Nick Goold
Markets stayed highly volatile on Friday after China announced a 34% tariff on all U.S. goods, triggering a sharp global selloff. U.S. stocks dropped across the board, and traders quickly shifted focus away from economic data and toward the growing risk of a longer trade fight and global slowdown. Even though the March U.S. jobs report showed a strong gain of +228K, the market mostly ignored it, seeing it as old news in the face of fast-moving developments.
The Federal Reserve is currently taking a cautious approach. Chair Jerome Powell said tariffs could lead to both higher inflation and slower growth, and the Fed will wait for clarity before making any policy changes. Meanwhile, President Trump called for rate cuts and said he was in “deal mode” after a call with Vietnam. Other countries also started preparing their responses, trying to avoid a full trade war with the United States.
Markets This Week
U.S. Stocks
Last week marked the worst week for U.S. markets since the 2020 pandemic crash. Despite the heavy drop, this market has been good for day traders, with strong intraday moves creating many short-term opportunities. While the medium-term outlook is unclear, some of the selling pressure may now be easing.
Short-term traders should look to capitalize on volatility, while medium-term traders should watch closely to see whether trade tensions de-escalate or worsen in the week ahead.
Japanese Stocks
The Nikkei 225 dropped 3% on Friday and finished the week down more than 7.5%.
A positive sign was that USD/JPY held support at 145, easing pressure on Japanese exporters. Also, Prime Minister Ishiba said he hopes to speak with President Trump next week, which could support the market if it leads to more dialogue.
While a short-term recovery is possible, the Nikkei has already climbed a lot over the past few years. Further selling remains a risk, so for now, focusing on intraday moves and reacting to news is the best strategy.
USD/JPY
The yen strengthened as risk sentiment collapsed, pushing USD/JPY below 145 for the first time since October 2024. It later rebounded as the dollar found support, but volatility remains high.
The new tariffs lower the chance of Japanese rate hikes, which is supportive for USD/JPY. This pair is offering many short-term trading opportunities. A potential strategy is to consider selling above 148 and buying between 145 and 146, while staying ready to exit quickly if negative news emerges. A confirmed break below 145 could lead to a larger move lower.
Gold
Gold broke below its 10-day moving average last week — a level that has supported the uptrend for much of 2025. Combined with Powell’s message that the Fed can wait, momentum is slowing down.
If tariffs keep inflation higher for longer, the Fed may cut rates more slowly, which is bearish for gold in the near term. Gold also hit a new high on Thursday, so profit-taking is normal at these levels.
As long as $3000 holds, the uptrend is still intact. But if that level breaks, gold could see more selling.
Bitcoin
Bitcoin has been under pressure but stayed relatively quiet compared to stocks or currencies. It dropped on Friday during the market selloff and weakened slightly over the weekend.
The price is still near key support at $80,000. For now, there is no clear trend, so range trading makes sense until a stronger move develops.
This Week’s Focus
Wednesday: FOMC Meeting Minutes
Thursday: U.S. CPI
Friday: U.S. PPI and Michigan Consumer Sentiment
All Week: Speeches from Fed officials
Outside of economic data, the big question is how other countries react to U.S. tariffs. China has already responded. Now traders are watching Japan, the EU, and others. Any new retaliation could push markets lower. On the other hand, signs of deal-making or delays could help the market bounce.
What Traders Should Focus On This Week
This week offers many trading opportunities, but success depends on staying calm, being prepared, and reacting to what the market is doing — not what we expect it to do. Here's how to stay focused:
1. Stay open and flexible
Don’t hold onto one strong opinion. Markets can shift quickly, and price action is the most honest signal. If conditions change, be ready to adapt your plan instead of forcing a trade to work.
2. Don’t think too long term
This is not the time to guess where the market will be in a month. Focus on today and tomorrow. Follow short-term momentum, react to headlines, and manage risk on a day-to-day basis.
3. Keep losses small
Not every trade will work. What matters is how fast you cut losses. Taking a small hit is part of trading — it allows you to stay in the game and be ready for the next opportunity.
4. Don’t add too much to losing trades
Averaging into a losing trade once or twice can help if done with a clear plan. But adding too often increases your risk fast. Keep position sizes controlled, and never let a small trade turn into a large problem.
5. Focus on fewer trades
It’s better to manage a few strong setups well than to chase too many at once. A focused approach leads to better decisions, clearer entries, and stronger follow-through. Quality over quantity wins in this environment.
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