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GBP/USD Falls as Robust US Data Dull Fed Rate Cut Expectations, Sterling Weakens Despite Supportive UK Jobs Data

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  • July 17, 2025
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GBP/USD currency pair fell to 1.3408 in the North American session as better-than-forecasted American economic news boosted the demand for the Dollar and squashed expectations of a soon Federal Reserve rate cut. U.S. unemployment claims dropped to 221K, while retail sales in June increased by 0.6%, both better than predicted and supporting the Fed’s reluctance to ease policy. Hawkish remarks from Fed Governor Adriana Kugler contributed to the Dollar’s strength. The UK labor market cooled but not as swiftly as anticipated, providing little encouragement for the Pound. Consequently, Sterling continued to underperform amidst conflicting economic indicators and central bank forecasts. KEY LOOKOUTS • Improved-than-expected jobless claims and retail sales figures favor the US Dollar and lower the chances of a Fed rate cut in the short term. • Hawkish comments from Fed Governor Adriana Kugler indicate interest rates could stay constant despite inflationary fears, particularly from tariffs. • The UK’s more sluggish-than-anticipated cooling in its labor market did not offer sterling any meaningful support, which left GBP/USD vulnerable. • GBP/USD is heading towards crucial support levels at 1.3373, with more downside potential towards 1.3300 and the 100-day SMA of 1.3278 if negative momentum persists. The GBP/USD currency pair was subjected to fresh selling pressure after the release of a robust set of U.S. economic data, which provided added impetus to the Federal Reserve’s dovish stance on cutting interest rates. With unemployment claims declining to 221K and retail sales increasing 0.6% in June, the numbers hinted at ongoing economic strength in the U.S., further pushing up the Greenback to new monthly highs. Fed Governor Adriana Kugler’s dovish comments further bolstered the Dollar as she highlighted maintaining rates at current levels in the face of tariff-driven inflation. Conversely, the UK labor market only moderately indicated a slowdown, which was not enough to prop up the Pound, and GBP/USD continued trading around weekly lows at the 1.3400 level. GBP/USD fell to 1.3408 as impressive U.S. jobless claims and retail sales figures boosted the Greenback and dampened rate cut speculation. Aggressive Fed commentary put additional pressure on Sterling, as it struggled even with a relatively resilient UK labor release. • GBP/USD went down to 1.3408 after robust US data boosted the Dollar in the North American session. • US Jobless Claims fell to 221K, better than the predicted 235K, indicating a healthy employment scenario. • June Retail Sales climbed 0.6%, much greater than the predicted 0.1%, bolstering economic strength. • Fed Governor Kugler indicated no hurry to reduce rates, pointing to inflationary pressures and firm jobs. • UK labor data showed slower-than-expected cooling, with the Claimant Count Change at 25.9K. • Sterling remained pressured, unable to gain momentum despite less negative domestic data. • Technical bias remains neutral-to-bearish, with key support at 1.3373 and resistance near the 50-day SMA at 1.3500. The GBP/USD exchange rate reacted to the latest round of economic data, with the U.S. Dollar strengthens after strong performance in jobless claims and retail spending. The initial jobless claims fell more than anticipated, and consumer expenditure witnessed strong growth during June—both indicators that the U.S. economy is still strong. These occurrences, combined with the recent inflation numbers, led investors to re-evaluate the chances of the Federal Reserve cutting interest rates any time soon. Fed Governor Adriana Kugler echoed this view by asserting that monetary policy is likely to stay stable for the time being considering continued price pressures. GBP/USD DAILY PRICE CHART SOURCE: TradingView The UK labor market statistics, on the other hand, presented a moderate level of strength, where there was a less-than-anticipated increase in unemployment benefit claims. Nonetheless, the British Pound had little support since broader market sentiment was positive towards the Dollar. Political clarity within the U.S. also came into play, with fears surrounding Fed Chair Jerome Powell’s employment status being dismissed by President Trump, taking away one layer of uncertainty. Focus now turns to forthcoming central bank commentary as well as other economic data that can shape currency interactions between the Pound and the Dollar. TECHNICAL ANALYSIS GBP/USD has a neutral-to-bearish bias since it is trading close to the lower boundary of its recent range at 1.3400. The Relative Strength Index (RSI) shows persistent bearish momentum that implies that sellers are still in charge notwithstanding sporadic buying interest. To turn the outlook bullish, the pair would have to retake the 50-day Simple Moving Average (SMA) at 1.3500. Failing that may create room for further losses, with short-term support at 1.3373 followed by the psychological level of 1.3300 and the 100-day SMA at 1.3278. FORECAST On the other hand, in case of increased bullish momentum, GBP/USD may try to recover towards the 1.3485 level, which was the recent two-day high. A breakout above this resistance could set the stage for a challenge of the 50-day SMA near 1.3500, a key level that may confirm a change in short-term sentiment. Continued advances above this area could prompt additional gains toward 1.3570 and possibly 1.3620, if further supporting UK data or dovish turns from the Fed favor the Pound. On the negative side, sustained Dollar strength and tight Fed policy expectations could drive GBP/USD below near-term support at 1.3373. A breakdown below here would risk further losses down to the 1.3300 psychological level. Should selling continue, the pair could fall further down to the 100-day SMA at 1.3278, with further downside targets at 1.3200 not precluded in a bearish environment.

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Currencies EUR/USD

EUR/USD Falls Below 1.1800 as US Dollar Strengthens on Robust Job Figures and Powell’s Cautious Note

