Trump Tariffs Implemented! Caution Needed Amidst Ongoing Dollar Strength and Yen Appreciation – Weekly Strategy for February 3, 2025

Trump Tariffs Implemented! Caution Needed Amidst Ongoing Dollar Strength and Yen Appreciation – Weekly Strategy for February 3, 2025

■ Market Trends at the Beginning of the Week

📌 Trump Tariffs Finally Set to Take Effect!

• Tariffs on Mexico, Canada, and China will officially be implemented on February 4.
• Sharp surge in the dollar at the start of the Oceania market session, with continued dollar buying in the Tokyo session.
• Nikkei 225 drops over 1,000 points, prompting risk-off yen buying.

📌 Key Events This Week

• February 6 (Thursday) – BOE Interest Rate Decision (Impact on GBP)
• February 7 (Friday) – U.S. January Nonfarm Payrolls (Impact on FOMC rate cut expectations)
• However, since Trump tariffs dominate market sentiment, the impact of regular economic indicators may be limited in the first half of the week.

📌 Key Market Focus

• Dollar buying surged at the Oceania market open → Watch for potential corrections in the London session.
• Timing of a potential pullback from the rapid dollar appreciation is crucial.
• Investors who missed the dollar rally may look for dip-buying opportunities → Need to balance between selling rallies and buying dips.

■ Weekly Market Strategy

✅ Currencies to Sell

EUR (Euro) & CAD (Canadian Dollar)

• Directly impacted by Trump tariffs
• Canadian Dollar (CAD) is highly dependent on exports to the U.S., making it vulnerable to trade conflicts.
• Euro (EUR) faces further downside risks due to ECB’s potential rate cuts and a sluggish European economy.

✅ Assets to Buy

AUD (Australian Dollar) & NZD (New Zealand Dollar)

• Relatively less affected by Trump tariffs
• Potential support from RBA (Reserve Bank of Australia) and RBNZ (Reserve Bank of New Zealand) policies, making them attractive for short-term rebounds.

U.S. Stocks (S&P 500 & NASDAQ)

• Market likely to digest Trump tariff impact in the short term
• With the FOMC hesitant on rate cuts, stocks may find buying opportunities after an initial pullback

Cryptocurrencies (BTC, ETH, SOL, etc.)

• Short-term selling pressure from a strong dollar, but long-term capital inflows into risk assets expected
• Bitcoin’s move toward breaking $100,000 remains in focus

Gold (XAU/USD)

• Safe-haven demand remains strong amid ongoing risk aversion
• Further upside potential depending on FOMC’s stance on interest rates

■ Specific Entry Points

■ Key Economic Events

📌 February 5 (Tuesday)

• U.S. December JOLTS Job Openings
  📌 February 6 (Wednesday)
• BOE Interest Rate Decision (Impact on GBP)
  📌 February 7 (Friday)
• U.S. January Nonfarm Payrolls (Biggest event of the week!)

■ Weekly Trading Plan

✅ Identify short-term trends before entering trades (High volatility demands caution)
✅ Sell currencies impacted by tariffs (EUR & CAD)
✅ Remain bullish on risk assets (AUD, NZD, Cryptos, Gold, U.S. Stocks)
✅ First half of the week is dominated by Trump tariffs, while the latter half focuses on U.S. jobs data

■ Summary

This week’s market is dominated by “Trump Tariffs” + “U.S. Nonfarm Payrolls”, shaping trading strategies.
While dollar strength and yen appreciation may persist, opportunities exist in risk assets such as cryptos, gold, and U.S. stocks.

Main strategy: Short EUR & CAD, while looking for buying opportunities in AUD, NZD, Gold, and BTC!
With high market volatility, position management is crucial. Stay flexible and adapt to the changing landscape. 💹🔥