Market Analysis

XAUUSD

Prediction: Decrease

Fundamental Analysis:

U.S. government bond yields increased on Tuesday, and the dollar began to strengthen following hawkish remarks from Federal Reserve Board member Bowman. Gold prices fell significantly after reaching a weekly high of $2,334. The Federal Reserve anticipates that U.S. inflation will stay elevated for a while and sees a risk of it increasing further, making it an unsuitable time to lower interest rates. Gold traders are now focusing on the PCE Price Index, the Fed's favored measure of inflation. If this data is lower than expected, it could renew hopes for interest rate cuts next year.

Technical Analysis:

Gold prices have a key support level at $2,300. If prices drop below this level, they could fall to the May 3 low of $2,277 and then to the March 21 high of $2,222. Conversely, if gold prices rebound to $2,350, they will target key resistance levels, including the June 7 cycle high of $2,387, and then challenge $2,400. As long as gold remains below $2,340.10, the bearish trend is expected to continue. The primary target for gold is $2,272.06.

EURUSD

Prediction: Increase

Fundamental Analysis:

On Wednesday, the EUR/USD remained around familiar levels, trading just above $1.0700 as traders awaited significant data releases. Market activity was subdued, with traders anticipating that new data would drive movements starting on Thursday. The economic calendar for Wednesday was light, but the latest German GfK Consumer Confidence Survey for July was expected to improve slightly from -20.9 to -18.9.

Technical Analysis:

If the EUR/USD continues to rebound, the next target will be the 200-day SMA at 1.0789, followed by the weekly high of 1.0852 (June 12) and the June peak of 1.0916 (June 4). Breaking through this level could expose the March high of 1.0981 (March 8), before reaching the weekly high of 1.0998 (January 11) and the key psychological level of 1.1000.

On the downside, if bears take control, the pair might first revisit the June low of 1.0667 (June 14), then the May low of 1.0649 (May 1), and finally the 2024 low of 1.0601 (April 16). The 4-hour chart has shown some signs of renewed weakness, with initial resistance at 1.0761, followed by 1.0805 and 1.0852. Initial support is at 1.0667, followed by 1.0649 and 1.0601. The Relative Strength Index (RSI) has stabilized around 43.

USDJPY

Prediction: Decrease

Fundamental Analysis:

The USD/JPY pair remains strong at $159.73 but has yet to break through the $160 mark. Several high-ranking Japanese officials have threatened to intervene, leading to increased speculation about a potential surprise interest rate hike in Japan in July. This speculation has made the market closely monitor Japan's economic indicators, putting pressure on further USD/JPY buying. After a weak performance in the first quarter of 2024 and disappointing economic indicators in the second quarter, the impact of the yen's devaluation on the economy is becoming a key focus.

Technical Analysis:

The USD/JPY is currently hovering above the 50-day and 200-day EMAs, signaling a bullish trend. If USD/JPY returns to $160 and reaches the April 29 high of $160.209, it might push higher towards $161. Conversely, if USD/JPY falls below $158, it could initiate a bearish move towards the 50-day moving average. Dropping below this moving average could indicate a decline towards the support level of $151.685. The 14-day RSI is at 68.46, suggesting that USD/JPY might reach the April 29 high of $160.209 before entering the overbought zone.

BTCUSD

Prediction: Increase

Fundamental Analysis:

Bitcoin recently dipped below the $60,000 mark for the first time since early May, triggering a broad sell-off across cryptocurrency markets. However, on June 25th, Bitcoin experienced a notable recovery, climbing over 3% to reach $61,916.60. This rebound coincided with positive movements in Nvidia and the Nasdaq Composite Index, both recovering from their recent lows in April.

The cryptocurrency market's sensitivity to broader stock market trends was evident, with potential sell-offs possibly driven by market sentiment and the need to meet margin calls. The absence of fundamental triggers suggests that market sentiment plays a significant role in crypto asset volatility during stock market downturns.

Technical Analysis:

From a technical perspective, analysts emphasize the critical support levels around $60,000 for Bitcoin's market sentiment. The $55,000 to $58,000 range, including the pivotal 200-day moving average at $57,500, serves as important indicators for potential risk management and readiness for significant price movements. Investors are advised to monitor these levels closely for insights into future market dynamics.

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