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  • July 2, 2025
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EUR/USD currency pair is further falling below the 1.1800 mark as the US Dollar strengthens on the back of solid economic data and a cautious note from Federal Reserve Chairman Jerome Powell. A steep increase in US JOLTS Job Openings and higher-than-anticipated ISM Manufacturing PMI data have restored investor sentiment in the US economy, upholding the Greenback. On the other hand, dovish comments from European Central Bank (ECB) officials and a surprise rise in Eurozone unemployment have dragged the Euro lower. With markets looking forward to the ADP Employment Change and Nonfarm Payrolls news, bearish technical indicators indicate more downside risk for EUR/USD. KEY LOOKOUTS • Markets are waiting for the ADP Employment Change report for June, due to report a 95K increase in jobs, and which will determine the tone before Thursday’s Nonfarm Payrolls. • Investors will be watching ECB President Christine Lagarde’s comments at the Sintra Summit closely for any new policy indications with creeping Eurozone unemployment. • EUR/USD is gaining more bearish momentum on the 1-hour chart, with a Head & Shoulders setup looking to target support at 1.1690–1.1650. • Robust US data and Powell’s conservative “wait-and-see” stance remain in favor of the USD, lowering short-term rate cut prospects. EUR/USD currency pair is bearish as the US Dollar strengthens on the back of a robust set of economic data and conservative statements by Federal Reserve Chairman Jerome Powell. After briefly recovering above 1.1800, the Euro has turned back, buried by the surprise increase in Eurozone unemployment and dovish rhetoric from ECB officials. Conversely, the US labor market remains resilient, with both JOLTS Job Openings and ISM Manufacturing PMI beating forecasts. While markets shift their attention to the next big events such as the ADP Employment Change and ECB President Lagarde speech, bearish technical indications point toward potential further EUR/USD decline. EUR/USD extends losses as the US Dollar strengthens on positive job data and Powell’s dovish attitude. Higher Eurozone unemployment and dovish ECB news increase pressure on the Euro. Markets now look to the ADP Employment report and Lagarde’s speech for new direction. • EUR/USD trades below 1.1800, reversing from recent multi-year highs at 1.1830. • US Dollar gathers strength on positive JOLTS Job Openings and ISM Manufacturing PMI data. • Fed Chair Jerome Powell is also conservative in tone, stressing a “wait-and-see” stance on rate cuts. • Eurozone unemployment rose unexpectedly to 6.3%, weighing on the Euro. • Dovish statements by officials such as Rehn and Centeno on the ECB suggest possible further easing. • Bearish Head & Shoulders formation on the EUR/USD 1-hour chart directs the focus toward a decline to 1.1690–1.1650. • Attention turns to next US ADP report and ECB President Lagarde’s speech for further guidance. The EUR/USD currency pair is under renewed bearish pressure with economic divergence between the Eurozone and the United States being increasingly highlighted. The Euro is negatively influenced by a surprise increase in Eurozone unemployment to 6.3%, in addition to dovish comments from European Central Bank officials who remain worried about chronically low inflation. While German production figures revealed some relief and Eurozone CPI flattened, these were not enough to boost sentiment due to investors’ expectations of a more conservative ECB policy course in the near term. EUR/USD DAILY PRICE CHART SOURCE: TradingView In contrast, the US Dollar is strengthening on recent figures that reinforce the solidity of the US economy. Solid job opportunities and a recovery in the ISM Manufacturing PMI have been timed with Federal Reserve Chairman Jerome Powell’s dovishness at the ECB Forum in Sintra, where he invoked caution to follow data closely prior to making any policy action. With strong labor market data and steadfast inflation indications, the Fed is likely to stay patient on rate cuts, providing the USD with a steady tailwind. Focus then shifts to the ADP Employment report and Nonfarm Payrolls, which may offer more insight into the outlook for the US economy. TECHNICAL ANALYSIS EUR/USD is seen gathering bearish momentum following its inability to hold above the 1.1800 mark. The pair has broken below the Head & Shoulders neckline on the 1-hour chart and is now poised for a trend reversal. The Relative Strength Index (RSI) is falling lower into negative ground, supporting the bearish view. A confirmed decline below Tuesday’s low at 1.1760 would leave the door open toward the pattern’s measured target at 1.1690. Below that, focal support is between Tuesday’s June 27 low at 1.1680 and Monday’s June 26 low at 1.1650. On the positive side, there is resistance at 1.1810 and 1.1830 and stronger resistance at 1.1850 indicated by the 261.8% Fibonacci extension. FORECAST Should EUR/USD be able to stay above the 1.1760 level and recover bullish strength, the pair may try to retest the 1.1800 psychological level. A break above 1.1810 and sustained would reveal the recent high at 1.1830. Additional bullish pressure may drive the pair to the 1.1850 resistance, indicated by the 261.8% Fibonacci extension of the June 26–30 rally. A positive change in Eurozone fundamentals or dovish US labor statistics can serve as a catalyst for higher highs. On the negative, inability to hold the 1.1760 support would speed the bearish correction. Breaking below this level would affirm the Head & Shoulders formation and aim for the next significant support at 1.1690. Ongoing pressure selling might take EUR/USD towards the 1.1680–1.1650 region, where buyers might intervene to stabilize the pair. Poor Eurozone economic data or better-than-anticipated US labor statistics would tend to strengthen the downward path.

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Commodities Gold

Gold Under Pressure: Hawkish Fed Weighs on XAU/USD Despite Geopolitical and Trade Uncertainties

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  • June 20, 2025
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Gold prices continue to trade under selling pressure and are on the cusp of weekly losses, powered largely by the Federal Reserve’s hawkish pause and the stronger US Dollar. Even while backed by supportive drivers like elevated geopolitical tensions in the Middle East and existing trade uncertainties—notably regarding U.S. tariff threats—safe-haven demand for gold has been unable to muster much potency. Although these risks might cap further downside, technicals indicate the possibility of a more severe correction unless there is robust dip-buying. General market sentiment remains cautious as investors balance meager rate cut hopes against rising global risks. KEY LOOKOUTS • The Federal Reserve’s inflation hawk and diminished expectations for rate reductions continue to underpin the US Dollar and put gold prices under pressure. • Increased Iran-Israel conflict, with potential U.S. intervention, would rekindle demand for the gold safe-haven. • Threatened U.S. tariffs, especially in the pharma space, and Trump’s “liberation day” deadline of July 9 can cause market volatility. • Monitor significant support levels around $3,323-$3,322 and resistance around $3,375 and $3,400 for short-term directional indications. Gold prices continue to be underpinned as the Federal Reserve’s hawkish bias supports the US Dollar and reduces the attractiveness of the non-yielding yellow metal. Nevertheless, geopolitical tension in the Middle East and anticipated trade uncertainties, especially surrounding future U.S. tariffs, are helping support gold’s safe-haven appeal. Investors are sitting on the sidelines, weighing scant rate cut hopes against the threat of an escalation of broader conflict in the region. The technical picture also leaves the way open for further decline unless major support levels trigger fresh buying interest. Gold lingers under pressure from a hawkish Fed and firm US Dollar, on course for weekly losses. Geopolitical tensions and trade uncertainty should cap downside, but technical pressure remains. • Gold price under strain from Federal Reserve’s hawkish pause. • US Dollar strengthens, diminishing demand for non-yielding assets such as gold. • Iran-Israel geopolitical tensions boost safe-haven demand. • Trade uncertainty rises ahead of the July 9 deadline for U.S. tariffs. • Fed forecasts two rate cuts by the end of 2025, capping gold potential. • Technicals signal further downside to the $3,300 support level. • Resistance at $3,375 and $3,400, with a possible retest of the $3,451 high if mood changes. Gold prices remain under pressure following the Federal Reserve’s hawkish tone that has supported the US Dollar’s strength. Although the Fed kept interest rates unchanged, it indicated reduced rate cuts in the future, that dulled investor demand for non-yielding assets such as gold. Such a policy sentiment has outshined some market-friendly factors such as persistent geopolitical tensions and trade uncertainties and has held gold on a weaker path during the week. XAU/USD DAILY PRICE CHART SOURCE: TradingView Concurrently, increasing world risks are providing a counterweight to bearishness. Mounting tensions in the Middle East between Iran and Israel have raised regional stability fears, which could attract investor interest back to safe-haven assets. Furthermore, threatened U.S. tariffs and trade policy changes under the Trump administration are introducing new uncertainty into the markets. These considerations may inspire hedge positioning by investors, as the wider risk environment remains extremely fluid. TECHNICAL ANALYSIS XAU/USD has fallen below the 100-period Simple Moving Average (SMA), which indicates short-term weakness. The price is moving towards significant support close to the lower edge of a short-term uptrend channel, at about the $3,323–$3,322 region. Momentum indicators on the daily chart are weakening, while on hourly charts there is increasing bearish momentum, indicating the possibility of further falls. On the other hand, initial resistance is evident at $3,374–$3,375, followed by $3,400; a prolonged break above this level may lead to a retest of the recent high of around $3,451. FORECAST If geopolitical tensions do not abate and trade uncertainties further increase, gold will likely recapture its safe-haven status, driving fresh purchasing interest. The sustained break above the $3,375 resistance level would then pave the way for a rise towards the $3,400 psychological mark. Should bullish momentum continue to gather pace, the price would revisit the recent high of $3,451, and even target the all-time high of $3,500 in the near future. On the negative side, sustained strength in the US Dollar driven by the Federal Reserve’s hawkish policy can continue to put pressure on gold. A break below the $3,323–$3,322 support zone could trigger intensified selling, driving prices towards the $3,300 level. If bearishness persists, the metal can move into a further correction phase, especially if risk mood improves and rate cut hopes are confined.

