FTSE falls as Trump’s tariff rollercoaster continues
The FTSE 100, along with its European peers, is heading lower again, extending the tariff-driven selloff from the previous session.President Trump agreed on Monday to postpone 25% tariffs on Canada’s Brexit ko following discussions with the leaders of countries. However, a 10% tariff on China took effect today, with Beijing retaliating with new tariffs on selected US imports.The latest developments raise the threat of a trade war between the world’s two largest economies, spurring a risk-off mood in the market.The UK economic calendar is quiet today, so attention will remain on any signs of negotiations surrounding trade tariffs or any further threats from Donald Trump, particularly towards the UK.Looking out across the week, the Bank of England’s interest rate decision is on Thursday. The central bank is expected to cut interest rates by 25 basis points to 4.5% and could signal to further rate cuts throughout the year.In corporate news, Vodafone has opened 5% lower after its Q3 update showed further pressure on revenue in Germany. Meanwhile, Diageo is also down 3%, adding to yesterday’s decline of 2.2% after the company removed mid-term guidance from half-year results.Oil major BP is under pressure, tracking oil prices lower. However, miners, which often come under pressure on bad news from China, are holding up well.
FTSE forecast – technical analysisThe FTSE broke out of the channel within which it had been trading since May last year, reaching a fresh record high of 8690 last week. The price has corrected lower from this resistance, falling below 8580 to a more neutral stance.A rise back above 8580 could see buyers look to retest the 8690 for fresh record highs.Support can be seen at 8480. A break below this level opens the door to 8400. 
EUR/USD struggles below 1.03 with trade tariffs in focus
EUR/USD remains under pressure, holding losses below 1.03 as tariff risks remain heightened even after President Trump poses tariffs on Canada and Mexico. Trade tariff headlines are likely to remain the key driver of price action in the coming weeks amid risks that Trump could announce measures against Europe.While Trump has applied tariffs to China, he appears to be using these announcements as a negotiating tool. This could be another case of Trump’s bark being worse than his bite, but markets remain wary with the EU next in line.The motives for tariffs in the EU are not border-related like they are with Mexico and Canada, but they would be based on trade imbalances which could require more time to negotiate, making a quick deal unlikely. As a result, a strong rebound in the euro is looking challenging.While all eyes were on trade tariff headlines yesterday, eurozone flash CPI estimates came in slightly hotter than expected. Core CPI was unchanged at 2.7%, ahead of the 2.6% expected, holding at this level for a fifth straight month. Headline CPI inched higher for a fourth month in a row, raising some questions about the ECB’s optimistic stance towards disinflation.The US dollar is pushing higher today on safe-haven trade, fueled by fears of a US-China trade war. Should there be signs of progress in negotiations and a trade deal between the two economies, the US dollar could appreciate.Attention will also be on US factory orders and JOLTS job openings data later today ahead of Friday’s nonfarm payroll..
EUR/USD forecast – technical analysisAfter running into resistance at 1.0530, EUR/USD rebounded lower to 1.0210. The price recovered from this low, rising above the multi-month falling trendline, but failed to retake the 1.0330 resistance, the November low.The long lower wick on yesterday’s chart suggests little selling pressure at the lower level. However, failure to retake the 1.0330 resistance and the RSI below 50 create a mixed picture.Buyers will need to rise above 1.0330 to extend gains to 1.04 and 1.0450. A rise above 1.0530 creates a higher high.Sellers will need to take out the falling trendline support at 1.0270 to retest 1.02. 
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