Market Analysis
XAUUSD
Anticipated Trend: Upward
Fundamental Analysis:
Recent US GDP figures released on Thursday revealed a growth rate of 1.6%, falling below market expectations. Additionally, inflation surged to 3.7%, surpassing forecasts. This unexpected economic performance suggests a significant slowdown in the US economy, prompting speculations that the Federal Reserve may delay interest rate cuts until September. Consequently, the weakening US dollar has bolstered the value of XAU/USD.
Technical Analysis:
A key observation in the technical analysis is the potential breakthrough of the $2330 resistance level. The underperformance of the US GDP has provided considerable momentum, potentially enabling XAU/USD to surpass the Fibonacci 61.8% resistance point. Sustained trading above $2350 may pave the way for further upward movement towards the next resistance zone, ranging between $2390 and $2400.
USDJPY
USDJPY Forecast: Bullish
Fundamental Analysis:
The USD/JPY pair has experienced a 0.2% ascent, reaching $155.67, marking its highest level since 1990, surpassing the pivotal $155 threshold. This surge in value of the dollar against the yen has reignited speculations regarding potential government intervention in the currency market. Japanese Finance Minister Shunichi Suzuki, alongside other authorities, has emphasized vigilant monitoring of currency fluctuations, hinting at possible intervention measures. Meanwhile, the Bank of Japan concludes its latest policy-setting meeting today, with expectations leaning towards maintaining unchanged interest rates following a notable hike in March.
Technical Analysis:
Market observers remain on the lookout for signs of intervention as the yen breaches the critical $155 level. Investor sentiment suggests a bullish trajectory, with expectations poised for a further uptick towards $156.
EURUSD
Prediction: Rise
Fundamental Analysis:
EURUSD is on an upward trajectory once again, gaining momentum during the American trading session as it surpassed the $1.0700 mark. The resilience of the Euro against the US Dollar is notable, particularly in the wake of lower-than-expected US GDP figures for the first quarter.
A significant factor driving this trend is the comparative inflation performance between Europe and the US. In Europe, inflation remains relatively robust, prompting speculation that the region may need to implement more aggressive interest rate hikes or maintain higher rates for an extended period. Should this scenario unfold, it is likely to further bolster the ongoing uptrend in EUR/USD, which originated in September 2022 and shows signs of strengthening over subsequent quarters.
Technical Analysis:
From a technical standpoint, analysis of the 4-hour chart indicates that the Relative Strength Index (RSI) has yet to surpass the 70 threshold, suggesting that EUR/USD still has room to ascend before reaching technical overbought conditions. Presently, the price is testing the Fibonacci 38.2% level, and a successful breach could pave the way for EUR/USD to target $1.076.
BTCUSD
Prediction: Decline
Fundamental Analysis:
The latest US GDP figures for Q1 fell short of market expectations, leading to a weakening US dollar and a sudden uptick in BTC/USD. However, the recent downturn in the market can be attributed to US President Joe Biden's proposal to significantly raise capital gains tax rates to 44.6%, the highest level since 1922. Additionally, there's a proposed 25% tax on unrealized capital gains for affluent individuals.
Technical Analysis:
Bitcoin is presently trading within a range, finding support around $62,000 and facing resistance near $67,000. Short-term trends indicate a sideways movement, suggesting a likelihood of continued direction soon. Investor sentiment leans towards a continued downward trajectory, with expectations that Bitcoin may test the $60,000 support level before potentially rebounding towards $67,000.
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