From a long-term perspective, a wave C formation can be expected, with its low positioned below the low of wave A. At present, it is difficult to believe in such a substantial decline of the euro, but the first quarter of 2026 demonstrated that geopolitical developments can dramatically alter market trends.

On a lower time frame, I can identify a classic five-wave bearish structure. Once this structure is complete, the pair may transition into a new upward wave sequence, and at this stage the bearish structure appears complete. Therefore, a rise in the euro can be expected from the 1.1513 level, which corresponds to the 76.4% Fibonacci retracement level.

However, without support from geopolitical developments and the ECB, any appreciation of the euro is likely to face significant difficulties.

The EUR/USD pair gained 40 points on Tuesday, responding to a reduction in geopolitical tensions in the Middle East. Today, markets learned that Israel and Iran, with mediation from Donald Trump, had agreed to cease military operations. The U.S. president also stated that a deal with Iran would be signed within the next two weeks and that the United States would achieve a complete victory over its adversary.

Trump further claimed that Iran is highly interested in reaching an agreement with the United States and is prepared to surrender its nuclear weapons. All that remains is to wait for the next round of denials from Tehran.

It should be remembered that this is far from the first time Donald Trump has promised—or even declared—a complete victory over Iran. Frankly speaking, it remains unclear whether the United States has already achieved victory or is still preparing to do so.

The nuclear issue also remains unclear. Senior Iranian officials, including Abbas Araghchi and Mojtaba Khamenei, have repeatedly stated that the nuclear issue is not even part of the current negotiations and that Iran's abandonment of uranium enrichment is impossible.

I can assume that Tehran might agree to a nuclear deal similar to the one that existed in 2015. However, no such proposal is currently being offered. Trump is demanding the removal of all enriched uranium from Iran, an end to any future enrichment activities, and the closure of nuclear facilities.

I may be mistaken, but it seems to me that markets have once again received a fresh dose of misinformation from the White House.

It should also be remembered that Trump has already promised approximately twenty times that a peace agreement with Iran would be signed "within the next few days." At times, it resembles a form of neuro-linguistic programming. The impression is that by repeating the same message over and over again, Trump hopes to convince the world—and Iran in particular—that a deal is inevitable.

Whether this strategy will prove successful remains uncertain, but so far it has produced few tangible results. Nevertheless, the market appears to appreciate the U.S. president's optimism.

Today, demand for the U.S. dollar weakened as geopolitical risks declined.

Conclusions

Based on my EUR/USD analysis, I conclude that the pair remains within a broader upward trend segment (shown in the lower chart), while in the shorter term it remains within a downward trend segment that may already be complete.

In my view, the current environment offers a reasonable opportunity to consider building long positions. The failed attempt to break below 1.1513, which corresponds to the 76.4% Fibonacci retracement level, combined with the completed appearance of the bearish trend segment, suggests that the pair may transition into a new upward wave sequence with targets near the 1.1700 level and above.

On the higher time frame, an upward trend segment remains visible, followed by the formation of a corrective wave structure. In the near future, wave C is expected to develop with targets around 1.1352, corresponding to the 38.2% Fibonacci retracement level.

Once the A-B-C corrective structure is complete, a new long-term bullish trend may begin.

Core Principles of My Analysis

1. Wave structures should be simple and easy to interpret. Complex structures are difficult to trade and often undergo revisions.
2. If there is no confidence in the market situation, it is better to stay out of the market.
3. There can never be absolute certainty regarding price direction. Always use protective Stop Loss orders.
4. Wave analysis can be combined with other forms of analysis and trading strategies.

The GBP/USD pair has an excellent opportunity to continue its decline after reacting to bearish Imbalance 19 following two weeks of trading within it. However, the situation is not as straightforward as it may seem.

Following Friday's decline triggered by the Nonfarm Payrolls report, a new bearish Imbalance 20 was formed. Today, price has completely filled this imbalance, and at the current pace of bullish pressure, it may soon be invalidated. If that happens, the bearish move will be interrupted before it has even properly begun.

Once again, traders will be reminded of how quickly conditions can change both in the currency market and in the Middle East. Today, the market sold the U.S. dollar, apparently in response to renewed optimistic comments from Donald Trump regarding a potential resolution of the conflict, as well as reports of a ceasefire between Israel and Iran.

It is difficult to determine who in the market is still willing to believe that an agreement between Tehran and Washington is imminent. Military actions between Israel and Iran could resume just as quickly as they stopped. Therefore, the coming weeks are likely to bring numerous geopolitical reversals in price action.

If Imbalance 20 is invalidated, no active trading pattern will remain. I would like to remind traders that opening positions from an area of interest requires more than simply a reaction from that zone—a valid signal must form within it. In other words, a sell signal inside Imbalance 20 may never materialize.

Overall, the situation surrounding the Middle East conflict is better than it was a few months ago when the parties were engaged in full-scale military confrontation. Nevertheless, the pendulum can swing in the opposite direction at any moment.

Over the past several weeks, we have witnessed numerous potential escalations in the Middle East, and only the reluctance of both sides to resume large-scale military operations has prevented the conflict from reigniting.

In my view, the broader trend remains bullish despite the pair's significant declines this year. The ceasefire in the Middle East remains fragile, but it is still in place and may be extended for another 60 days.

However, the Strait of Hormuz remains effectively blocked from both sides, the nuclear issue remains unresolved, and any assessment of progress in negotiations is based largely on statements from Donald Trump. Iran continues to present a very different interpretation of the situation.

Conditions continue to shift between improvement and deterioration. For now, the market retains some confidence that an agreement can eventually be reached, but that confidence is not unlimited.

The current technical picture is as follows. Bullish Imbalance 18 generated a valid price reaction, while Imbalance 19 eventually produced a sell signal. However, only two days after that signal appeared, bullish rather than bearish pressure emerged.

The reason is that the geopolitical backdrop has shifted once again. As a result, technical patterns continue to trigger frequent reversals, while traders often struggle to react quickly enough to rapidly changing developments.

There was no significant economic news on Tuesday. Market participants reacted positively to Trump's latest promises to reopen the Strait of Hormuz and thereby reduce oil prices, although in my opinion these promises have little connection to reality.

Nevertheless, Iran and Israel have suspended military operations, which is certainly a positive development. The situation remains unstable and highly unpredictable.

The broader fundamental backdrop still leads me to expect continued long-term weakness in the U.S. dollar. Even the conflict involving Iran and the United States changes little in that regard.

Geopolitical developments temporarily reminded investors of the dollar's safe-haven status for roughly two months, but the overall environment for the U.S. currency remains unfavorable.

If the U.S. economy gains momentum in 2026, the Federal Reserve resumes its monetary tightening cycle, and tensions between the United States and Iran evolve into a prolonged conflict, then the dollar could realistically target the 1.3100–1.3000 level against the pound.

However, in my view, the long-term outlook for the U.S. dollar could not have fundamentally changed because of a single strong Nonfarm Payrolls report, and the Federal Reserve has not yet signaled any readiness to tighten monetary policy.

Economic Calendar for the United States and the United Kingdom

• United States – Consumer Price Index (12:30 UTC).

The economic calendar for June 10 contains one event, but it is an important one. The economic backdrop may have a noticeable impact on market sentiment during the second half of Wednesday's trading session.

