empty
InstaForex - Official partner of Dragon Racing
InstaForex - Official partner of Dragon Racing
This section is designed for those who are just starting their trading journey. InstaForex educational and analytical materials will meet your training needs. Our experts' recommendations will make your first steps to trading success simple and clear.
Start as Beginner
How to start trading
Useful information
Training and recordings
InstaForex innovative services are an essential element of productive investment. We strive to provide our clients with advanced technical capabilities and make their trading routine comfortable as we are recognized as the best broker in this regard.
Become Investor
PAMM System
ForexCopy System
Passive investments
Partnership with InstaForex is beneficial and top-tier. Join our affiliate programs and enjoy bonuses, partner rewards, and the possibility to travel with the team of the world-renowned brand.
Become Partner
Main Page
Partner Area
Advantages for Affiliates
Registration
This section contains the most lucrative offers from InstaForex. Receive bonuses when topping up an account, compete with other traders, and get real prizes even when trading in a demo account.
All Promo Campaigns
Bonuses
Contests
Events
Holidays with InstaForex are not only pleasant but also useful. We offer a one-stop portal, numerous forums, and corporate blogs, where traders can exchange experiences and become successfully integrated into the Forex community.
Full details
Forums
We are in social networks
Forex humour
Forex Portal
InstaForex is an international brand created in 2007. The company provides services for online FX trading and is recognized as one of the world's leading brokers. We have won the trust of more than 7,000,000 retail traders, who have already appreciated our reliability and focus on innovations.
Learn More
History
Why Choose Us
InstaSport
Regulation
Company News
Awards
InstaForex Stars
InstaForex Offline
Headquarters
Key documents
Social Responsibility
25.04.2025 11:57 AM
The Market Has Nowhere Left to Run
Open trading account Open demo account

While Donald Trump and Beijing are still trying to figure out whether trade negotiations between the U.S. and China are happening at all, the S&P 500 continues to climb for a third straight day — this time thanks to dovish rhetoric from the Federal Reserve. FOMC member Christopher Waller suggested that tariffs would only cause a temporary increase in prices, which the Fed should ignore. However, cooling in the labor market, he said, could prompt a resumption of monetary expansion.

Markets seem to intuitively feel that the tariffs announced on America's "Liberation Day" are the limit — the White House is unlikely to go any further. Import duties will likely be reduced, and the U.S. economy is expected to avoid a recession. This is also supported by the sharp increase in durable goods orders in March. As a result, the S&P 500's late-April rally is being led by those who have suffered the most from protectionism — namely tech stocks and the "Magnificent Seven."

However, there are growing doubts about the wisdom of moving capital from North America to Europe. Around 60% of companies included in the EuroStoxx 600 index generate their revenues abroad. A weaker U.S. dollar negatively impacts their financial performance.

U.S. Dollar vs. EuroStoxx 600 Basket Dynamics

This image is no longer relevant

At the same time, a falling dollar isn't great news for the U.S. market either. Only about one-third of S&P 500 companies are export-oriented — their foreign currency revenues will rise. But two-thirds are focused on the domestic market. Rising import prices reduce Americans' purchasing power and cut into corporate revenues.

The current S&P 500 rally has limited upside, as the White House shows no signs of abandoning its tariff policies or its push to bring manufacturing back to America. Escalation of the trade war with China is only a matter of time. Furthermore, the uncertainty surrounding Washington's protectionist policies will inevitably impact the U.S. economy, reviving recession concerns.

U.S. Dollar vs. S&P 500 Earnings Outlook

This image is no longer relevant

Given this backdrop, the most likely scenario is a period of consolidation for the broad stock index. The exact range of this consolidation will become clearer over the next few trading sessions.

This image is no longer relevant

Thus, in the U.S. stock market, fear has temporarily given way to greed, allowing the S&P 500 to recover part of its losses and exit correction territory. Currently, the index is down less than 6% for the year — compared to as much as 15% in early April.

Technically, on the daily chart, bulls have activated a "1-2-3" pattern by breaking above fair value at 5400. This allowed traders to build long positions. However, this does not signal a return to a full uptrend. On the contrary, a rejection at resistance levels of 5500, 5625, or 5695 would be a signal to take profits and possibly reverse direction. The base case remains a medium-term consolidation in the broad stock index.