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Commodities Gold

Gold Prices Drop Below $3,250 on US-China Trade Deal and Bullish USD Sentiment

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  • May 12, 2025
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Gold prices have fallen sharply below the $3,250 mark as bullish sentiment on the US-China trade deal and a stronger US dollar negatively impact the precious metal. The pact between the two nations to cut tariffs significantly has improved global risk sentiment, causing investors to move away from safe-haven assets such as gold. In the meantime, soothing US recession concerns and the Federal Reserve’s aggressive interest rate hawkishness have also continued to prop up the dollar, further weighing on gold prices. With market focus now shifting to future US inflation readings and Fed Chairman Jerome Powell’s testimony, traders are expecting further gold declines, particularly if the price breaks below crucial support levels. KEY LOOKOUTS • The release of the next US inflation numbers later this week will be closely watched, as they may affect market expectations for future Federal Reserve action, specifically on interest rates, that would impact the outlook for gold. • Powell’s on-stage appearance on Thursday may further clarify the Fed’s thoughts on rate cuts, potentially sparking yet more US dollar strength and prolonging bear pressure on gold. • The long-term implications of the US-China tariff reduction agreement will also influence global risk sentiment in the future. If tensions in trade continue to ease, demand for safe-haven assets such as gold may still be muted. • Be on the lookout for price breakdowns below the $3,250 level, especially around the $3,200 level, which can serve as a point for more losses. Alternatively, a bounce above $3,300 may point towards potential short-covering and price reversal. With gold prices still falling below the $3,250 threshold, a number of influential factors are at play. The new US-China trade deal, which constitutes a substantial lowering of tariffs, has supported risk appetite at the international level, encouraging investors to move away from safe-haven instruments such as gold. This combined with the Federal Reserve’s aggressive approach to raising interest rates and the strength of the US dollar has further put pressure on the precious metal. Traders are now waiting for significant events, such as the publication of US inflation data and statements by Fed Chair Jerome Powell, which may offer key information about the future trajectory of both gold and the dollar. Furthermore, technical levels near $3,200 are still pivotal, with a break of this support potentially causing further falls for gold. Gold prices are under stress, declining below $3,250 due to optimism for the US-China trade deal and a stronger dollar dulling the appetite for the metal. Gold’s near-term direction will probably be determined by significant market events, such as US inflation numbers and Fed Chairman Jerome Powell’s upcoming remarks. •  Gold prices have declined below the level of $3,250, a major fall in the market. •  The US-China trade tariff cut accord has enhanced overall risk sentiment worldwide, dampening the demand for safe-haven assets such as gold. •  Optimism over the trade agreement and the Federal Reserve hawkish pause has been favorable for the US dollar, placing added pressure on gold prices. •  Positive developments in the trade front have succeeded in tempering fears over the possibility of a US recession, further diminishing gold’s attractiveness. •  The $3,200 level is still a key support level for gold, and any breakdown below it could trigger further losses. •  Traders are looking forward to US inflation data releases that could shape expectations of future Fed rate hikes and affect gold prices. •  We will be looking for any new signals in Powell’s testimony that could give direction for both the US dollar and gold in terms of future monetary policy. Gold prices have remained under pressure with prices dipping below the $3,250 benchmark as market sentiments change following news of a development in the US-China trade discussions. The easing of tariffs among the two nations has triggered sentiments in global markets, promoting the risk-on position that reduces appetite for safe-haven assets such as gold. As investors disengage from risk-off positions, the price of gold has continued to decline, noticeably. XAU/USD DAILY PRICE CHART CHART SOURCE: TradingView Apart from the trade agreement, the US dollar has picked up strength as recession concerns eased and the Federal Reserve maintained its hawkish interest rate stance, which weighed further on the price of gold. The market now awaits major economic events, including the announcement of US inflation figures and comments from Federal Reserve Chairman Jerome Powell, that can shape investor sentiment and potentially give fresh direction to the precious metal in the days to come. TECHNICAL ANALYSIS Gold prices have slid below $3,250, led primarily by a spike in optimism over the US-China trade deal, which has given global risk sentiment a boost. The tariff-cutting accord between the two countries has prompted investors to shift away from safe-haven investments such as gold, directing attention to risk-sensitive investments. Moreover, the solidifying US dollar, bolstered by declining recession fears and the hawkish tone at the Federal Reserve regarding interest rates, has also dented gold’s attraction. While markets wait for major economic reports, such as US inflation figures and remarks by Fed Chair Jerome Powell, the future of gold is uncertain. FORECAST Gold prices may recover somewhat if the market responds to any surprise negative economic data or geopolitical tensions that revive demand for safe-haven assets. Furthermore, if inflation readings come in higher than anticipated or if Fed Chairman Jerome Powell indicates a more dovish approach to interest rates, it may soften the US dollar and boost gold’s upside. Gold could also draw support if investor sentiment shifts toward caution again, especially if trade negotiations between the US and China breakdown or face some setbacks. To the downside, gold may suffer additional pressure if the US-China trade deal optimism continues to underpin global risk-on sentiment. A firmer US dollar, boosted by the Federal Reserve’s hawkish bias and upbeat economic data, can provide additional pressures to gold’s decline. If inflation figures indicate stabilization and the Fed holds its aggressive stance on interest rates, the allure of gold might decrease further still, with

