Euro Holds Ground as Dollar Confidence Wanes; EUR/USD Tests Key Resistance

Market Overview

Australia

The Australian dollar has remained relatively stable, holding onto most of its recent gains ahead of the Reserve Bank of Australia's (RBA) policy announcement, with expectations for a 25 basis point rate cut. Despite a broader market weakness in the US dollar due to concerns over the US's fiscal situation and trade tensions, the Aussie remains resilient. The RBA's expected rate cut may reflect ongoing 
concerns about inflation and economic conditions.

The US dollar has faced downward pressure after Moody's downgraded the US sovereign credit rating, exacerbating fears over the country's growing debt. Trade tensions, particularly with the EU and China, have added to the negative sentiment, but the Australian dollar has benefited from the global risk-off mood. 

Cryptocurrency

The crypto market remains bullish as Bitcoin holds firmly above the $100,000 level, with the current uptrend seen as “healthy” and showing no signs of overheating. According to CryptoQuant and the Macro Trend Oscillator (MTO) model, BTC still has room to rise before reaching its cycle peak. ETF inflows are recovering, and long-term holders are not selling, reflecting continued investor confidence.

Several cycle valuation models, such as the Golden Ratio and forecasts from Bitcoin Suisse, suggest BTC could reach $160,000–$250,000 in 2025 if macroeconomic conditions remain favorable.

XAU/USD

Prediction: Sideways

Gold is currently trading around $3,219 after rising sharply to $3,228.90 during the first session of the week. The short-term trend structure is still in a consolidation phase, with small technical corrections. On the H4 chart, the price is fluctuating around the EMA 200 ($3,222), below the EMA 34 and EMA 89, indicating weak upward pressure. However, the long-term uptrend has not been broken if the price maintains the $3,212 level.

FUNDAMENTAL ANALYSIS

Monetary Policy and Impact from the Fed:

The Fed has not introduced any new policies, but statements from officials like Bostic, Williams, and Kashkari today may clarify the upcoming direction.

Moody's recently downgraded the U.S. credit rating due to high budget deficits and rising borrowing costs, raising doubts about the ability to maintain high interest rates.

President Trump’s tax and spending package has been initially approved, which could increase fiscal pressure and indirectly support gold.

Inflation and Market Drivers:

CPI and PPI data will be the deciding factor for the short-term direction of gold prices. If the data exceeds expectations, the Fed may keep interest rates higher for longer, putting downward pressure on gold. Conversely, lower-than-expected data would reinforce expectations of easing.

Gold prices in May have risen 22.81% from the beginning of the year and are still considered a safe-haven asset.

Geopolitical and Market Sentiment:

Geopolitical instability remains unresolved: the U.S.-China tariff dispute has not been settled, and the 90-day ceasefire deadline will end in early August.

Risk-aversion demand remains, as hedge funds hold the lowest long positions of the year. This could limit gold's downside, even though short-term technical pressure still exists.

TECHNICAL ANALYSIS

Key Resistance Levels 

• $3,298: EMA 89 zone – short-term dynamic resistance
• $3,380 – $3,440: GAP & Bear OB zone – strong resistance
• $3,500: Historical peak – long-term hard resistance

Key Support Levels

• $3,212: EMA 200 H4 – nearest support
• $3,163 – $3,125: Demand zone, previously providing strong rebounds
• $3,057: Further support if the $3,125 level is lost

Technical Indicators:

RSI is currently at 50.28, fluctuating around neutral. It previously exceeded the overbought zone (80.83) and is now in a correction phase. If RSI breaks below 50 along with a loss of EMA 200, it could trigger a deeper decline.

EMA: The price is currently below EMA 34 ($3,231) and EMA 89 ($3,256), but still above EMA 200 ($3,222), showing that the long-term trend has not broken. EMA 34 is showing signs of crossing below EMA 89 from above, signaling short-term weakness.

Volume: Volume is gradually decreasing within the sideways range, indicating a lack of momentum and a wait-and-see sentiment. Without any significant news, the price could continue to consolidate around $3,212 – $3,230.

 

EUR/USD

 

Prediction: Sideways

EUR/USD is still fluctuating within a consolidation range after a sharp drop in early May. The price has rebounded from the support level at $1.10759 and is now approaching the resistance zone at $1.12423 – $1.12753. The short-term trend slightly favors an upward movement, but there are no clear signs of a full reversal yet.

FUNDAMENTAL ANALYSIS

Monetary Policy and Impact from the Fed:

The Fed continues to maintain a cautious stance due to rising inflation pressures from new import taxes.

Fed Atlanta President Bostic signaled that the Fed may only cut rates by 25 basis points in 2025, which prevents the USD from weakening immediately.

Moody's unexpected downgrade of the U.S. credit rating, along with concerns over unsustainable public debt, has raised expectations that the Fed will adopt a more cautious approach, putting pressure on the USD.

