

Market Analysis
XAUUSD
Forecast: Anticipating an Increase
Fundamental Analysis:
Recent comments from some Federal Reserve officials suggest a willingness to consider interest rate cuts if necessary, though they indicated that there is no immediate need for such action. This stance has been interpreted positively by the markets, leading to increased buying pressure for gold. Presently, the market anticipates a 66.3% likelihood of a rate cut in June, a rise of 3% since the PCE report. Lower interest rates could support gold, which does not yield interest.
Technical Analysis:
Gold is currently trading above key simple moving averages (21, 50, and 100-period SMAs), reflecting a robust bullish trend. The immediate resistance level is set at the round number of $2050, which corresponds to yesterday’s high, while the 50-period SMA, approximately $2033.07, is expected to act as immediate support. The Relative Strength Index (RSI) is currently at 60.03, well below the overbought threshold of 70, suggesting there is room for further upward movement.
EURUSD
Forecast: Expecting a Decline
Fundamental Analysis:
In July, the euro has shown relative strength against the U.S. dollar. However, BCA Research predicts challenging times ahead for the eurozone and advises investors to consider selling the euro. As of 08:50 ET (12:50 GMT), the EUR/USD pair stands at 1.0818, reflecting a 0.4% drop for the day but a 1% increase over the past month. Despite these recent gains, BCA Research recommends a cautious approach towards European assets due to the anticipated risk of recession. The European Central Bank (ECB) reduced its benchmark interest rates in early June, preceding the U.S. Federal Reserve and the Bank of England. Further rate cuts by the ECB are anticipated later this year, but BCA Research believes these measures may be insufficient to counteract economic downturns.
Technical Analysis:
The EUR/USD is currently testing the 200-day and 50-day moving averages, which are providing near-term support as the market awaits the FOMC meeting and the Non-Farm Payroll report this week. While the Fed is likely to keep rates steady, there is a possibility of a dovish stance based on recent economic data. Additionally, the jobs report might indicate some economic weakness. Considering these factors, maintaining a long position on EUR/USD around the 1.0800 level could be advantageous, particularly with the formation of a bullish pennant pattern. A move above 1.0880 would validate this bullish setup, whereas a drop below 1.0773 would invalidate it.
USDJPY
Prediction: Anticipated Decline
Fundamental Analysis:
On Wednesday, the Japanese yen strengthened against major currencies in anticipation of the upcoming Bank of Japan (BoJ) meeting next week. In its June meeting, the BoJ indicated that it would provide more details on its balance sheet reduction plans by the end of this month. Japan is gradually moving towards policy normalization, with expectations of rate hikes to a neutral range of 0.5% to 1.5%. However, the BoJ is balancing encouraging inflation data with weaker consumer spending. The aim is to boost local consumption and household sentiment through tax cuts and increased wages, hoping to consistently achieve the 2% inflation target.
Technical Analysis:
The weekly chart for USD/JPY shows the expected trading range for Q3, starting with an upward trend at the beginning of the quarter followed by a notable decline as the yen recovers lost ground. A key support level to watch is 151.90, which marks the point where Tokyo intervened in the FX market in 2022.
BTCUSD
Prediction: Expected Increase
Fundamental Analysis:
Bitcoin showed a decline earlier in the week but later rebounded. This rebound was fueled by growing optimism ahead of Donald Trump's appearance at the Bitcoin conference. The cryptocurrency aimed to approach its all-time highs. Bitcoin faced a week of volatility, first dropping to support levels before recovering sharply. It surged from a low of $63,450 to a high of $67,000, marking a 5% increase. The anticipation surrounding Trump’s speech at the Bitcoin Conference has driven this recent uptrend, as markets often react positively to developments involving the former US president.
Technical Analysis:
Bitcoin has identified $65,000 as a crucial support level over the past week. A secondary support level around $63,500 aligns with short-term EMA values. Staying above $65,000 is essential for Bitcoin to attract new buyers and maintain its upward trajectory. On the upside, Bitcoin faced resistance at $68,000 this week, which corresponds to the Fib 0.786 level from June’s retracement. Key levels to monitor include $65,300 and $67,850, which will impact the trend's direction. If Bitcoin closes the week near $68,000, it could target a new record high in the following week. Should it surpass its previous record, the short-term target price range is between $75,000 and $80,000.
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