GBP/USD Forecast and Trading Recommendations

The long-term outlook for the British pound remains bullish, although the most recently formed signal is a sell signal. Therefore, in the near term, provided that geopolitical developments do not interfere, bears may continue their advance toward the lows of May 18 and March 31. Liquidity could be taken from those swing lows, after which, if geopolitical conditions improve, bulls may regain control and resume the upward trend. At present, it is difficult to imagine a quick resolution to the conflict involving Iran and the United States, which limits the pound's upside potential. At the same time, the dollar repeatedly loses momentum as occasional positive developments continue to emerge from the Middle East.

The EUR/USD pair spent two weeks trading within Imbalance 13, attempting to form a buy signal inside this zone. However, bulls failed to find sufficient grounds for a new advance, and Friday's Nonfarm Payrolls report dealt a significant blow to bullish sentiment. The pair fell well below Imbalance 13, invalidating this pattern.

The only remaining signal is the one formed within Imbalance 15, but it is a bearish signal within a trend that is still considered bullish. Last Friday, a new bearish Imbalance 16 was formed, and prices may react to it as early as today.

However, it should be emphasized once again that bearish signals are forming within a bullish trend that cannot yet be considered complete. Moreover, under current conditions, any chart signal or pattern should be treated with caution, as geopolitical developments are capable of invalidating virtually any technical setup.

Earlier today, Donald Trump once again stated that the conflict with Iran could be resolved within the coming weeks and that the parties may reach a mutually beneficial agreement. In addition, Iran and Israel have halted mutual attacks, which is undoubtedly a step toward broader de-escalation. These two developments were the primary drivers behind EUR/USD's rise on Tuesday.

However, tomorrow Iran could resume attacks against Israel or the United States, or announce that no progress has been made in negotiations. In that case, the U.S. dollar could strengthen once again.

The objective reality is that the conflict in the Middle East is far from resolved, while Tehran and Washington remain unable to agree on terms that would satisfy all parties. On Monday, Iran carried out its first strikes against Israel in two months in response to an Israeli attack on Beirut, once again putting negotiations and a potential peace agreement at risk.

Such developments are no longer surprising, as the parties involved in the conflict continue to exchange strikes on a regular basis. At times, they appear more concerned with avoiding any appearance of weakness than with preserving the negotiation process. As a result, the U.S. dollar continues to benefit from geopolitical support.

In the near term, both price action and market sentiment will remain heavily dependent on geopolitical developments. If Tehran and Washington ultimately sign a memorandum of understanding, extend the ceasefire, and make progress on the nuclear issue, bears may be forced to retreat, allowing the euro and pound to resume their upward movement.

However, the situation remains highly fluid, forcing both bulls and bears to repeatedly adjust their positions.

Under current conditions, traders may consider bearish patterns. A new sell signal within bearish Imbalance 16 could emerge as early as today. Nevertheless, if an agreement between Iran and the United States is eventually reached, the euro could resume its advance despite the presence of bearish patterns.

Market sentiment continues to shift back and forth, forcing traders to adapt their strategies accordingly.

It is worth emphasizing once again that the U.S. dollar's rally between January and March was driven primarily by geopolitical factors. As soon as the United States and Iran reached a ceasefire agreement, bearish pressure on EUR/USD eased, and bulls dominated trading for more than a month.

At present, the likelihood of a broader agreement appears to be declining again, while the market remains highly skeptical of reports suggesting an imminent resolution to the conflict or a comprehensive agreement between Iran and the United States. Consequently, geopolitical developments continue to exert background pressure on EUR/USD.

The economic calendar was not responsible for Tuesday's rise in the euro. Earlier in the day, Germany released trade balance and industrial production reports, which delivered mixed results. The reasons behind the dollar's decline have already been discussed above.

Tomorrow, market participants will assess the inflation report, which could once again alter trader sentiment.

Bulls still have numerous arguments in their favor in 2026, and the conflict in the Middle East has not materially reduced them. From both a structural and long-term perspective, Trump's policies—which contributed to the significant decline of the U.S. dollar last year—remain largely unchanged.

In the coming months, the U.S. dollar may occasionally strengthen amid periods of risk aversion. However, this factor requires a continued escalation of tensions in the Middle East. I still do not believe in the emergence of a sustained bearish trend for EUR/USD. The dollar has received temporary support from the market, but it remains unclear what factors could provide bears with a durable long-term advantage.

Economic Calendar for the United States and the Eurozone

• United States – Consumer Price Index (12:30 UTC).

The economic calendar for June 10 contains only one event, but it is an important one. The economic backdrop may influence market sentiment during the second half of Wednesday's trading session.

EUR/USD Forecast and Trading Recommendations

In my view, the pair remains in the process of forming a bullish trend. The information backdrop changed sharply three months ago, but the broader trend cannot yet be considered canceled or completed.

Therefore, bulls may well resume their advance in the near future if geopolitical developments provide even modest support.

At present, traders can maintain short positions initiated from Imbalance 15 while waiting for a new sell signal from Imbalance 16. The pair's decline has persisted for objective reasons. Without the strong U.S. labor market and unemployment data, the support zone represented by Imbalance 13 would most likely have held.

However, that support failed, giving bears an opportunity to extend their advance. The key question now is whether geopolitical developments will allow them to do so.

As reported today, representatives of the US administration will hold a special meeting with law?enforcement agencies to discuss contentious provisions of the bill. The sticking point is a developer?protection clause for blockchain protocol creators, modeled on the Blockchain Regulatory Certainty Act. Law enforcement officials fear this provision would effectively create legal shields for those building infrastructure that could be used to launder money and conduct other illicit financial activities. Several Democrats have already said they will not support the bill until these concerns are resolved. Given that the CLARITY Act needs bipartisan votes to pass the Senate, the defection of even a few Democrats would lead to a deadlock.

Experts say the new dispute over developer protections is not a technicality but a fundamental ideological clash. The crypto industry argues that a protocol developer should not be held responsible for how third parties use their code — much like a knife maker is not responsible for crimes committed with a knife. Law enforcement counters that blockchain's anonymity and decentralization create a fundamentally different situation, where a protocol developer effectively builds infrastructure for shadow financial flows — which is no longer an abstract knife but a ready tool to bypass AML controls.

Recall that yesterday more than 200 crypto firms — including Coinbase, Kraken, a16z, Uniswap Labs and the Solana Foundation — sent a letter to the Senate urging that the developer-protection clause be preserved unchanged.

The new obstacle has arisen at the worst possible time. Only a few working weeks remain before Congress's August recess, and the Senate calendar is overloaded with budget negotiations and other priority bills. Now, on top of the political and procedural hurdles, there is a substantive — and weighty — objection from the law-enforcement community.

Trading recommendations

Bitcoin

Buyers are now targeting a return to $63,600, which would open the path to $65,800, and from there to $67,700 — a break above which would signal attempts to restore a bull market. On the downside, buyers are expected at $61,100; a drop below that could quickly push BTC toward $59,600. The next downside target would be around $58,200.

Ethereum

A clear close above $1,724 would open the way to $1,783. A further target is the high near $1,838; a break above that would indicate strengthening bullish sentiment and renewed buyer interest. On the downside, buyers are expected at $1,645; a return below that level could quickly push ETH toward $1,563. The further downside target would be $1,476.

What's on the chart

• The red lines represent support and resistance levels, where the price is expected to either pause or react sharply.
• The green line shows the 50-day moving average.
• The blue line is the 100-day moving average.
• The lime line is the 200-day moving average.

Price testing or crossing any of these moving averages often either halts movement or injects fresh momentum into the market.

Markets reacted with higher Treasury yields and a notable strengthening of the dollar across most currencies. The Canadian dollar was the only notable exception, holding up thanks to an upbeat Canadian employment report.