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Currencies USD/JPY

USD/JPY Rally Extends Amid US-China Trade Deal Hopes and Fed’s Hawkish Tone, Targeting 145.00 Level

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  • May 8, 2025
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Japanese Yen (JPY) continues to come under pressure due to hopes over a US-China trade deal and the hawkish tone of the Federal Reserve driving the USD/JPY pair higher, with the pair near the 145.00 level. In spite of the Fed’s rate pause cues, the USD remains supported by the continued hopes for trade deals fueled by US President Trump’s statement about the announcement of a big deal. While the Bank of Japan (BoJ) provides cues about prospective interest rate increases in 2025, the global economic risks, especially about the US tariffs, may cap firmer JPY losses. Technical indicators are indicating further upside in USD/JPY, with levels to keep an eye on at 144.00 and 145.00. KEY LOOKOUTS • The USD/JPY currency pair is moving up as a result of optimism over a US-China trade agreement and the Federal Reserve’s policy of maintaining rates unchanged, which indicates support for the US Dollar. • The minutes of the BoJ indicate possible future interest rate increases in 2025, although global uncertainty and economic unpredictability will constrain the Japanese Yen’s losses. • President Trump’s statements on a significant trade deal announcement also increase investor optimism in the US Dollar, supporting JPY’s underperformance as a safe-haven currency. • The duo is set to test the 145.00 psychological level, with major technical resistance at 144.00 and support levels near 143.40, which affect market mood and price action. USD/JPY pair maintains its rally, supported by a mix of US trade agreement optimism and the hawkish bias of the Federal Reserve, which supports US Dollar confidence. President Trump’s recent remarks over a big announcement of a trade deal have even further added fuel to anticipation, boosting the USD against the Japanese Yen. The Bank of Japan has even threatened to hike interest rates in 2025 but with worldwide economic uncertainties surrounding the tariffs imposed by the US having checked the ascent of the Yen. Consequently, the duo is getting close to the 145.00 level, with technical charts indicating that resistance at 144.00 and support at 143.40 will be the key determinants of the next direction. USD/JPY pair keeps on moving upwards, fueled by US trade deal optimism and a dovish Fed attitude. Although the Bank of Japan hints at future rate rises later in 2025, global uncertainties continue to put pressure on the Japanese Yen, taking the pair towards the 145.00 level. •  Optimism over US-China trade discussions increases investor confidence, favoring the US Dollar relative to the Japanese Yen. • The Fed’s hold on interest rates has supported the US Dollar, which has helped its strength against safe-haven currencies such as the Yen. • In spite of worldwide economic uncertainty, the Bank of Japan indicates that it can increase interest rates in 2025, curbing further losses for the Yen. • President Trump’s words regarding a significant trade deal announcement later today further support USD sentiment, pressuring the Yen. • Continuous uncertainty stemming from US tariffs and geopolitical unrest, including the Russia-Ukraine crisis, dents the safe-haven value of the Yen. • The pair is close to crucial resistance at 145.00, with levels of support at 143.40 and 143.00 probably shaping subsequent price action. • Traders expect President Trump’s press conference to offer fresh cues on the course of US trade policy and impact the overall market mood. USD/JPY currency pair is picking up speed, spurred on by increasing hope surrounding US-China trade negotiations and the recent dovish tilt in Federal Reserve monetary policy. Supportive comments by President Trump on a big trade deal announcement due later today again boosted confidence in the US Dollar, as global economic volatility remains a source of concern that keeps the Japanese Yen on the back foot. The expectation of a possible US trade agreement and the Fed’s choice to wait before lowering rates have helped push the US Dollar higher, which has undermined the safe-haven status of the Yen. USD/JPY DAILY PRICE CHART CHART SOURCE: TradingView At the same time, the Bank of Japan (BoJ) is also cautious but indicates that it might hike interest rates in 2025 if inflationary trends persist. In spite of these possible plans to tighten, the BoJ remains wary of global economic uncertainty, notably regarding US trade policy. Consequently, the potential for the Yen to recover is subdued, notably as the US Dollar remains buoyed by optimism over trade deals and general market sentiment. Traders are following events closely, which influence the current direction in USD/JPY. TECHNICAL ANALYSIS USD/JPY currency pair is now probing major resistance levels near the 144.00 level, and has the potential to move past 145.00, which is a psychological level. The 200-period Simple Moving Average (SMA) on the 4-hour chart is still a key metric to monitor, as it has acted as a resistance level in the past. If the pair is able to break above 144.30, it may lead to a rally up to the 145.00 level and further to 146.00. On the other hand, the immediate support areas are around 143.40-143.35, and a break below these levels would likely send the pair to the 142.35-142.00 region. These technical considerations, in addition to overall market sentiment, will most probably dictate the near-term direction of USD/JPY. FORECAST USD/JPY pair is expected to continue its bullish trend, particularly if the pair successfully crossed the 144.30 resistance level. A prolonged movement above this level may set the stage towards the psychological 145.00 level, a key level to watch for traders. If the US Dollar continues to be strong on sustained optimism regarding US trade agreements and the hawkish policy of the Federal Reserve, USD/JPY may continue its rally, possibly testing levels around 146.00 in the near future. Momentum indicators also indicate that if the pair continues to be bullish, it may move higher, driven by investor optimism regarding the US economy and declining global risk concerns. Conversely, if the pair is rejected around the 144.00-144.30 levels and cannot stay above these levels, a corrective retrace might ensue. Levels of support around 143.40-143.35 are

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Commodities Gold

Gold Staggers Despite Growing Appetite for Risk and Strengthening USD, but Bets on Fed Rate Cut Provide Comfort