U.S. Economic Situation & Macro Data:

President Trump's tax cuts, which are expected to add $3 – $5 trillion to the national debt, have raised fiscal concerns.

The 10-year Treasury yield has risen to 4.564%, but the USD has weakened due to a loss of long-term confidence.

The DXY has dropped 10.6% from its January 2025 peak, indicating a significant adjustment, and the downward trend in the USD continues.

Geopolitical Situation & Market Sentiment:

The “sell USD on rallies” sentiment is widespread among international investors.

The loss of confidence in the USD as a safe-haven asset has led to capital flows shifting to other assets.

The ECB has not signaled strong easing, and President Lagarde stated that the USD's weakness is due to a loss of confidence in U.S. fiscal policy, which supports EUR.

TECHNICAL ANALYSIS

Key Resistance Levels 

• $1.12423 – $1.12753: Nearest resistance zone. A break above this could open the path to $1.13828.
• $1.13828: Medium-term key resistance.
• $1.14842 – $1.15597: Strong resistance zone, overlapping with Bear OB on the chart.

Key Support Levels 

• $1.12000 – $1.11804: Nearest support, currently being tested.
• $1.10759: Important medium-term support.
• $1.09461 – $1.08747: Deeper support, in case of a strong reversal.

Technical Indicators:

RSI: Currently at 56.58, above neutral and heading upwards – indicating that recovery momentum is forming but not yet strong.

Trading Volume: Volume is gradually increasing as the price recovers – indicating that buying pressure is returning. However, further monitoring is needed to confirm a sustainable trend.

EMA: The price is currently above the EMA 89 but below the EMA 200, indicating an attempt to recover but not yet confirming a strong uptrend. EMA 34 has slightly crossed above EMA 89, which could be an early signal of a recovery trend.

 

BTC/USD

Prediction: Bullish

Bitcoin continues to maintain a strong upward trend since its April low at $74,508. It has now surpassed the $106,000 mark and is trading around $106,473. Although there are short-term corrections, the uptrend structure remains intact with higher highs and lows, supported by the EMA from below.

FUNDAMENTAL ANALYSIS

Monetary Policy & Impact from the Fed:

The Fed is showing signs of being more dovish after the tightening phase in 2024. Inflation is gradually stabilizing, which has encouraged capital to flow back into risk assets like Bitcoin.

Keeping interest rates high for an extended period is pushing investors to seek better yields, with BTC standing out as a "high-growth asset."

Inflation & Market Drivers:

Bitcoin's price is recovering without showing signs of being "overheated." According to

CryptoQuant, there has been no sharp increase in the funding rate like in previous cycles, helping the market maintain stability. Actual buying demand has steadily increased since 2023, indicating that this is a healthy growth cycle.

Geopolitical Situation & Market Sentiment:

Geopolitical stability and clearer U.S. trade policies post-election have brought investors back to the market. Additionally, BTC is increasingly being recognized as a store of value asset alongside gold. Fidelity suggests that Bitcoin's Sharpe ratio is approaching that of gold, reinforcing its role as a Store of Value (SoV).

ETF Fund Flow & Cycle Model:

After a quiet Q1, ETF fund flows into Bitcoin are picking up again. The Macro Trend Oscillator (MTO) model indicates that BTC is still in the early stages of the upcycle and has not yet reached its peak. Several long-term cycle models (Golden Ratio, Bridge-Gold Model) are targeting a price range of $160,000 – $250,000 in 2025.

On-Chain Volatility:

The long-term holding rate remains high, with 88% of circulating supply in profit. There is no strong sign of distribution, suggesting that price appreciation expectations are still being maintained.

TECHNICAL ANALYSIS

Key Resistance Levels 

• $107,115: The most recent local peak. A break above this could lead to a retest of the historical high.
• $109,356: The ATH on January 20, 2025 – the next major target.
• $115,000: The next technical target based on a $10K per wave model.

Key Support Levels 

• $105,281: The nearest support after the breakout.
• $102,374: Strong support zone, coinciding with EMA 89 on the H4 chart.
• $97,766: Long-term support zone, coinciding with EMA 200 – offering both psychological and technical support.

Technical Indicators:

EMA: The price is above EMA 34 and EMA 89, showing that the short- and medium-term bullish trends are still strong. EMA 200 is significantly lower at $97,457, confirming the long-term trend is still solid.

RSI: Currently at 61.24 – not overbought, leaving room for further upward movement. Earlier, RSI reached the overbought zone (80) and has slightly corrected, indicating that buying pressure is still present.

Trading Volume: Volume surged during the breakout above $105,281, confirming that capital flows are supporting the buyers. If volume remains high, the possibility of breaking $107K and targeting the ATH is entirely feasible.

 

 

 

 

 

 

 

 

 

 

 

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