Speculative positioning in the dollar against major global currencies barely changed over the reporting week — the net bullish bias stands at +$16.5 billion, with no signs of a reversal yet.

Overall, the US economy looks stronger than expected. Despite slowdown fears, including those driven by the war, the economy shows resilience and outperforms many countries dependent on Persian Gulf developments and energy supplies. Yet a contradiction remains: although nominal GDP growth has exceeded expectations, American households are not sharing the optimism — consumer confidence is at its lowest level since early 2024, and private consumption growth slowed in Q1.

Improvements in the labor market, an ongoing investment boom in artificial intelligence, and fiscal stimulus are producing results. At the same time, longer-term risks are rising and will materialize in time, though their current impact is limited. The government is seeing lower customs?duty revenues: it is now paying out as much in refunds as it collects, which widens the budget deficit. Rapid growth of US public debt could fuel inflation if investors begin to sell Treasuries. Tighter monetary policy supports the dollar, but higher interest rates also raise government debt-servicing costs. While this is largely a medium- to long-term concern, it still undermines the resilience of the dollar?based global financial system and contributes to the process of de-dollarization.

Wednesday's May inflation report is due and is likely to affect Fed rate expectations. If inflation continues to rise — a prospect few dispute — the probability of the Fed beginning a rate-hiking cycle before year-end will increase. That scenario would provide further support to the dollar.

Political tensions in the Middle East also bolster the dollar. US attempts to force Iran into a peace deal on Washington's terms have stalled, and the confrontation between Iran and Israel intensified after renewed Israeli strikes on Lebanon.

Thus, the labor report, the revised US economic outlook, and ongoing geopolitical tensions all support dollar strength. For now, there is no basis to expect a reversal in the dollar index.

On Monday, the crypto market breathed a little easier. Iran and Israel announced a pause in hostilities, giving prices a short-lived boost. Earlier, a direct clash between the two countries — the first since April — had spooked investors and pushed assets lower.

Bitcoin returned to about $64,000 after briefly slipping under $63,000 at the outset of the strikes, CoinDesk reports. Overall, the market remained under pressure: the Fear & Greed Index fell to very low levels, and total market capitalization is still a long way from last year's peaks.

It all started on Sunday. Israel carried out strikes on Beirut. In response, Iran launched nearly 30 ballistic missiles at Israel — the first such attack since the April 8 ceasefire. Israel then struck military targets in central and western Iran.

The escalation rattled markets. Bitcoin pulled back from an intraday high of $64,128 to around $63,316 as investors fled to safe-haven assets. Oil spiked sharply — Brent rose more than 4%.

On Monday, both sides announced a pause. Iran's military command said offensive operations had ceased and noted that Israel had "been taught a lesson."

Prime Minister Benjamin Netanyahu said the offensive was "paused." According to a regional source cited by the Associated Press, the US told Iran that Israel would stop strikes if Iran halted rocket fire.

President Trump posted on Truth Social that "both sides are ready for an immediate ceasefire" and that "final negotiations on 'peace' are ongoing."

But the market rebound is tentative. In recent weeks, Bitcoin plunged from about $77,300 to $59,100 amid worsening geopolitics, then recovered slightly above $60,000 before the latest flare-up. The two-month truce had been cracking for weeks as rocket and drone strikes in the region increased.

Both Iran and Israel have set conditions for keeping the pause. Iran warned of a tougher response if Israeli operations in Lebanon continue. Netanyahu vowed a "forceful response" to any new attacks. How long the rally will last largely depends on whether this fragile truce holds through negotiations between the US and Iran.

Months of optimism in the tech sector on Wall Street have given way to heavy profit-taking and a sharp market sell-off. The semiconductor industry, long the main engine of the rally, took the biggest hit. The sustained decline was triggered by growing analyst concerns that AI-linked assets are severely overvalued and that current market prices no longer reflect realistic rates of corporate profit generation.

A renewed geopolitical shock, which pushed commodity prices higher, added fuel to the panic. Rising oil increases inflationary pressure on the economy and reduces the likelihood of imminent central bank easing. In an environment of sharply elevated volatility, we recommend using InstaForex trading tools to open short positions in overheated tech stocks and monetize the downward momentum across the broader market. Follow the link for more details.

"Trump effect" fades: investor confidence collapses, sparking Bitcoin sell-off

The largest cryptocurrency has fully erased the post-2024 election price gains and has returned to prior local support levels. Current dynamics reflect deep disappointment among market participants, who have lost faith in the rapid delivery of pro-crypto measures promised by US President Donald Trump amid broader stresses in the global financial system. Growing pessimism has triggered profit-taking that quickly morphed into large-scale liquidation across the digital assets space.

Price declines have sharply reduced the market capitalization of crypto treasuries and major institutional holders. Investors are rapidly withdrawing liquidity from the sector and reallocating into traditional safe-haven assets as macroeconomic risks mount. The technical picture points to prevailing bearish sentiment, and stabilizing Bitcoin now requires more than verbal political interventions — it needs concrete regulatory action. Follow the link for more details.

The price test at 160.11 occurred at a moment when the MACD indicator had just begun moving downward from the zero line, which confirmed a valid entry point for selling the U.S. dollar. However, the expected decline in the pair did not materialize.

Given that markets are widely awaiting potential intervention from the Bank of Japan, no strong or directional movements are currently taking place. In the near term, data on U.S. small business sentiment (NFIB index), trade balance figures, and existing home sales will be released. These indicators have a certain level of importance for short-term forecasting of the U.S. economy and may influence trader sentiment.

The NFIB index is considered one of the key leading indicators, reflecting business activity levels and confidence among small business owners. A reading above expectations may support further upside in USD/JPY. At the same time, the trade balance reflects the ratio of exports to imports, where stronger-than-expected data may also support the U.S. dollar.

Finally, existing home sales — in a market where mortgage rates are rising almost daily — serve as an important indicator of the housing sector and the broader real estate market. They also indirectly reflect consumer confidence and mortgage affordability. Sustained growth in home sales would indicate stronger housing demand, which is unlikely. Weak housing data, on the other hand, may signal a slowdown in the real estate market and place some pressure on the U.S. dollar against the yen.

As for the intraday strategy, I will rely primarily on Scenarios #1 and #2.

Buy Signal

Scenario #1:

Today, I plan to buy USD/JPY when the price reaches the 160.23 level (green line on the chart), targeting a move toward 160.39 (thicker green line on the chart). At 160.39, I will exit long positions and open short positions in the opposite direction, targeting a 30–35 point move from the level. Further upside in the pair is possible only in the case of negative news regarding a potential U.S.–Iran agreement. Important: before buying, ensure that the MACD indicator is above the zero line and has just begun rising from it.

Scenario #2:

USD/JPY buying is also considered if there are two consecutive tests of 160.11, when the MACD indicator is in oversold territory. This would limit downward potential and trigger a reversal to the upside. A move toward 160.23 and 160.39 can be expected.

Sell Signal

Scenario #1:

I plan to sell USD/JPY after a breakdown below 160.11 (red line on the chart), which would lead to a quick decline in the pair. The key target for sellers is 159.87, where I will exit short positions and immediately open long positions in the opposite direction, targeting a 20–25 point rebound. Downward pressure may return if there is intervention from the Bank of Japan. Important: before selling, ensure that the MACD indicator is below the zero line and has just begun moving downward from it.

Scenario #2:

USD/JPY selling is also considered in the case of two consecutive tests of 160.23, when the MACD indicator is in overbought territory. This would limit upward potential and trigger a reversal to the downside. A decline toward 160.11 and 159.87 can be expected.

