EUR/USD Forecast: Trade Tensions and Tariffs Push Euro Lower
XAU/USD
Prediction: Increase
Gold has experienced a slight correction but is currently showing signs of short-term recovery, driven by concerns over trade wars and inflation. While the USD remains strong, gold could maintain its upward momentum if economic and political uncertainties persist.
FUNDAMENTAL ANALYSIS
Impact of Trump's Tariff Policies
● Trump's tariffs on Canada, Mexico, and China continue to be a major factor affecting the gold market.
● Tariffs may lead to inflation and increased instability, boosting demand for gold as a safe-haven asset.
Impact on the Gold Market
● Gold remains bullish in the medium and long term due to concerns over trade war escalation and inflation.
● However, a strong USD and high interest rates may limit gold’s upside potential if these conditions persist.
Overall Market Outlook
● Despite recent corrections, macroeconomic factors continue to support gold prices.
● If gold breaks key resistance levels, we could see a stronger recovery.
TECHNICAL ANALYSIS
Key Resistance Levels
● $2,800 - $2,817: A strong resistance zone from previous highs; a breakout above this level would confirm the uptrend.
● $2,850: A higher resistance level, potentially the next target if gold sustains its recovery.
Key Support Levels
● $2,700: The first support level; holding above this level could establish a short-term bottom.
● $2,650 - $2,600: A breakdown below this range could trigger strong selling pressure, pushing prices lower.
Technical Indicators
● RSI: Currently at 50, indicating a neutral market—neither overbought nor oversold. This suggests that gold’s next move will depend on macroeconomic developments.
● EMA (34, 89, 200): Levels are $2,772.31, $2,740.68, and $2,704.91, respectively. EMAs are gradually indicating an uptrend, but further confirmation is needed.
● Trading Volume: Stable, suggesting continued investor interest and market participation in gold.
EUR/USD
Prediction: Decrease
The EUR/USD pair is under strong pressure from President Donald Trump’s tariff decisions, as he has imposed tariffs on imports from Mexico, Canada, and China. These moves have strengthened the USD while pushing the euro lower.
Currently, EUR/USD has dropped to 1.02246, and macroeconomic factors continue to weigh on the market.
FUNDAMENTAL ANALYSIS
Impact of Trump’s Tariff Policies
● Trump has implemented a 25% tariff on goods from Canada and Mexico and a 10% tariff on Chinese imports.
● Canada and Mexico have retaliated immediately, while China is expected to challenge the decision at the WTO.
● These actions may increase trade costs, strengthen the USD, and weaken the euro further.
Impact on ECB Monetary Policy
● If tariffs drive up inflation, the ECB may avoid cutting interest rates as expected, creating further monetary policy divergence between the ECB and the Fed, adding pressure on the euro.
Market Sentiment & Investor Reactions
● The market is reacting strongly to tariff news, and concerns over global trade tensions could push the euro lower in the short term.
Macroeconomic Outlook & Global Trade Strategy
● Trade tensions may disrupt supply chains and slow global economic recovery, further weighing on the euro.
TECHNICAL ANALYSIS
Key Resistance Levels
● 1.0300 - 1.0350: A strong resistance zone from previous highs. If EUR/USD breaks above this level, a recovery could be confirmed.
● 1.0500: A critical resistance level; breaking above it could open room for further upside.
Key Support Levels
● 1.0100: The main support level; if broken, EUR/USD could drop further toward 1.0000.
● 1.0000: A psychological level; a break below this could accelerate further declines.
Technical Indicators
● RSI: Currently at 26, indicating that EUR/USD is in oversold territory and may find short-term support.
● EMA (34, 89, 200): Currently at 1.03921, 1.03878, and 1.04091, respectively. The price is below all these levels, confirming a dominant downtrend.
● Trading Volume: Has surged during recent sell-offs, reflecting strong selling pressure. EUR/USD remains bearish in the short term, but if RSI stays in oversold territory and reversal signals emerge, the pair could see a short-term rebound. However, the overall downtrend remains intact, and traders should closely monitor key support levels.
BTC/USD
Prediction: Downtrend
The cryptocurrency market has witnessed over $1.7 billion in liquidations in the past 24 hours after President Donald Trump announced new tariffs on imports from Canada, Mexico, and China. This has heightened concerns over inflation and the Federal Reserve’s (Fed) interest rate policies, causing Bitcoin to drop 7.5% to $91,530.
FUNDAMENTAL ANALYSIS
Impact of Trump’s Tariff Policies
● Trump announced a 25% tariff on Canadian and Mexican goods, along with a 10% tariff on Chinese imports.
● Canada retaliated with a 25% counter-tariff, and Mexico and China may take similar actions.
● This could trigger a new "trade war", increasing import costs and indirectly fueling inflation.
Impact on Fed’s Monetary Policy
● If tariffs drive inflation higher, the Fed may maintain higher interest rates for longer, limiting the growth of risk assets like Bitcoin.
● Hank Huang, CEO of Kronos Research, warned that market fears of delayed rate cuts by the Fed could weigh on crypto markets.
Market Sentiment & Position Liquidations
● Coinglass data shows over 450,000 traders liquidated, totaling $1.79 billion in losses.
● Long positions accounted for the majority of liquidations ($1.57 billion), suggesting that overconfident buyers were wiped out as BTC dropped.
● The GMCI 30 Index, which tracks the top 30 cryptocurrencies, plunged 24.3% in 24 hours.
Bitcoin ETF Inflows
● Despite the market crash, Bitcoin ETFs continue attracting strong capital inflows.
● In January 2025 alone, Bitcoin ETFs have absorbed $4.94 billion, indicating sustained institutional interest.
● If ETF inflows remain steady, this could support BTC’s recovery in the mid-term.
Regulatory & Policy Developments
● Utah may become the first U.S. state to establish a Bitcoin reserve, pushing government-level crypto adoption.
● However, Trump has not signaled support for cryptocurrencies, leading to reduced optimism among Bitcoin investors.
TECHNICAL ANALYSIS
Key Resistance Levels
● $95,000 - $96,500: A strong resistance zone from previous highs. Breaking above this level could confirm a bullish reversal.
● $100,000: A psychological level; if BTC reclaims this, it may signal a long-term uptrend.
Key Support Levels
● $90,000: First support level; holding above this could establish a short-term bottom.
● $88,500 - $87,000: A break below this zone could intensify selling pressure, potentially driving BTC to $85,000 or lower.
Technical Indicators
● RSI: 20, indicating that BTC is oversold and may soon find a short-term bottom.
● EMA (34, 89, 200): At $101,343, $101,961, and $100,565, respectively. BTC is currently at $93,700, trading below all EMAs, confirming that the downtrend remains dominant.
● Trading Volume: Spiked sharply during the recent sell-off, reflecting strong selling pressure from the market.
BTC/USD remains bearish in the short term, but the oversold RSI and ETF inflows suggest potential stabilization and recovery in the mid-term. However, macroeconomic risks and Fed policy remain key factors to watch.
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