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  • May 1, 2025
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Gold prices are now down for a third day in a row, having plunged to a two-week low, as a stronger US Dollar and better risk appetite—fuelled by a reduction in US-China tensions and positive trade rhetoric—tarnish the demand for the safe-haven metal. But the drawback looks limited as disappointing US macroeconomic data, such as a surprise GDP decline and lower inflation readings, drive expectations for dovish Federal Reserve rate cuts. These expectations, in turn, limit USD appreciation and give gold a cushion. Investors now look to important US economic reports, such as the ISM Manufacturing PMI and Friday’s Nonfarm Payrolls, for more definitive guidance on the Fed’s policy course and gold’s next direction. KEY LOOKOUTS •  Focus in the market is on ISM Manufacturing PMI and Friday’s Nonfarm Payrolls (NFP) report, which may have a major impact on the Fed’s interest rate trajectory and gold’s direction. •  Federal Reserve Rate Cut Expectations: Lower GDP and softening inflation add to expectations of a 100 basis point rate cut by year-end, which may cap USD strength and prop up gold prices. •  Geopolitical Updates: Any strengthening of geopolitical tensions, especially including Russia or US-China relations, might reactivate safe-haven demand for gold. •  Technical Levels under Scrutiny: A confirmed breakdown below the $3,229–$3,228 support level could trigger further downtrends towards $3,200 and $3,160, while attempts to recover are repelled at $3,260–$3,265 and $3,300. Multiple important factors that can influence the metal’s short-term direction are being closely observed by gold traders. All attention is now focused on forthcoming US economic data, especially the ISM Manufacturing PMI and the critical Nonfarm Payrolls report, which may impact hopes surrounding the Federal Reserve’s interest rate decisions. Softer inflation and a shock GDP contraction earlier have already fueled market expectations for deep rate cuts, potentially curbing additional gains for the USD and underpinning gold. Geopolitical threats, particularly escalating tensions between Russia and events in US-China relations, also continue to be in the spotlight as possible drivers of safe-haven flows. Technically, a persistent breakdown below the $3,229–$3,228 support area could pave the way for further losses, while resistance around $3,265 and $3,300 could limit attempts at recovery. Gold’s short-term prospects are contingent upon pivotal US data releases, specifically the Nonfarm Payrolls release, and shifting Fed rate cut expectations. Geopolitical uncertainty and USD strength will also be influential, with technical support at $3,229 continuing to be paramount for direction of price. • Gold prices are under pressure, near a two-week low due to firmer USD and risk-friendly sentiment. •  US-China trade optimism and easing tensions are lifting investor sentiment, lowering demand for safe-haven assets such as gold. •  US Dollar strength is suppressing gold, underpinned by positive sentiment and hawkish comments. •  Soft US macro data—such as a surprise contraction in GDP and weaker inflation—are fueling hopes of aggressive Fed rate cuts. •  Markets now expect as much as 100 basis points of rate cuts by the Federal Reserve through year-end, which could top USD gains and underpin gold. •  Geopolitical tensions, such as rising tensions in Eastern Europe, could give a safety bid and cap gold’s downside. •  Key technical levels to monitor are support at $3,229 and resistance at $3,265–$3,300, which will determine short-term price action. Gold still wanders through a geopolitical and macroeconomic maze, where market sentiment is influenced by a mix of economic instability and changing international dynamics. The recent relaxation of US-China tensions and upbeat trade talks have heightened investor optimism, limiting the attractiveness of conventional safe-haven assets such as gold. At the same time, improved US Dollar performance with supportive comments about international trade agreements has dampened demand for gold. This notwithstanding, gold is being underpinned by increasing fear about the US economy’s health, as demonstrated by a surprising GDP contraction and decelerating private sector hiring. XAU/USD Daily Price Chart Sources: TradingView Inflationary pressure also seems to be abating, with the most recent information indicating a deceleration in both headline and core inflation. These events have reinforced market expectations of further aggressive interest rate reductions by the Federal Reserve over the next few months. As market players adjust strategies to meet new economic data and central bank cues, gold still has some underlying support. At the same time, lingering geopolitical tensions, particularly relating to Russia and Eastern Europe, continue to introduce uncertainty that can maintain interest in the precious metal as a long-term hedge. TECHNICAL ANALYSIS Gold recently fell below the crucial support range of $3,265–$3,260, prompting a cascade of selling pressure and driving prices to a two-week low of $3,221. Although momentum indicators have begun to lose bullish momentum, a clear break below the next significant support at $3,229–$3,228 (50% Fibonacci retracement) would affirm a bearish continuation towards the $3,200 level and potentially the $3,160 zone. On the upside, any recovery attempts may face resistance near the $3,260–$3,265 zone, followed by stronger barriers around the $3,300 mark and the $3,348–$3,350 supply region, where renewed selling interest could emerge. FORECAST If upcoming US economic data, particularly the Nonfarm Payrolls report, reinforces expectations of Federal Reserve rate cuts, gold could find renewed support and begin to recover. A softer labor market or softer inflation numbers can heighten pressure on the Fed to cut policy, softening the US Dollar and making non-yielding assets such as gold more attractive. Gold prices in such a case can recover towards the $3,300 mark and even retest higher resistance levels if risk-off sentiment returns owing to geopolitical tensions or global economic issues. On the other hand, in case the US economic data surprise positively—indicating resilience in the labor market or more sticky inflation—market expectations of Fed rate cuts diminish, a stronger USD results, and gold comes under additional downward pressure. Continued absence of safe-haven demand on account of bettering risk sentiment, particularly following positive global trade updates, could also be responsible for further losses. If gold falls below the $3,229 support level decisively, it may lead to a deeper correction towards $3,200 and even the $3,160 region in