Chart Explanation

• Thin green line — entry price for buying the instrument
• Thick green line — expected take-profit level or area for manual profit-taking, as further upside above this level is unlikely
• Thin red line — entry price for selling the instrument
• Thick red line — expected take-profit level or area for manual profit-taking, as further downside below this level is unlikely
• MACD indicator — trading decisions should be guided by overbought and oversold zones

Important Notice

Beginner Forex traders should be very cautious when entering the market. Before major fundamental data releases, it is best to stay out of the market to avoid sharp volatility. If trading during news releases, always use stop-loss orders to minimize losses. Without stop-loss protection, you can quickly lose your entire deposit, especially if proper risk management is not used and large volumes are traded.

Remember that successful trading requires a clear trading plan, similar to the one presented above. Spontaneous trading decisions based on current market conditions are a losing strategy for intraday traders.

The price test at 1.3373 occurred at a moment when the MACD indicator had already moved significantly above the zero line, which limited the pair's upward potential. For this reason, I did not buy the pound and missed the upward move.

In the near term, the U.S. NFIB Small Business Optimism Index, as well as trade balance data and existing home sales figures, will be released. Although these macroeconomic reports may appear unrelated, together they form a broader picture of the state of the economy. Small business optimism is a leading indicator, reflecting entrepreneurs' confidence in future prospects, their willingness to invest, and their plans for expansion.

The trade balance reflects the competitiveness of U.S. goods and services in the global market, while existing home sales are a key indicator of consumer confidence and the financial system. Only strong readings across these indicators could reverse the current bullish momentum in GBP/USD.

As for the intraday strategy, I will rely primarily on Scenarios #1 and #2.

Buy Signal

Scenario #1:

Today, I plan to buy the pound when the price reaches the 1.3404 level (green line on the chart), targeting growth toward 1.3426 (thicker green line on the chart). Around 1.3426, I will exit long positions and open short positions in the opposite direction, targeting a 30–35 point move from the level. Further upside in the pound is only possible if U.S. data comes out weak. Important: before buying, ensure that the MACD indicator is above the zero line and has just begun rising from it.

Scenario #2:

Pound buying is also considered if there are two consecutive tests of 1.3382, when the MACD indicator is in oversold territory. This would limit downwardpotential and trigger a reversal to the upside. A move toward the opposite levels of 1.3404 and 1.3426 can be expected.

Sell Signal

Scenario #1:

I plan to sell the pound after a breakdown below 1.3382 (red line on the chart), which would lead to a quick decline in the pair. The key target for sellers is 1.3355, where I will exit short positions and immediately open long positions in the opposite direction, targeting a 20–25 point rebound. Downward pressure on the pound may return at any moment today. Important: before selling, ensure that the MACD indicator is below the zero line and has just begun moving downward from it.

Scenario #2:

Pound selling is also considered in the case of two consecutive tests of 1.3404, when the MACD indicator is in overbought territory. This would limit upward potential and trigger a reversal to the downside. A decline toward the opposite levels of 1.3382 and 1.3355 can be expected.

Chart Explanation

• Thin green line — entry price for buying the instrument
• Thick green line — expected take-profit level or area for manual profit-taking, as further upside above this level is unlikely
• Thin red line — entry price for selling the instrument
• Thick red line — expected take-profit level or area for manual profit-taking, as further downside below this level is unlikely
• MACD indicator — trading decisions should be guided by overbought and oversold zones

Important Notice

Beginner Forex traders should be very cautious when entering the market. Before major fundamental data releases, it is best to stay out of the market to avoid sharp volatility. If trading during news releases, always use stop-loss orders to minimize losses. Without stop-loss protection, it is possible to lose the entire deposit very quickly, especially without proper risk management and when trading large volumes.

Remember that successful trading requires a clear trading plan, similar to the one presented above. Spontaneous trading decisions based on current market conditions are inherently a losing strategy for intraday traders.

The price test at 1.1539 occurred at a moment when the MACD indicator had just begun moving downward from the zero line, which confirmed a valid entry point for selling the euro. However, the trade resulted in a loss, as the anticipated decline in the pair did not materialize.

Perhaps it was due to Trump's persistent statements that the conflict in the Middle East is about to end, or possibly strong German industrial production data — in any case, the euro managed to extend its previous gains, leading to a fairly solid recovery of Friday's sell-off.

Next, attention will shift to the U.S. NFIB Small Business Optimism Index, the trade balance, and existing home sales data. Although these macroeconomic indicators may appear unrelated, they are in fact closely interconnected, forming a broader picture of the U.S. economy. Small business optimism often serves as a leading indicator, reflecting entrepreneurs' confidence in the future and their willingness to invest and expand. The trade balance provides insight into the competitiveness of U.S. goods and services in global markets as well as domestic purchasing power. Existing home sales are one of the key indicators of consumer confidence and the financial sector. A decline in housing demand may indicate a negative trend, which would put pressure on the U.S. dollar.

A combined analysis of these three indicators provides a comprehensive view of the current economic situation. For example, if small business optimism is rising and new home sales are increasing, but a large trade deficit persists, this may suggest that domestic demand is strengthening while structural issues in external trade remain unresolved. Conversely, negative signals across all fronts may indicate an approaching recession.

As for the intraday strategy, I will rely more heavily on the execution of Scenarios #1 and #2.

Buy Signal

Scenario #1: Today, euro purchases may be considered when the price reaches the 1.1573 level (green line on the chart), targeting growth toward 1.1597. At 1.1597, I plan to exit the market and also consider selling in the opposite direction, targeting a 30–35 point move from the entry point. Further euro growth can be expected only if U.S. data comes out weak. Important: before buying, ensure that the MACD indicator is above the zero line and has just begun rising from it.

Scenario #2: Euro purchases are also considered today in the case of two consecutive tests of 1.1559, when the MACD indicator is in oversold territory. This would limit the downward potential of the pair and trigger a reversal to the upside. A move toward the opposite levels of 1.1573 and 1.1597 can be expected.

Sell Signal

Scenario #1: Euro selling is planned after reaching the 1.1559 level (red line on the chart). The target is 1.1532, where I plan to exit the market and immediately buy in the opposite direction (expecting a 20–25 point rebound from the level). Downward pressure on the pair may return at any moment today. Important: before selling, ensure that the MACD indicator is below the zero line and has just begun moving downward from it.

Scenario #2: Euro selling is also considered in the case of two consecutive tests of 1.1573, when the MACD indicator is in overbought territory. This would limit upward potential and trigger a reversal to the downside. A decline toward the opposite levels of 1.1559 and 1.1532 can be expected.

Chart Explanation

• Thin green line — entry price for buying the instrument
• Thick green line — expected take-profit level or area for manual profit-taking, as further growth above this level is unlikely
• Thin red line — entry price for selling the instrument
• Thick red line — expected take-profit level or area for manual profit-taking, as further decline below this level is unlikely
• MACD indicator — trading decisions should consider overbought and oversold zones

Important Notice: Beginner Forex traders should be very cautious when entering the market. Before major fundamental data releases, it is best to stay out of the market to avoid sharp price volatility. If you decide to trade during news releases, always place stop-loss orders to minimize losses. Without stop-loss protection, you can quickly lose your entire deposit, especially if proper risk management is not used and large volumes are traded.

Remember that successful trading requires a clear trading plan, such as the one outlined above. Making spontaneous trading decisions based on current market conditions is fundamentally a losing strategy for intraday traders.

