Market Analysis

XAUUSD

Prediction: Decline Expected

Fundamental Analysis: 

On Wednesday, gold prices briefly surged to $2,500 during the US trading session, driven by weaker US job vacancy data. As attention turns to Thursday’s ADP employment data—often referred to as the "mini non-farm payroll"—investors anticipate further market movements. The decrease in US job vacancies heightened the likelihood of a substantial Federal Reserve rate cut in September, leading to a weaker US dollar and a decline in US bond yields, which supported the rally in gold. According to the US Bureau of Labor Statistics' Job Openings and Labor Turnover Survey (JOLTS), job vacancies dropped from a revised 7.91 million to 7.67 million, falling short of all surveyed economists' forecasts.

Technical Analysis: 

The bullish momentum in XAU/USD resumed on Wednesday, but buyers need to overcome a significant resistance level to push gold towards retesting this year’s high. The Relative Strength Index (RSI) indicates that buyers maintain control, although the short-term trend is showing signs of leveling off. If gold manages to close above $2,500, the next resistance targets will be the all-time high of $2,531, followed by $2,550. A break above these levels could see gold aiming for $2,600. However, if it remains below $2,500, the next support lies at the August 22 low of $2,470. Should it dip below this, the next key support zone would be around $2,431, where the April 12 high coincides with the 50-day Simple Moving Average (SMA).

USDJPY

Prediction: Decline Expected

Fundamental Analysis: 

On Wednesday, September 4, the Japanese yen strengthened by over 1% against the US dollar, driven by a softening US job market, which raised expectations of a more aggressive rate cut from the Federal Reserve. The latest Job Openings and Labor Turnover Survey (JOLTS) from the US Bureau of Labor Statistics revealed a drop in job vacancies from 7.91 million to 7.67 million, falling short of economists' forecasts. Following this report, market sentiment shifted towards the likelihood of a larger rate reduction by the Fed. Additionally, weaker US economic data and more hawkish remarks from the Bank of Japan bolstered the yen, as investors favored traditional safe-haven currencies during the week.

Technical Analysis: 

USD/JPY reversed its upward momentum, which saw the pair climb from $143.44 on August 26 to a high of $147.21 on September 3, with the downtrend resuming after the release of US economic data. The shift in momentum was confirmed by a bearish Relative Strength Index (RSI), suggesting a potential trend reversal in the near term. The first key support level stands at $143.45, the August 26 low. A break below this point could lead to further downside, with additional support levels at $143.00, $142.50, and $142.00. Should these levels fail, the next major target would be the August 5 low of $141.69. For bullish momentum to return, the pair would need to break above $148.45.

EURUSD

Prediction: Decline

Fundamental Analysis: 

EUR/USD saw a modest recovery on Wednesday, rebounding from its recent dip and finding support around the 1.1050 level. Despite this slight midweek rise, the pair continues to struggle below the 1.1100 threshold. The spotlight remains on US labor data ahead of Friday’s Nonfarm Payrolls (NFP) report, which will likely influence market sentiment. On the European side, the focus shifts to the upcoming Retail Sales report. Set for release on Thursday, July's EU-wide Retail Sales are anticipated to show a slight improvement of 0.1% year-on-year, following a -0.3% decline in the previous month.

Technical Analysis: 

EUR/USD has retreated to key short-term technical levels, with buyers attempting to maintain balance, though a full recovery has yet to materialize. Last week, the pair briefly hit a 13-month high, surpassing $1.1200, but recent US dollar strength has hindered the sustainability of those gains. While EUR/USD remains above the 200-day Exponential Moving Average (EMA) at $1.0845, it is under growing pressure. Sellers are targeting levels just above the 50-day EMA at $1.0956, posing a potential downside risk.

BTCUSD

Prediction: Decrease

Fundamental Analysis:

Bitcoin's sell-off remains in motion, though lower prices are drawing some buyer interest. QCP Capital has highlighted the potential for a period of heightened volatility in Bitcoin's near future. While many analysts anticipate that the Federal Reserve’s expected interest rate cut on September 18 could provide a boost to risk assets, Bitfinex analysts present a contrary perspective. They predict Bitcoin might experience a 15-20% decline following the rate cut. In their September 2 report, Bitfinex suggested that Bitcoin’s potential bottom could fall between $40,000 and $50,000. The continued pressure on Bitcoin is also weighing heavily on altcoins, leading to a decline in the total cryptocurrency market capitalization, which has dropped below $2 trillion, as per CoinMarketCap.

Technical Analysis:

Bitcoin has faced resistance at the 20-day Exponential Moving Average of $59,655, pulling back on Tuesday and dropping to the $55,724 support level by Wednesday. Buyers are expected to defend this level firmly, as a failure to hold $55,724 could push Bitcoin lower, with a potential drop to $49,000. Strong buyer interest may emerge at this level, but sellers are likely to resist any significant recovery around $55,724. If the price breaks below $49,000, the next key support could be at $42,000. Conversely, if the price rebounds from its current level and breaks above the 50-day Simple Moving Average of $61,712, the bearish outlook could be invalidated, allowing for a possible rise to $65,000, with the next resistance at $70,000.

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