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Currencies EUR/USD

EUR/USD Under Pressure Amid US Dollar Rebound and Poor Eurozone Economic Figures

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  • April 23, 2025
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EUR/USD recently saw a pullback, temporarily falling below 1.1400 as the US Dollar rallied, driven by President Trump’s remarks on the independence of the Federal Reserve and his hopes for hitting a trade agreement with China. This followed a period of volatility on concerns over tariffs and the Fed’s interest rate plans. At the same time, the Euro came under pressure from soft Eurozone economic indicators, with the April PMI showing weak growth, especially in the services sector. With market players expecting possible ECB rate reductions, the short-term direction of the EUR/USD pair is unclear, as the US Dollar is already displaying signs of regaining its safe-haven appeal. KEY LOOKOUTS • The US Dollar has picked up steam after President Trump’s assurances regarding the independence of the Fed and his positive sentiments on US-China trade negotiations. Market players will be looking for updates in these fronts to assess the sustainability of the Dollar’s recovery. • Poor PMI readings in the Eurozone, specifically a decline in the services sector, indicate the struggles of the region’s economic growth. Investors will watch closely for future economic statistics to determine if this trend persists. • Increasing speculation that the European Central Bank (ECB) might make further interest rate cuts in June could negatively impact the Euro. Words from ECB officials, especially President Christine Lagarde, will be crucial to determining the central bank’s future action. • The EUR/USD pair is resisted at the important 1.1600 level, and 1.1276 is a pivotal support area. Traders need to monitor these levels for possible price action that might determine the next direction for the pair. EUR/USD has come under downward pressure lately, falling below 1.1400 as the US Dollar gained strength after President Trump’s words of comfort to the market regarding the Federal Reserve’s independence and his optimistic view on US-China trade negotiations. The Euro has fared poorly, burdened by soft Eurozone PMI readings, especially a decline in the services sector, which indicated slowing economic growth in the region. Also, rising hopes that the European Central Bank (ECB) will reduce interest rates further in June have contributed to the weakness of the Euro. While the market weighs these factors, EUR/USD is in a precarious balance, with important resistance at 1.1600 and support at 1.1276. EUR/USD recently broke below 1.1400, as the US Dollar appreciated following President Trump’s remarks about the Fed and US-China trade negotiations. However, soft Eurozone PMI data and anticipations of future ECB rate reductions are weakening the Euro, making the currency pair remain in cautious territory. • EUR/USD fell as the US Dollar rallied, driven by President Trump’s assurance regarding the Federal Reserve’s autonomy and positive trade discussion news with China. • The April PMI data from the Eurozone showed poor economic growth, with a decline in the service sector, putting pressure on the Euro. •  Trump showed optimism that the US and China would come to a trade agreement, mitigating some of the tariff-related uncertainty that had previously weighed on the market. • Trump also signaled frustration with the Fed’s decision not to lower interest rates, injecting volatility into the market’s view of US monetary policy. • Heightened expectations that the European Central Bank will cut interest rates again in June are putting pressure on the Euro. • EUR/USD is resisted at the 1.1600 level, with support at the July 2023 high of 1.1276. • Investors are hesitant as they wait for additional economic data from both the US and Eurozone to determine the trend of the EUR/USD pair. EUR/USD pair has recently seen a change in momentum, mainly as a result of events in the US economy and trade negotiations. President Trump’s words of support for the Federal Reserve’s independence and optimism regarding a possible trade agreement with China have given the US Dollar a boost. His assurances have eased market fears over the Fed’s policies, specifically concerns that he would attempt to oust Chairman Jerome Powell. This has given the US Dollar an added attractiveness as investors regained confidence in its stability. EUR/USD DAILY PRICE CHART CHART SOURCE: TradingView Conversely, the Eurozone is suffering from economic issues, with low PMI numbers indicating that the region’s growth is decelerating, especially in the services sector. The possibility of additional rate cuts by the European Central Bank has also contributed to doubts regarding the strength of the Euro. With low inflation expectations and economic activity in the doldrums, the Euro is facing pressure as investors expect further policy measures by the ECB. These factors have placed the EUR/USD pair in a precarious balance, with the US Dollar picking up steam and the Euro struggling to keep its footing amidst regional economic strife. TECHNICAL ANALYSIS EUR/USD has run into resistance at the 1.1600 level, which has halted its recent upward movement. The pair dipped briefly below 1.1400, signaling a correction after touching a three-year high of 1.1575. The 14-week Relative Strength Index (RSI) has spiked above the 70.00 mark, indicating strong bullish pressure but also hinting at potential correction in the near future. Support for the pair is at the July 2023 high of 1.1276, and a strong dip below this point may indicate further downward potential. While the pair remains in this vicinity, the key levels will be eyed by traders for probable breakout or reversal trades. FORECAST If the US Dollar continues to exhibit strength, especially in view of additional favorable news in trade talks or optimism regarding the policies of the Fed, EUR/USD may remain under pressure. But if the Eurozone can stabilize its economic situation and the ECB does not make additional drastic rate cuts, there is some hope for the pair to turn around. A breach above the 1.1600 resistance would be an indication of a change in direction, with further increases to higher levels possible. A boost in stronger economic numbers or fiscal stimulus plans in the Eurozone could also support the Euro to some extent, aiding its recovery. EUR/USD stands at risk of further declines in case the

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Currencies GBP/USD

GBP/USD Price Prediction: Dollar Rises as GBP Is Affected by Inflation and BoE Rate Reduction Pressure