Trump's statements that the conflict in the Middle East may soon come to an end, along with a sharp increase in demand for risk assets, continue to weigh on the U.S. dollar. Strong German industrial production data allowed euro buyers to return to active trading. Traders who had previously been concerned about an escalation of tensions in the Middle East and a slowdown in global growth now see reasons for a more optimistic outlook. However, despite these positive signals, caution remains warranted. Uncertainty surrounding the political situation in the Middle East and the U.S. inflation data scheduled for tomorrow could quickly change market sentiment.

During the second half of the day, attention will be focused on the U.S. NFIB Small Business Optimism Index, the trade balance report, and existing home sales data. While these indicators do not play a decisive role in shaping short-term forecasts for the U.S. economy, they may still influence trader sentiment.

The NFIB Small Business Optimism Index is one of the leading indicators reflecting business activity and confidence among small-business owners. An improvement in this indicator generally signals a willingness among companies to invest, expand payrolls, and increase spending, which is supportive of the U.S. dollar.

The trade balance, in turn, provides insight into the relationship between a country's exports and imports. A trade deficit, where imports exceed exports, may put pressure on the national currency.

Finally, existing home sales serve as an important gauge of the housing sector and the real estate market as a whole. They also indirectly reflect consumer confidence and mortgage affordability. Strong sales figures—although unlikely given the current high mortgage rates—could also support the dollar.

If the data comes in strong, I will rely on the Momentum strategy. If the market shows little reaction to the releases, I will continue using the Mean Reversion strategy.

Momentum Strategy (Breakout Trading) for the Second Half of the Day

EUR/USD

• A breakout above 1.1575 may lead to a rise toward 1.1600 and 1.1625;
• A breakout below 1.1555 may lead to a decline toward 1.1530 and 1.1505;

GBP/USD

• A breakout above 1.3405 may lead to a rise toward 1.3441 and 1.3478;
• A breakout below 1.3380 may lead to a decline toward 1.3360 and 1.3340;

USD/JPY

• A breakout above 160.24 may lead to a rise toward 160.43 and 160.67;
• A breakout below 160.02 may trigger a decline toward 159.83 and 159.60;

Mean Reversion Strategy for the Second Half of the Day

EUR/USD

• I will look for short positions after a false breakout above 1.1575 followed by a return below this level;
• I will look for long positions after a false breakout below 1.1535 followed by a return above this level;

GBP/USD

• I will look for short positions after a false breakout above 1.3410 followed by a return below this level;
• I will look for long positions after a false breakout below 1.3355 followed by a return above this level;

AUD/USD

• I will look for short positions after a false breakout above 0.7069 followed by a return below this level;
• I will look for long positions after a false breakout below 0.7038 followed by a return above this level;

USD/CAD

• I will look for short positions after a false breakout above 1.3945 followed by a return below this level;
• I will look for long positions after a false breakout below 1.3927 followed by a return above this level.

See also: InstaForex trading indicators for USD/CAD.

The USD/CAD pair continues to attract traders' attention, showing a rare mix of opposing forces. On the one hand, an aggressive Federal Reserve stance and geopolitical tensions are pushing the pair higher, testing multi-month highs. On the other hand, peace attempts in the Middle East and domestic problems in the Canadian economy are forcing the loonie to balance on a knife edge.

The first week of June closed on a major note for USD/CAD, with the pair updating two-month highs around 1.3950 and rising another ten pips on Monday to 1.3960. The combination of two powerful factors — a hawkish shock from US labor market data and rising Middle East tensions — hit the risk-sensitive Canadian dollar while strengthening the US dollar as a safe haven.

Yet the loonie has its own oil cushion that limits a deeper fall. As a result, the pair is in a state of tenuous equilibrium, trading just below the psychological 1.4000 level while awaiting key trigger—US inflation (CPI) data on Wednesday.

Fundamental background: double hit to CAD, triple support for USD

The main driver of the pair's rise was the shocking US nonfarm payrolls report for May. The US economy added 172,000 jobs (consensus 85,000), and revisions to the previous two months added 93,000 more jobs. This prompted a radical repricing of Fed rate expectations. According to CME FedWatch, the probability of at least one Fed rate hike by year-end jumped above 70% (from 45% a week earlier).

Ten-year US Treasury yields settled above 4.55%, and the dollar index (USDX) pushed toward 100.00, renewing two-month highs.

While the US dollar strengthens on hawkish expectations, the Canadian dollar remains vulnerable because the domestic economy unexpectedly slipped into recession and the Bank of Canada is giving dovish signals.

Key Canadian indicators

- GDP (Q1 2026) was -0.1% q/q versus a +1.5% forecast; Q4 contraction was revised to -1.0%—a technical recession is confirmed.

- Labor market: unemployment rose to 6.6% in May, although employment unexpectedly increased 0.4% m/m.

- Inflation remains slightly above the 2.0% target, at 2.8% y/y.

Geopolitical and commodity factor: oil swings

The weekend saw a fresh escalation in the Middle East. Israel and Iran exchanged direct missile strikes, and Yemeni Houthis attacked Israeli territory. That pushed crude prices up (WTI spiked to $94.80 per barrel), which paradoxically supported CAD while also strengthening the dollar as a safe haven.

By Tuesday morning, oil prices had corrected to $88–89 as hopes of a US-Iran deal resurfaced following statements from Trump about a "final stage" of talks. For Canada, a major oil exporter, a decline in crude is bearish for the loonie.

- Strong NFP (172k) — Upward pressure: probability of Fed hike rose above 70%.

- Escalation in Iran/Israel — Upward pressure: flight to the dollar as a safe haven.

- Hopes for a US-Iran deal — Downward pressure: weaker dollar demand, falling oil hurts CAD.

- Expectations of a Bank of Canada pause (June)—Upward pressure: markets price a 2.25% BoC rate to hold.

- Weak Canadian GDP (-0.1%) — Upward pressure: economy in recession limits BoC action.

- US CPI (Wednesday) — High volatility expected; forecast 4.2% y/y; strong prints could push the pair above 1.4000.

Brief technical analysis

Technically the price has closed above key moving averages on the daily and weekly charts, confirming a shift to a medium-term uptrend. Late last month the pair broke key resistance at 1.3795 (200-day EMA on the daily) and 1.3810 (50-week EMA) and is now approaching the psychologically important round level 1.4000.

The 14-day RSI on the daily is near 70, indicating sustained upside momentum but close to overbought territory. On the 4-hour chart, the RSI (59) and Stochastic (exiting overbought and moving toward the sell zone) warn of a likely correction in the next one to two days. The OsMA on D1 is positive (+0.0085), but the histogram is contracting, indicating slowing momentum.

The nearest resistance levels: 1.3960 and 1.4000 (psychological), then 1.4130 (annual high, November 2025).

The nearest support levels: 1.3900 (central pivot), 1.3881 (200-hour EMA on H1), 1.3850 (Friday low), and 1.3780 (50-day EMA on D1).

Key events this week

- Wed, 10 June 12:30 GMT — US CPI (May). Forecast: 4.2% y/y (prev. 3.8%). Impact: strong print will push USD/CAD above 1.4000; weak print will trigger a correction.

- Wed, 10 June 13:45 GMT — Bank of Canada rate decision. Expected: 2.25% (no change). A dovish signal will boost the pair; an unexpected hike will sharply lower USD/CAD.

- Thu, 11 June 12:30 GMT — US PPI. Secondary inflation indicator: the data may reinforce or weaken the trend after CPI.

