Market Analysis
XAUUSD
Prediction: Decrease
Fundamental Analysis:
Gold prices have experienced a sharp decline, dropping over $40 to fall below $2380. This decline is attributed to the recent Federal Reserve meeting minutes, which conveyed a hawkish tone, strengthening the dollar and pushing gold prices lower. The minutes from the April 30 to May 1 meetings indicate that Federal Reserve officials are increasingly concerned about inflation and are not considering interest rate cuts. This strict stance has dashed hopes for a rate cut, leading to the significant drop in gold prices.
Technical Analysis:
The RSI is trending downwards, signaling a shift towards negative momentum. As selling pressure increases, buying interest is diminishing. The first support level for gold is the May 13 low of $2332, followed by the May 8 low of $2303. If these levels are breached, the next target is the 50-day SMA at $2284. Conversely, if buyers manage to push gold prices above $2400, there is potential for a rise to test this year's high of $2450.
EURUSD
Prediction: Increase
Fundamental Analysis:
The USD has continued its recovery this week, exerting additional pressure on risky assets, driving the EUR/USD pair to new five-day lows around $1.0820 on Wednesday. This strengthening of the Dollar aligns with the generally positive performance of US bond yields across various durations. Investors are anticipating that the Federal Reserve (Fed) will begin lowering interest rates in September, while there is speculation that the European Central Bank (ECB) might start reducing rates as early as June.
Technical Analysis:
The 4-hour chart reveals a slight decline from recent highs. The first resistance level is at 1.0894, followed by another at 1.0942. On the downside, the initial support level is at 1.0821, with further support at 1.0766. The Relative Strength Index (RSI) has decreased to approximately 41, suggesting that recent momentum is now shifting in favor of buyers.
US Oil
Prediction: Decrease
Fundamental Analysis:
The recent Federal Reserve meeting notes revealed disappointment with current economic data, raising the possibility of a rate cut in September. This anticipation has led to a more than 1% drop in oil prices. The notes indicated that officials are concerned with the slow progress in managing inflation, suggesting it may take longer than initially expected to bring it under control. Despite this, officials remain optimistic that price pressures will gradually subside. Lower interest rates typically reduce borrowing costs, which can stimulate economic growth and potentially increase oil demand.
Technical Analysis:
WTI US Crude Oil is currently falling to $76.50 per barrel, continuing a short-term decline from just above $80.00 per barrel. Prices have returned to a familiar demand zone below $78.00 per barrel and may drop further if they dip below $76.50. The next support level is around $75.50, which aligns with a low point observed in February, marking a return to the downward trend.
BTCUSD
Prediction: Increase
Fundamental Analysis:
Bitcoin recently dipped below $69,500 as investors cashed in profits. The upcoming approval of an Ethereum ETF might provide support for Bitcoin's short-term price increase. The drop below $69,500 isn't triggered by negative news. President Biden's decision not to veto FIT21, along with the progressing ETH ETF approval process, adds to the positive outlook. Despite this, profit-taking by investors has caused a decline in Bitcoin's price for the past few hours, creating uncertainty about the duration of this trend.
Technical Analysis:
After struggling to maintain a position above $71,500, Bitcoin's price began to decline, reaching a weekly high of $71,896 before starting to fall. Currently, Bitcoin is trading above $68,000 and is above the 100-hour Simple Moving Average. It encounters resistance around $69,650, with the first major resistance level at $70,000. If Bitcoin fails to break through $70,000, it may continue to decline, with the nearest support level situated around $69,000.
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