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  • April 17, 2025
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The GBP/USD currency pair has experienced a breather from its recent rally, pulling back to approximately 1.3230 from a high of 1.3300 in six months. Favorable news regarding US-Japan trade negotiations has boosted the US Dollar, while disappointing inflation readings in the UK have fueled expectations for possible interest rate reductions by the Bank of England. In spite of the pullback, the short-term GBP/USD outlook is bullish, with all short-to-long Exponential Moving Averages (EMAs) moving upwards and robust bullish momentum signaled by the 14-day Relative Strength Index (RSI). A breakout above 1.3292 may propel the pair to higher levels, but a fall below 1.3164 may initiate further drops. KEY LOOKOUTS •  The positive development in US-Japan trade negotiations has brought relief to the US Dollar, which has recovered and witnessed bids. The US Dollar Index (DXY) moving up towards 99.50 may add further pressure on GBP/USD in the short run. •  UK’s soft inflation figures, especially in services, and a bleak jobs market outlook are raising hopes that the Bank of England will choose to cut interest rates, which could press down on the Pound. • The GBP/USD currency pair is in a general uptrend with the support of rising Exponential Moving Averages (EMAs) and a robust V-shape recovery in the 14-day RSI, indicating that the pair may continue to rise if it surmounts recent highs. • Look for possible price reaction at 1.3292 (April 16 high) for a potential shift to 1.3430 and 1.3500. Alternatively, a fall below 1.3164 (April 15 low) may extend the decline, with 1.3063 and the psychological 1.3000 mark serving as major support. GBP/USD pair is facing a brief slowdown in its rally, retreating to near 1.3230 after hitting a six-month peak of 1.3300. This pullback is against the backdrop of firming US Dollar demand, fueled by upbeat news in US-Japan trade negotiations, which has assisted the US Dollar in its recovery. In contrast, weak UK inflation data and a less rosy labor market forecast have fueled hopes of possible interest rate reductions by the Bank of England, which may put further pressure on the Pound. This notwithstanding, the short-term GBP/USD outlook is bullish, with the rising Exponential Moving Averages (EMAs) and a robust bounce in the 14-day RSI pointing to the possibility of the pair reversing its downward bias and returning to upward traction should it reclaim above the 1.3292 level. But a fall below 1.3164 will stimulate further downside action, with 1.3063 and 1.3000 being crucial supports. GBP/USD has pulled back to 1.3230 from a high of 1.3300, as the US Dollar gains strength due to favorable US-Japan trade talks. Soft UK inflation figures and hopes of Bank of England rate cuts weigh on the Pound, although the short-term outlook remains bullish if the pair is able to break above 1.3292. • The GBP/USD pair pulled back to 1.3230 from a six-month high of 1.3300, indicating a halt in the recent rally. •  The US Dollar has benefited as US-Japan trade negotiations improved, sending the US Dollar Index (DXY) to close to 99.50. •  UK inflation data, particularly in the services sector, has raised hopes for possible interest rate reductions by the Bank of England. •  The dismal UK labor market forecast, coupled with tepid inflation, increases the chances of the Bank of England relaxing its monetary policy to spur the economy. •  In spite of the retreat, the overall GBP/USD outlook is bullish, with the Exponential Moving Averages (EMAs) rising and hinting at further bullish momentum. •  The 14-day Relative Strength Index (RSI) has made a V-shaped recovery, which indicates that bullish momentum may continue. •  A move above 1.3292 may take GBP/USD to higher levels such as 1.3430 and 1.3500, and a fall below 1.3164 may take it lower with 1.3063 and 1.3000 being support levels. The GBP/USD currency pair has seen a pullback from its recent six-month high of 1.3300, falling back to 1.3230 as the US Dollar strengthens. This Greenback strength is largely due to favorable news in US-Japan trade talks, which have eased fears over global economic uncertainty. The US Dollar Index (DXY) has also recovered to the vicinity of 99.50, which represents the increasing confidence that the US is moving away from intensifying trade tensions. Investors are more confident now that the US will concentrate on bilateral deals instead of pursuing additional trade wars, thereby providing the US Dollar with a strong support. GBP/USD DAILY PRICE CHART CHART SOURCE: TradingView While that, the Pound Sterling continues under pressure as gentle inflation numbers in the UK have teased hopes of interest rate reductions by the Bank of England. The UK services sector inflation eased to 4.7% in March from 5% in February, which may encourage the Bank of England to unwind its monetary policy to fuel growth in the economy. Additionally, a challenging labor market outlook suggests that UK employers may reduce hiring, further impacting the strength of the Pound. Despite these challenges, the overall sentiment for GBP/USD remains cautiously positive, as the pair has shown resilience, supported by market expectations of future upside potential. TECHNICAL ANALYSIS GBP/USD remains in an overall bullish trend, supported by rising Exponential Moving Averages (EMAs) across various timeframes, indicating upward momentum. The 14-day Relative Strength Index (RSI) has exhibited a V-shaped bounce, going from 40.00 up to almost 70.00, indicating strong buying pressure and sustained bullish momentum. The critical technical levels to monitor are 1.3292, the April 16 high, which would trigger further appreciation towards 1.3430 and 1.3500 if broken. On the negative side, a drop below 1.3164 (the April 15 low) might initiate a retracement to 1.3063 and the psychological barrier of 1.3000, where support is likely to be found. In general, the technical indicators suggest a cautiously positive near-term scenario for the pair. FORECAST GBP/USD pair might renew its bullish trajectory if it can break over the recent high of 1.3292 on April 16. Breaking above that mark would set the pair up to move higher, potentially toward the

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AUD/USD Currencies

AUD/USD Slumps Close to 0.6300 in Face of Growing Risk Aversion and US Tariff Fears

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  • March 21, 2025
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The AUD/USD has fallen towards the 0.6300 level as risk aversion increases following increased concerns regarding US tariff policy, increasing the demand for safe-haven currencies like the US Dollar. The Australian Dollar is still on the back foot due to soft domestic jobs data, which is making traders revalue the Reserve Bank of Australia’s monetary policy perspective. As US bond yields fall as investors flock to Treasuries for safety, Fed Chair Jerome Powell conceded the difficulty in assessing the wider inflationary effects of tariffs even as he minimized their near-term impact. Cautious market sentiment prevails as economic uncertainties and changing central bank expectations remain at the helm of currency fluctuations. KEY LOOKOUTS • Safe-haven demand for the US Dollar could continue to weigh on AUD/USD amidst increasing geopolitical and economic uncertainty. • Market players closely monitor RBA’s policy, with lower jobs data fuelling speculation over possible rate reductions in the months ahead. • Future US releases of data, particularly inflation and employment, will be pivotal to influencing Fed policy expectations and USD direction. • Any intensification of US tariff news or overall risk sentiment would further fuel volatility and influence AUD/USD direction. The AUD/USD is still closely watched as several factors have been guiding its path. Increasing US Dollar demand amid surging risks aversion and US tariff policy concerns continues to press the key Australia Dollar. Meanwhile, weak Australian labor market statistics have prompted traders to re-evaluate the Reserve Bank of Australia’s policy tone, raising speculation of future rate cuts. Market players are also eyeing future US economic data, which might further affect Federal Reserve expectations and currency fluctuations. Changes in global sentiment or intensification of tensions relating to trade might contribute to volatility in the pair. AUD/USD remains around 0.6300 due to safe-haven demand pushing the US Dollar higher in light of increasing US tariff tensions. Downbeat Australian jobs data adds to the pressure, stoking speculation regarding future RBA rate cuts. Markets now look for major US economic indicators for guidance. • AUD/USD is trading around 0.6300, pressured by increasing risk aversion and increased US Dollar demand. • Safe-haven flows support USD, fueled by US tariff policy concerns and worldwide economic uncertainty. • US bond yields fall as investors turn to Treasuries for safety amid market and geopolitical uncertainty. • Fed Chair Powell minimizes inflation effect of tariffs, but admits difficulty in measuring broader economic impacts. • US Initial Jobless Claims increased to 223K, narrowly missing forecasts and contributing to risk-averse market sentiment. • Australian Dollar weakens after disappointing jobs data raise the alarm over the health of the labor market. • RBA policy outlook questioned, with markets speculating over future rate cuts despite the central bank’s conservatism. The Australian Dollar is facing pressure as global market sentiment shifts towards caution with increasing worries over US trade policies. Investors are now betting on the US Dollar as a safe-haven currency as anxiety rises about future economic shocks resulting from new tariffs from the US. This greater risk-aversion is fuelling currency market direction, and market participants watch closely for events in geopolitics and policy communications by large economies. Financial markets are more in defensive mood today, propelling demand towards defensive assets and impacting currency prices internationally. AUD/USD Daily Price Chart Chart Source: TradingView To this conservative mood comes the additional news of weaker-than-forecast employment figures from Australia. The unemployment rate having held steady, the fall in overall employment created renewed doubts about the vigor of the nation’s labor market. Consequently, market players are reviewing again the Reserve Bank of Australia’s policy path and more speculation about additional scope for cutting interest rates. Yet, the central bank has been cautious in tone, hinting at a cautious and data-driven policy in the next few months. TECHNICAL ANALYSIS AUD/USD is still under sustained bearish pressure, trading around the important psychological support level of 0.6300. The pair still trades below important moving averages, showing a consistent downtrend. Momentum indicators like the Relative Strength Index (RSI) also indicate a bearish bias, but not yet oversold, with scope for further decline. Any decisive break below 0.6300 could take the pair deeper into support levels, while any recovery attempt could be resisted around the 0.6350–0.6380 area. Traders are likely to observe these levels closely for possible breakout or reversal signals. FORECAST If sentiment in the market picks up and risk appetite comes back, AUD/USD may recover modestly. A recovery in global equities or a relief on US tariff concerns might dampen the safe-haven bid for the US Dollar, providing some relief to the Australian Dollar. Any surprise upside in Australian economic data or a more dovish tone from the Reserve Bank of Australia (RBA) could also induce a short-term rebound. In this case, the duo might try to retest resistance levels of 0.6350 and possibly 0.6380 if bullish sentiment gathers pace. On the bearish side, ongoing risk aversion and lingering worries about global trade tensions might keep AUD/USD under selling pressure. A strong US Dollar, supported by safe-haven flows and robust US economic data, might push the pair below the pivotal 0.6300 level. If this support is convincingly violated, subsequent falls toward 0.6250 or even 0.6200 cannot be discounted. Further, any subsequent indications of weakness in the labor market of Australia or dovish rhetoric from the RBA would bolster the bearish outlook for the Australian Dollar in the near term.