- Thu, 11 June 12:15 GMT — ECB rate decision and Lagarde press conference. Expected: hike to 2.40%. The data may affect USD via EUR crosses.

Conclusion

USD/CAD sits at the epicenter of an "ideal storm" for the Canadian dollar, with an important caveat. On one side, a hawkish Fed pivot (probability of a Fed hike rose to ~70%) and a dollar rally to 100.00 on the USDX create strong tailwinds for USD. On the other hand, the Bank of Canada pause expectations (economists warn that market pricing for a 50-bp BoC move in the next 12 months looks aggressive given the weak economy) and Canada's unexpected recession (GDP -0.1% q/q) remove internal support for the loonie.

High oil prices and a geopolitical premium continue to support the Canadian dollar, preventing a sharp USD/CAD plunge.

The key zone 1.3850–1.4050 will be the battlefield over the coming days. A technical break below 1.3850 would open the way to 1.3800–1.3780 and 1.3650 (200-week EMA), while a sustained close above 1.4000 could trigger a move to 1.4130.

Priority in the current setup is to short near the upper range boundary 1.3960–1.4000, especially if CPI does not confirm accelerating inflation in the US; conversely, take long positions if US inflation confirms acceleration. Traders should exercise extreme caution: Wednesday will be a decisive macro test driven by two powerful factors — US CPI and the Bank of Canada decision.

Gold (XAU/USD) is showing limited movement on Tuesday, remaining within a narrow range during the European session. The U.S. dollar retreated from a two-month high after Iran and Israel announced on Monday that they would halt mutual attacks following a call from U.S. President Donald Trump. This development has provided moderate support for the precious metal. Nevertheless, market participants remain cautious and prefer to wait for further developments in the Middle East, keeping prices near the lowest levels seen since March 23, recorded the previous day.At the same time, diplomatic contacts between the United States and Iran remain stalled due to significant disagreements over Tehran's nuclear program. In particular, Trump emphasized that any peaceful resolution must eliminate the possibility of Iran developing nuclear weapons. Iran, in turn, continues to insist on international recognition of its sovereignty, control over shipping through the Strait of Hormuz, the removal of sanctions, and the unfreezing of its assets. These substantial differences continue to support a geopolitical risk premium, sustaining demand for safe-haven assets.

In addition, shipping activity through the strategically important Strait of Hormuz remains constrained, maintaining elevated volatility in energy markets. This increases inflation risks and strengthens expectations of tighter monetary policy from major central banks, including the U.S. Federal Reserve. According to CME Group's FedWatch Tool, the market currently assigns a probability of more than 70% to a Federal Reserve interest-rate increase before year-end. This factor is keeping U.S. Treasury yields elevated, limiting downward pressure on the dollar and restraining gains in non-yielding gold.

Investors may also remain cautious ahead of upcoming U.S. inflation data. Reports on the Consumer Price Index (CPI) and Producer Price Index (PPI) for May are scheduled for release on Wednesday and Thursday, respectively. These indicators are key to assessing the future path of Federal Reserve monetary policy and, consequently, the direction of the U.S. dollar.

At the same time, geopolitical developments are likely to remain a source of additional volatility and short-term price swings for gold. Overall, current fundamental conditions continue to favor a bearish outlook for XAU/USD, and any recovery attempts are likely to attract renewed selling interest.

From a technical perspective, last week's consolidation below the 200-day Simple Moving Average (SMA) reinforced bearish sentiment. However, the subsequent decline lost momentum near the $4,260 level. Therefore, it would be prudent to wait for a decisive break below this area before considering new short positions.

Technical indicators remain in negative territory, suggesting that bears continue to hold the advantage. The Relative Strength Index (RSI) is approaching oversold conditions, which is limiting aggressive selling activity.

The nearest resistance level is located at $4,350, followed by resistance near the 200-day Exponential Moving Average (EMA) and the psychological level of $4,400. Beyond that, gold will face resistance at the 200-day SMA near $4,435.

A break above this level would help bulls reduce the current downward pressure, after which the next obstacle would be the 20-day SMA near the psychological level of $4,500.

This area remains a significant barrier that continues to limit upward potential within the prevailing bearish market structure.

The purchase immediately spawned a conspiratorial theory that is widely discussed in the crypto community: what if Strategy deliberately sold 32 Bitcoin at $77,135 to provoke FUD and additional market pressure in order to repurchase coins cheaper afterwards? The logic is elegant: sell a small amount at a high price, sow panic, wait for the decline, buy back a larger amount at a lower price. If the Bitcoin were repurchased in the $60,000–$65,000 range, the arbitrage would amount to tens of millions of dollars of net profit in Bitcoin for the company—precisely the metric Saylor has called the goal of his operations. Intent cannot be proven, but the arithmetic fits: 32 coins sold and 1,550 bought do not look like a forced liquidation.

In any case, the market signal from the trade is unambiguous: Strategy does not intend to give up. The company is buying against the backdrop of $5.4 billion of total outflows from Bitcoin ETFs over four weeks, a breach of the $60,000 level, and widespread pessimism. This is either a show of iron confidence in the long-term narrative or a forced attempt to support the company's equity price—most likely both simultaneously.

Trading recommendations:

Buyers of Bitcoin are currently targeting a return to $63,600, a level that would open a direct path to $65,800 and then to $67,700; a breach above $67,700 would indicate attempts to restore the bull market. On the downside, buyers are expected at $61,100. A drop below that area could quickly push BTC toward $59,600, with a farther target at $58,200.

As for Ethereum, a clear hold above $1,724 would open a direct route to $1,783. The farther target is the high near $1,838; a break above that level would signal strengthening bullish sentiment and renewed buyer interest. On the downside, buyers are expected at $1,645. A fall below that level could rapidly send ETH toward $1,563, with a deeper target at $1,476.

What we see on the chart:

- Red lines indicate support and resistance levels where either a price slowdown or active growth is expected;

- Green lines indicate the 50-day moving average;

- Blue lines indicate the 100-day moving average;

- Light green lines indicate the 200-day moving average.

A crossover, or a price test of moving averages, typically either halts the move or sparks fresh market momentum.

And yet, longs in the pair still look risky. The bears have not capitulated but have merely made a tactical retreat ahead of key US inflation releases. May CPI and PPI data, to be published on Wednesday and Thursday, could provide additional support to the greenback and further strengthen an already favorable dollar fundamental backdrop.

According to the CME FedWatch tool, the market is almost 100 percent confident the Fed will keep the policy rate unchanged at the next two meetings — in June and July. By contrast, the outlook for September is less clear: the probability of a 25-basis-point hike is now estimated at roughly 40 percent. If the upcoming inflation releases prints in the green zone (especially core measures), hawkish expectations regarding further Fed action will grow again, and the dollar will once more enjoy heightened demand.

Preliminary forecasts indicate a high likelihood of that scenario. Most analysts expect the headline consumer price index to reach a three-year high of 4.2% year-on-year. Core CPI, excluding food and energy, is also expected to show an upward move to 2.9% year-on-year.

Leading indicators signal that core inflation may surprise traders on the upside, reaching the three-percent mark. A key signal here is an increase in the price's components of ISM business activity indices in both services and manufacturing, which traditionally lead consumer price dynamics. Continued wage growth (despite a modest slowdown in the rate to 3.4% in May) and a high level of job openings (7.62 million) also support inflation in the services sector. In addition, rising inflation expectations among households and businesses further raise the risk of price inertia.