Marek Petkovich,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
All Analytics
Crypto-currencies
Crypto market opens with buoyant growth US stock index futures surged sharply at the opening of today's trading session on news that representatives from the US and China have resumed consultations on trade matters. Media reports
Jurij Tolin
14:14 2025-05-07 +02:00
1105
Analytical News
Gold slips, stocks sink: what India, Germany and the Fed have in common Equities are falling on stalled tariff agreements ahead of the Fed decision. Gold is sliding on renewed US-China talks. UK and India have clinched a major trade pact. Friedrich Merz
12:36 2025-05-07 +02:00
1120
Breaking Forecast Trading Plan Cryptocurrencies USD/RUB Russian Economy Video Analysis
Trading Instruments
EURUSD GBPUSD USDCHF USDCAD USDJPY AUDUSD EURGBP EURJPY NZDUSD EURNZD Silver Gold #CL #USDX COVID-19 Bitcoin
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

U.S. Trade Deficit Hits Record High in March

The euro responded with an increase following the news that the U.S. trade deficit rose to a record level in March this year, as companies rushed to import goods, including
Jakub Novak 10:48 2025-05-07 UTC+2

Markets Will Not Be Dictated To

The market's eyes have finally opened. Donald Trump is not the kind of president who would lower tariffs in response to reciprocal reductions from other countries. The occupant
Marek Petkovich 09:56 2025-05-07 UTC+2

Is It Worth Hoping for a Strong Market Rally? (There is a high probability of continued growth in #SPX and #NDX)

Equity markets have improved, demand for cryptocurrencies has risen, yet gold prices dropped sharply after a local rally. Meanwhile, the U.S. dollar has remained almost unchanged against major currencies
Pati Gani 09:28 2025-05-07 UTC+2

USD/JPY: Is Further Decline Inevitable?

The Bank of Japan left its monetary policy unchanged during the monetary policy meeting on May 1. In the "Outlook for Economic Activity and Prices" report, the Bank lowered
Kuvat Raharjo 09:28 2025-05-07 UTC+2

Gold Returns to Growth

Gold has resumed its upward movement as investors analyzed trade-related comments from U.S. Treasury Secretary Scott Bessent while awaiting the Federal Reserve's decision on interest rates. Bessent recently stated that
Jakub Novak 09:14 2025-05-07 UTC+2

What to Pay Attention to on May 7? A Breakdown of Fundamental Events for Beginners

Very few macroeconomic events are scheduled for Wednesday, and in any case, they are unlikely to have any meaningful impact on either of the currency pairs. The euro remains
Paolo Greco 06:55 2025-05-07 UTC+2

GBP/USD Overview – May 7: Trump Didn't Get a Call from China, Had to Back Down

On Tuesday, while the euro remained stuck in a flat trend, the GBP/USD currency pair began a new upward move. The rally started on Monday, but during the U.S. session
Paolo Greco 03:35 2025-05-07 UTC+2

EUR/USD Overview – May 7: The Fed Meeting Becomes the Dollar's New "Headache"

The EUR/USD currency pair continued to trade strictly sideways on Tuesday. The broader flat market has now lasted for nearly a month, and in addition to that, the market seems
Paolo Greco 03:35 2025-05-07 UTC+2

Trade War as Part of Global Confrontation

Many may believe that the trade war initiated by Donald Trump is simply a tool to reduce the budget deficit and national debt. However, it becomes clear upon closer examination
Chin Zhao 01:06 2025-05-07 UTC+2

May FOMC Meeting: A Preview

We'll learn the results of the Federal Reserve's latest policy meeting on Wednesday. On one hand, it's a routine event with a predetermined outcome. On the other hand, the currency
Irina Manzenko 00:32 2025-05-07 UTC+2

Top analytics

Relevance up to 20:00 2025-05-07 UTC--4
EUR/USD Overview – May 7: The Fed Meeting Becomes the Dollar's New "Headache"
03:35 2025-05-07
Fundamental analysis
Relevance up to 20:00 2025-05-07 UTC--4
GBP/USD Overview – May 7: Trump Didn't Get a Call from China, Had to Back Down
03:35 2025-05-07
Fundamental analysis
Relevance up to 03:00 2025-05-08 UTC--4
Gold Returns to Growth
09:14 2025-05-07
Fundamental analysis
Relevance up to 00:00 2025-05-08 UTC--4
What to Pay Attention to on May 7? A Breakdown of Fundamental Events for Beginners
06:55 2025-05-07
Fundamental analysis
Relevance up to 03:00 2025-05-08 UTC--4
EUR/USD – May 7th: Bulls Are Reversing the Trend
10:56 2025-05-07
Technical analysis
Can't speak right now?
Ask your question in the chat.
Widget callback
Callback widget
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.