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AUD/USD Currencies

Australian Dollar Falters as US Dollar Strength and Rising Global Tensions Intensify

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  • March 18, 2025
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The Australian Dollar (AUD) continues to struggle as the US Dollar (USD) strengthens on the back of rising geopolitical tensions and poor US economic data. Heightened fears of Middle East conflicts, possible trade disruptions, and aggressive US tariff policies by President Donald Trump have shaken global markets, lifting safe-haven demand for the USD. While the Reserve Bank of Australia (RBA) remains optimistic about cuts in interest rates in the future, providing some boost to the AUD, stimulus measures by China provide some cushioning for the Aussie Dollar. Although trade anxieties on the horizon and softer US retail data remain dampeners for investor moods. KEY LOOKOUTS • Increasing Middle East tensions and assertive US policy measures continue to drive safe-haven demand for the US Dollar, exerting downward pressure on the Australian Dollar. • The Reserve Bank of Australia’s reluctance to cut interest rates could give the AUD temporary support, depending on inflation patterns and world economic conditions. • Optimism from China’s consumption-stimulating measures could be a boon to the AUD, considering Australia’s robust trade relations with China. • The AUD/USD currency pair can test the crucial resistance level of 0.6408. A break can reach 0.6480, and strong support is found at 0.6330 and 0.6311. The Australian Dollar (AUD) is under a challenging trading scenario with increasing geopolitical tensions and the US Dollar (USD) strengthening, bolstered by safe-haven demand and threats of tariffs from the Trump administration. Though soft US economic data, including disappointing retail sales and weakening consumer sentiment, put a cloud of uncertainty over the outlook for the USD, the AUD is under pressure from worries of global trade dislocation and Australia’s exposure to commodity markets. Nevertheless, the Reserve Bank of Australia’s prudent stance on cutting interest rates and China’s recent stimulus package targeting consumption provide some glimmer of support for the Aussie. Technical levels indicate a possible bullish shift in the AUD/USD, but future upside will rely on global risk appetite and core economic events ahead. The Australian Dollar is still pressured as the US Dollar consolidates its gains on renewed geopolitical tension and uncertainty about trade. Yet, prudent RBA policy and China’s economic stimulus offer support. Market attention now turns to significant technical levels and prospective economic indicators. • The Australian Dollar weakens as geopolitical tensions drive demand for the safe-haven US Dollar. • RBA Assistant Governor Sarah Hunter gives a nod towards cautiousness with future rate cuts. • Dismal US Retail Sales and weaker consumer sentiment place pressure on the USD outlook. • US President Trump’s proposed reciprocal tariffs and no exemption for steel and aluminum affect Australia’s trade outlook. • China’s specific action plan to stimulate consumption provides regional market assistance, supporting the Aussie Dollar. • AUD/USD is traded around 0.6380, with possibilities to test the resistance at 0.6408 and trend towards 0.6480. • The investors are careful as the ongoing global economic and political events are still driving currencies. The Australian Dollar is under pressure as geopolitical tensions rise, especially in the Middle East, where the US has reasserted its military presence. The increased global uncertainty has fueled demand for the US Dollar, which is commonly regarded as a safe-haven asset during periods of crisis. Concurrently, economic issues in the US, including soft retail sales and a precipitous decline in consumer sentiment, have created an additional layer of sophistication in overall market sentiment. Though these contribute to market volatility, the general global backdrop still plays a role in currency movements, including the AUD. AUD/USD Daily Price Chart Chart Source: TradingView Domestically, the Reserve Bank of Australia (RBA) has adopted a conservative view regarding future interest rate reductions, hinting at a more prudent strategy than what the markets had predicted. This occurs as Australia’s trade environment is also under threat from the US administration’s refusal to remove tariffs on Australian steel and aluminum exports. But recent Chinese efforts to trigger its economy—like increasing household consumption and stabilizing markets—provide a glimmer of hope for Australia’s economy, considering China’s vital position as an important trading partner. TECHNICAL ANALYSIS AUD/USD pair still has a bullish tilt as it still moves in an upward channel in the daily chart. The currency pair is presently trading close to 0.6380, and the impetus is buoyed by the 14-day Relative Strength Index (RSI) being sustained above the 50 level, which shows strength on the buy side. In case the pair continues to go higher, it could try and test the new high close to 0.6408. However, levels of support close to 0.6330 and 0.6311 are pivotal; a break below these might spell a change in trend and usher in more downward pressure. FORECAST If sentiment in the market is bullish and geopolitical tensions between nations become less, the Australian Dollar may recover strength, provided that China’s economic stimulus initiatives begin to yield more positive results. Increased stability globally, along with a prudent but consistent monetary policy by the Reserve Bank of Australia, could be a basis for AUD recovery. Moreover, if future US economic data continues to underperform, it may devalue the US Dollar and lend support to a bullish trend in the AUD/USD currency pair. Strong commodity demand and positive risk appetite can further drive the Aussie higher in the short term. On the bearish side, the Australian Dollar is exposed to sustained geopolitical tensions and escalating global uncertainties, especially with regards to US trade policies and military aggressions. Continued resilience of the US Dollar, fueled by safe-haven flows and possible policy changes by the Federal Reserve, may put further pressure on the AUD. Additionally, if the recovery in China slows down or Australia continues to encounter more trade-related issues, the AUD might not be able to gain strength, making a decline in the AUD/USD pair more likely. 

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