All these signs increase the probability that core consumer prices will accelerate more than expected — to 3.0% or higher.

Market expectations are similar for May PPI, to be released on Thursday. Most experts expect the headline producer price index to speed up to 6.8% from 6.0% and core PPI to rise to 5.3% (after 5.2% in April). Again, if core PPI accelerates more than expected, the dollar will be well supported, including versus the euro.

In other words, the upside prospects for EUR/USD are highly uncertain. Long positions in the pair are therefore risky now, especially ahead of the CPI and PPI releases. Against a backdrop of rising hawkish expectations for Fed policy, the pair will remain under background pressure. Therefore, corrective price spikes are best treated as opportunities to open short positions. The key support level remains 1.1500 (the lower Bollinger band line on the H4 chart).

However, risks to the downside scenario remain: a potential US-Iran deal would be a kind of Damocles' sword for the southbound trend. For example, today Donald Trump again said the parties are very close to a strong and powerful agreement.

The market reacted cautiously to those words, which is understandable—according to CNN's calculations, the US president has said 37 times (!) that a deal with Iran is imminent. More than two months ago, on 7 April, Trump posted that the talks were at a very advanced stage but that two weeks were needed to polish and conclude the agreement. No resolution followed, yet in subsequent months he repeatedly and unambiguously suggested that a deal was at hand. Analysts surveyed say that there is no sign that today is any closer to the truth than 7 April. Positions remain far apart, and neither side appears prepared to accept broad unilateral concessions.

If the diplomatic track remains in its current sluggish format (without significant escalation or de-escalation), traders will focus on inflation data. The CPI and PPI reports are likely to support the dollar and, therefore, sellers of EUR/USD.

The firm lists three factors that make this scenario increasingly probable: a large investment cycle in AI, a tightening of conditions in energy markets, and a strengthening labor market. All three are present at the same time and reinforce one another.

On the labor market, the central point of Fed attention, low unemployment and constrained labor supply mean any further acceleration risks pushing wages above levels compatible with 2% inflation. The May employment report — +172,000 jobs versus a forecast of 85,000 — confirmed that this risk is not hypothetical. Markets are already pricing a 25-basis-point hike by December, and the chance of an earlier move in September is growing.

A separate thesis worth attention concerns inflation even after a possible reopening of the Strait of Hormuz. The firm warns that even if the conflict with Iran is resolved, price pressure will not automatically disappear. Inventories depleted during the blockade will need replenishing. Governments and companies, scarred by the energy crisis, will build larger strategic reserves and diversify supply chains—a structural rise in costs across the economy for many months to come. In other words, reopening the strait will reduce the geopolitical premium in oil but will not eliminate inflationary pressure entirely.

A final risk that is receiving little attention so far is political pushback against AI. Ahead of the November midterm elections, concerns about job losses, energy consumption, and inflation are attracting growing political attention.

For the dollar, the picture is unequivocally positive. Fed rate hikes in the context of a resilient economy and persistent inflation make US assets more attractive to global investors—the yield gap between the United States and other major economies will widen. If the ECB pauses after a June increase while the Fed continues to tighten, monetary divergence will favor the dollar against the euro and other developed market currencies. For emerging markets, a stronger dollar and higher US rates mean capital outflows and pressure on local currencies — a pattern that is already observable.

Technical outlook for EUR/USD

Buyers of EUR/USD should consider taking 1.1550. That will allow a test of 1.1580, and from there the pair could reach 1.1600, although advancing beyond that level without support from major participants would be difficult. The farther target is the high near 1.1625. On the downside, only substantive buying interest around 1.1530 would prompt large players to act; absent that, it would be prudent to wait for a new low at 1.1505 or to consider long entries from 1.1480.

Technical outlook for GBP/USD

For GBP/USD, sterling buyers must clear the nearest resistance at 1.3370 to target 1.3405; moving above that level may prove difficult, with a further target at 1.3440. If the pair falls, bears will seek to seize control at 1.3335. A decisive break below 1.3335 would likely inflict significant damage on long positions and could push GBP/USD toward 1.3300, with downside risk extending to 1.3285.

Gold is struggling to gain momentum on Tuesday, trading within a narrow range during the European session.

From a technical perspective, last week's consolidation below the 200-day Simple Moving Average (SMA) reinforced bearish sentiment. However, the subsequent decline lost momentum near the support of the downward channel around the $4,260 level. Therefore, a decisive break below this zone is needed to confirm further downward potential.

The Relative Strength Index (RSI) remains near the 33 mark, staying in negative territory without reaching oversold conditions, although it is approaching that threshold. The MACD indicator also remains in negative territory with limited momentum, suggesting that sellers retain the advantage, but without signs of an aggressive continuation of the move.

Against this backdrop, any corrective recovery is likely to face initial resistance at $4,350, followed by resistance near the 200-day Exponential Moving Average (EMA), then at the psychological level of $4,400, and the 200-day SMA at $4,435.

A break above this level is required for bulls to ease the current downward pressure, after which the next target would be the 20-day SMA near the psychological level of $4,500.

This level remains a significant barrier, limiting upward potential within the prevailing bearish structure.

On the lower timeframe, a classic five-wave bearish structure can be identified. Following the completion of this structure, the pair may transition to a new upward wave sequence, and at this stage the pattern appears complete. Therefore, a rebound from the 1.1513 level, which corresponds to the 76.4% Fibonacci retracement level, may support further appreciation of the euro. However, without support from geopolitical developments and the ECB, any upward movement in the euro is likely to remain limited.

The EUR/USD pair changed little during Monday's trading session, while volatility remained subdued. News flow was limited, and market participants found little of interest. Today's session may also remain relatively quiet, as traders appear to be conserving their resources ahead of Wednesday and Thursday.

It should be noted that the U.S. inflation report for May will be released tomorrow, while Thursday will bring the ECB policy meeting and remarks from Christine Lagarde. What can be expected from these events?

The outlook for U.S. inflation is relatively straightforward. The higher the inflation reading, the stronger the market's expectations for tighter Federal Reserve monetary policy. However, the market already assumes that the FOMC may raise interest rates this year. Therefore, this factor appears to be largely priced in. As a result, even a strong inflation reading is unlikely to trigger a substantial rise in the U.S. dollar.

If inflation declines, given the Federal Reserve's reluctance to raise rates, the dollar could begin to lose support. In my view, the Consumer Price Index report is unlikely to provide significant support for sellers this week.

The ECB meeting, by contrast, is currently being largely ignored by the market. Market participants are focused on a potential Federal Reserve rate increase but are paying less attention to the ECB rate hike expected on Thursday. Consequently, the factor of monetary policy tightening in the Eurozone may not yet be fully reflected in market pricing.

If this assessment is correct, the euro could begin forming a new upward trend segment toward the end of the week. Initially, this move would be considered corrective. However, with support from geopolitical developments, it could evolve into an impulsive advance. In my view, the current balance between risk and potential reward remains favorable for opening long positions. Nevertheless, traders should continue to monitor developments closely, as a breakdown in negotiations between Iran and the United States could trigger renewed strength in the U.S. dollar.

General Conclusions

Based on the EUR/USD analysis, I conclude that the instrument remains within the broader upward trend segment (shown in the lower chart), while in the shorter term it remains within a downward trend segment that may already be complete.

In my opinion, the current environment presents a reasonable opportunity to consider long positions. The unsuccessful attempt to break below 1.1513, which corresponds to the 76.4% Fibonacci retracement level, together with the completed appearance of the downward trend structure, suggests that the pair may transition to a new upward wave sequence with targets near the 1.1700 level and above.

