

Market Analysis
XAUUSD
Prediction: Increase
Fundamental Analysis:
Gold prices are consolidating their strong gains from the previous day, maintaining a position above the $2,400 mark during the Asian session on Wednesday. Traders are awaiting further signals about the Fed's policy direction, with particular attention on the upcoming FOMC meeting results. On Tuesday, gold faced challenges in reclaiming the $2,400 level, trading just below it as the market digested US news, including the JOLTS report and an increase in the Consumer Confidence Index. Upcoming central bank decisions remain a key focus, with potential discussions by the Bank of Japan about raising rates and reducing government bond purchases. Investors are also anticipating potential hints from the Fed regarding a possible rate cut in September.
Technical Analysis:
Technically, the bearish outlook for gold (XAU/USD) appears limited. On the daily chart, the pair is trading just below a still bullish 20-day moving average, while the longer-term moving averages continue to slope upwards well below the current price level. Technical indicators remain neutral, with gold confined to a tight range for the second consecutive day. In the short term, the 4-hour chart indicates a neutral-to-bullish outlook. The pair is trading just above the 50% Fibonacci retracement of the June/July rally at $2,388.25, while remaining within directionless moving averages. However, technical indicators have shown modest improvement within positive levels, suggesting a potential upward bias.
EURUSD
Prediction: Decrease
Fundamental Analysis:
The EUR/USD pair is currently consolidating its losses around 1.0815 during the early Asian session, influenced by risk aversion and weaker-than-expected preliminary Q2 GDP figures from Germany. The pair registered modest losses on Tuesday, continuing the previous session's decline, as investors remain cautious ahead of the upcoming Federal Reserve decision.
The US dollar struggled to maintain its early gains, especially after the Japanese yen rebounded amid speculation that the Bank of Japan may signal further policy tightening. Yields on both US and German bonds declined as investors anticipate potential rate cuts from the Fed and ECB.
In terms of data, Germany's flash inflation rose more than expected, while its GDP unexpectedly contracted. Conversely, the broader Eurozone GDP growth exceeded estimates.
Technical Analysis:
For the downside, the next targets for the EUR/USD pair are the weekly low of 1.0798, the 100-day moving average at 1.0794, the June low of 1.0666, and the May low of 1.0649.
On the upside, initial resistance is found at the July high of 1.0948, followed by the March peak of 1.0981 and the key 1.1000 level. The pair's bearish bias is likely to persist if it remains below the 200-day moving average at 1.0821. The four-hour chart indicates an acceleration in the negative bias, with support levels at 1.0864, 1.0798, and 1.0709. The RSI has rebounded to around 40.
USDJPY
Prediction: Decrease
Fundamental Analysis:
The USD/JPY pair hovers around 152.50, staying above its recent three-month low as traders await the pivotal Bank of Japan (BoJ) policy decision. Markets are increasingly factoring in a higher likelihood of a rate hike, which is strengthening the Japanese Yen (JPY) and posing a challenge for the currency pair.
Looking ahead, all eyes are on the BoJ meeting, where policymakers are anticipated to raise rates by 10 basis points and outline plans to taper bond-buying operations, thereby enhancing the Yen's attractiveness. Concurrently, a modest rebound in the US Dollar has momentarily stalled the pair's upward momentum. The US Dollar Index edges higher towards 104.50 as investors adopt a cautious approach ahead of the Federal Reserve's policy meeting. Here, officials are expected to hold rates steady while maintaining dovish interest rate guidance.
Technical Analysis:
The USD/JPY pair is trading within a narrow range, maintaining its position above the critical support level of 156.00 during Monday's European session. Market participants are closely watching the forthcoming interest rate decisions by both the Bank of Japan (BoJ) and the Federal Reserve (Fed), set for Wednesday.
Expectations are that the BoJ will increase interest rates, potentially bolstering the Japanese Yen and creating a bearish environment for the USD/JPY pair. Conversely, the Fed is projected to keep rates unchanged but will provide crucial guidance on future monetary policy, which will be carefully scrutinized by the markets. As a result, traders are adopting a cautious approach, awaiting the outcomes of these significant central bank meetings before committing to major moves in the USD/JPY pair.
GBPUSD
Prediction: Decline
Fundamental Analysis:
The GBP/USD pair is trading defensively near 1.2840 in the early Asian hours on Wednesday as traders exercise caution ahead of the Federal Reserve's interest rate decision later today, followed by the Bank of England's policy meeting on Thursday. The pair dipped to a nearly three-week low below 1.2810 earlier in the week but has since regained some ground. However, the technical outlook does not indicate a sustained recovery. Investors are hesitant to take significant positions in the GBP/USD pair before the central bank announcements. Additionally, upcoming US economic data, such as the Consumer Confidence Index and JOLTS Job Openings, could influence the pair's movements.
Technical Analysis:
The GBP/USD pair is currently trading just below a descending trend line, situated at 1.2860. The Relative Strength Index (RSI) on the 4-hour chart is slightly below 50, reflecting a lack of buying interest. On the downside, the pair has interim support at 1.2830 (50% Fibonacci retracement), followed by 1.2800-1.2790 (psychological level and 200-period SMA) and 1.2750 (static level). If the GBP/USD surpasses the 1.2860 level and holds above it, the next resistance levels could be at 1.2880 (38.2% Fibonacci retracement) and 1.2900 (100-period SMA). The technical outlook indicates a consolidation phase, with neither buyers nor sellers showing clear dominance at this time.
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