EUR/USD: Bearish Momentum Continues as USD Strengthens
XAU/USD
Prediction: Increase
Fundamental Analysis:
Gold prices saw a sudden drop of more than $10 in the Asian market, falling to around $2,674 per ounce, continuing the decline from the previous trading day. This drop followed an increase in U.S. Treasury yields after Trump’s victory in the U.S. presidential election, which increased pressure on gold. Trump's win has bolstered the U.S. dollar, and the market expects the Federal Reserve to take a less "dovish" stance, making rate cuts less likely.
Some of Trump's proposed policies, seen as potentially inflationary, could force the Fed to reconsider its strategies for managing inflation. Initial market reactions suggest that Trump's policies could drive U.S. economic growth, making it more challenging for the Fed to control inflation.
Technical Analysis:
On the 60-minute chart, gold is trading within a downward channel. However, the 14-hour Relative Strength Index (RSI) indicates there is still room for further decline before reaching oversold conditions. Sellers might push prices down to $2,667 or even $2,648. On the other hand, buyers may look to take profits if prices rebound to around $2,707 or higher, potentially reaching $2,720. On the daily chart, gold has broken out from an upward trend channel, and the 14-day RSI signals a bearish outlook. Sellers might target a drop to $2,608, or even as low as $2,500, while buyers may aim for profits at around $2,785 or higher.
USD/JPY
Prediction: Increase
Fundamental Analysis:
Yuichiro Tamaki, leader of Japan’s Democratic Party for the People, warned that Trump’s protectionist policies could put additional downward pressure on the yen. Meanwhile, the US Dollar Index (DXY) is attempting to rise above the 104.00 level. After the Fed cut interest rates by 0.25% to 4.50%-4.75%, signaling continued easing, the dollar rose, but some traders reversed positions due to concerns over Trump's trade policies.
Technical Analysis:
The USD/JPY pair has pulled back to a key support level on a major trendline around $152.55. A break above the November 7 high of $154.71 could signal the continuation of the uptrend, pushing toward resistance at $155.24. If the price breaks above that level, it could target $157.86. On the downside, if the price falls below the trendline and drops beneath $151.29, a short-term trend reversal could occur, with support at $150.15 from the 100-day Simple Moving Average (SMA).
EUR/USD
Prediction: Decrease
Fundamental Analysis:
The EUR/USD pair faces pressure as the U.S. dollar strengthens, with political uncertainties in Germany also weighing on the euro. Investors expect the Federal Reserve to adopt a more cautious stance due to Trump’s likely push for higher tariffs and lower corporate taxes, which could drive inflation. If these policies are enacted, the Fed may tighten monetary policy, strengthening the U.S. dollar and putting additional pressure on the euro.
Technical Analysis:
The EUR/USD pair has resumed its decline after a brief recovery. The 20-day and 50-day Exponential Moving Averages (EMAs) are moving downward around $1.0860 and $1.0920, indicating bearish momentum. The 14-day RSI is near 40.00, and a drop below this level would reinforce the bearish trend. Resistance for euro buyers is around $1.0800, while the pair could potentially drop to its year-to-date low near $1.0600.
BTC/USD
Prediction: Decrease
Fundamental Analysis:
Bitcoin surged to an all-time high of $81,499 due to the "Trump Trade" effect. Investors are optimistic that a Trump presidency could ease cryptocurrency regulations, boosting market confidence. However, uncertainty remains regarding how much Trump will influence cryptocurrency legislation if he returns to office. Though a Trump-led government may favor cryptocurrencies more than the current administration, any significant policy changes could take time.
Technical Analysis:
Bitcoin hit a record high of $81,358, showing strong upward momentum and positive market sentiment, with the Crypto Fear and Greed Index in the "Extreme Greed" zone. This surge follows Trump’s win in the U.S. presidential election, which has boosted optimism in the cryptocurrency market. However, there may be concerns that this rally could be overextended in the short term, potentially leading to a pullback.
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