000 and 59,000.
USD/JPY
The lack of intervention from the Bank of Japan allowed USD/JPY to slowly move higher and test the 160 level for most of the week. Strong U.S. employment data increased expectations for higher U.S. interest rates, helping the pair close above 160. The Bank of Japan may also raise interest rates this month, which could put pressure on USD/JPY, but for now the uptrend remains in place within a narrow range. Short-term trading is still difficult, as the pair could continue higher, but there is also a risk of a quick drop if Japan intervenes. Resistance is at 160.50, 162.00 and 165.00, while support is seen at 159.00, 158.00, 157.00, 156.00, 155.50 and 155.00.
Gold
Renewed talk of higher U.S. interest rates, along with continued U.S.-Iran negotiations, kept gold under pressure throughout the week. Strong U.S. employment data was also negative for gold, pushing prices to close near the lows. It was a disappointing week as the fundamental outlook weakened, although central bank demand may still support prices on larger falls. For this week, waiting for a rebound before looking for selling opportunities may be the better strategy. Resistance is at $4,500, $4,600, $4,665, $4,750 and $4,900, while support is at $4,300, $4,200, and $4,100.
Crude Oil
WTI crude oil traded sideways as hopes for a quick return of Middle East oil supply faded, pushing prices higher early in the week toward $100. However, resistance held, and the stronger U.S. dollar later pushed WTI back close to its weekly opening levels. With the 10-day moving average still bearish and Friday’s close looking weak, focusing on selling opportunities may be the better short-term strategy. Resistance is at $95, $100, $105, $110 and $120, while support is at $90, $80, $75, $70, and $67.50.
Bitcoin
Bitcoin suffered a very large weekly loss and hit new lows for 2026 as ETF outflows and institutional selling added pressure. Bitcoin has disappointed investors this year, with some moving money into AI and technology stocks instead. In the short term, support near the yearly lows is still holding, so there may be a short-term buying opportunity with a small stop loss. However, the medium-term outlook remains negative, so waiting for a rebound closer to the 10-day moving average may be the better strategy. Resistance is at $65,000, $75,000, $80,000, $85,000, and $90,000, while support is at $60,000, $55,000 and $50,000.
This Week’s Focus
- Monday: Australia GDP and Current Account
- Tuesday: U.S. Trade Balance and Existing Home Sales
- Wednesday: Australia Building Approvals, China CPI and PPI, U.S. CPI
- Thursday: E.U. ECB Interest Rate Decision, U.S. PPI
- Friday: Japan Industrial Production, U.K. Trade Balance and Industrial Production, U.S. Michigan Consumer Expectations
After the large market moves caused by the strong U.S. employment data, volatility may stay high as traders adjust to the growing possibility that the Fed may need to raise interest rates again. U.S. CPI and PPI inflation data will be the main focus this week, along with the ECB interest rate decision. Equities have performed strongly this year, so stronger-than-expected inflation data could increase the risk of further falls.