On the higher timeframe, an upward trend segment remains visible, followed by the development of a corrective wave structure. In the near term, wave C is expected to form with targets near 1.1352, which corresponds to the 38.2% Fibonacci retracement level. Once the A-B-C corrective structure is completed, a new long-term upward trend may begin.

Key Principles of My Analysis

1. Wave structures should be simple and clearly identifiable. Complex structures are difficult to trade and are frequently subject to revision.
2. If there is no confidence in the market situation, it is better to stay out of the market.
3. Absolute certainty regarding market direction does not exist. Always use protective Stop Loss orders.
4. Wave analysis can be combined with other forms of analysis and trading strategies.

The wave structure on the hourly chart remains straightforward. The latest completed upward wave broke above the previous peak, while the latest downward wave broke below the previous low. Therefore, the trend has once again shifted to bearish. Bulls may launch a new offensive only if Iran and the United States sign an interim agreement, stop violating the ceasefire terms, and the Strait of Hormuz remains open. Without these conditions, further appreciation of the euro will be extremely difficult.

No important economic data were released on Monday, and traders began shifting their focus from the U.S. economy and geopolitics to the ECB meeting and the upcoming U.S. inflation report. The inflation report is currently not the most important factor for traders, even if the May reading exceeds the April figure. Inflation in the United States is accelerating, and that is a fact. However, the Federal Reserve has so far not responded to this acceleration and is waiting for the conflict in the Middle East to be resolved. Therefore, the U.S. Consumer Price Index could jump to 4.2% in May, but that would not necessarily mean that the Fed is preparing to tighten monetary policy in the near future. For this reason, I do not consider the inflation report the key event of the week.

The ECB meeting is a different matter. It could mark the beginning of a tightening cycle among the G7 central banks. Regardless of how much the market has ignored non-geopolitical developments in recent months, it is unlikely to overlook an interest rate increase as a response to the geopolitical conflict itself. Therefore, bulls may be able to conduct moderate attacks this week, while Donald Trump stated again this morning that the conflict with Iran could be resolved within the next two weeks.

On the 4-hour chart, the pair rebounded from the 38.2% Fibonacci retracement level at 1.1667 and resumed its decline within the descending trend channel. Consolidation below the 23.6% Fibonacci level at 1.1569 supports expectations for a continuation of the decline toward the next retracement level of 0.0% at 1.1411. I will begin to expect a bullish trend only after prices close above the channel. No emerging divergences are currently observed on any indicator.

Commitments of Traders (COT) Report

During the latest reporting week, professional traders opened 12,387 long positions and closed 7,053 short positions. Over the seven weeks of February and March, the bulls' overwhelming advantage disappeared due to the war in Iran, while during the past ten weeks the situation has stabilized amid the suspension of hostilities in the Middle East. The total number of long positions held by speculators currently stands at 235,000, compared with 186,000 short positions. The gap is once again widening in favor of the bulls.

Overall, large market participants continue to view the euro favorably over the long term. Naturally, global developments of various kinds—of which there has been no shortage in recent years—continue to influence investor sentiment. In particular, the market's attention remains focused on the Middle East, where the conflict has merely been paused rather than resolved. Therefore, in the near term, the direction of the euro and the dollar will depend less on Federal Reserve or ECB monetary policy and economic data, and more on developments in Iran.

Economic Calendar for the United States and the European Union

Germany

• Industrial Production (06:00 UTC)

United States

• Existing Home Sales (14:00 UTC)

The economic calendar for June 9 contains only two secondary events. Therefore, the impact of the economic backdrop on market sentiment on Tuesday is expected to be extremely limited.

EUR/USD Forecast and Trading Recommendations

Short positions may be considered today if the pair closes below 1.1514 on the hourly chart, with a target at 1.1409. Alternatively, selling opportunities may arise on a rebound from 1.1578, targeting 1.1514. Long positions could be initiated on a rebound from 1.1514, with targets at 1.1578 and 1.1630. These positions may still be held today.

Fibonacci grids are drawn from 1.1409 to 1.1850 on the hourly chart and from 1.2081 to 1.1411 on the 4-hour chart.

On Wednesday, the consumer inflation report will be released, with inflation expected to continue rising amid overall price increases in America, driven by higher energy prices that underpin the entire chain of goods and services. The importance of this data is indeed significant. While a fragile balance of "neither peace nor war" persists in the Middle East, market participants have focused their attention on economic data from America. A striking example of this is the volatile market reaction to last Friday's report on new jobs in the non-farm sector of the national economy.

This parallel offers hope that tomorrow's inflation report may also serve as a strong basis for notable asset price movements. If the data show an increase in the Consumer Price Index (CPI) in line with forecasts or higher, this will likely support the dollar, pushing the ICE index back above 100 points and consolidating firmly above it.

We can also expect a resumption of corrections in stock markets, primarily in the U.S. This could again lead to a continued decline in gold prices and possibly in futures for the two main types of oil, WTI and Brent.

Given such a scenario, a renewed decline in demand in the cryptocurrency market should also be expected. Bitcoin may fall below the 60,000 mark, while yields on U.S. Treasuries might rise.

What to Expect in the Markets Today?

I believe the importance of the economic data to be released tomorrow will force market participants to exercise caution, which will be reflected in low activity and overall consolidation of asset values across all markets.

Daily Forecast:

Gold

The price of gold remains under pressure due to the potential continuation of inflation growth in America, which may lead to an increase in the Fed's interest rates. If this scenario materializes, it is advisable to sell gold at a price of 4290.20.

GBP/USD

The pair is consolidating below the level of 1.3375. Rising inflation in the U.S. may lead it to first drop to 1.3300 and then to 1.3250. The selling level for the pair could be marked at 1.3360.

The wave structure remains bearish, as bulls lack positive geopolitical developments to support a full-scale advance. The latest completed upward wave failed to break above the previous peak, while the latest downward wave broke below the previous low. Geopolitical conditions remain highly uncertain at present, leaving neither bulls nor bears with a clear advantage. The bearish trend can be considered complete only after the June 5 high is surpassed.

There was no significant news background on Monday, which explains the low level of trading activity. However, interesting developments began to emerge on Tuesday morning. It is difficult to describe Trump's latest promise to sign a deal with Iran within two weeks as "important information," given that the U.S. president has made numerous similar statements over recent months. In fact, nearly every week Trump repeats the same message — that a resolution to the conflict with Iran will be achieved within days, weeks, or some unspecified period. As a result, the rhetoric of the U.S. leader remains unchanged, while the market continues to be fed expectations of an imminent end to the conflict and lower oil prices. Following Trump's comments, the U.S. dollar weakened slightly, but only marginally, as confidence in the president's promises is currently very low. According to Trump, Iran is already prepared to abandon its nuclear weapons ambitions, but similar statements were made several weeks ago. At that time, they were completely rejected by Tehran. Most likely, the same will happen again. Today or tomorrow, Iranian officials may once again state that no progress has been made in negotiations with the United States and that the issue of removing Iran's stockpile of enriched uranium is not even under discussion. Therefore, this week bulls should place their hopes on a weak inflation report and a tightening of ECB monetary policy.

On the 4-hour chart, GBP/USD rebounded from the 1.3482–1.3514 resistance level and declined toward the 23.6% Fibonacci retracement level at 1.3327. A consolidation below this level would allow bears to continue the downward move toward the next Fibonacci level of 0.0% at 1.3159. A rebound from 1.3327 would favor the pound and support a moderate recovery toward 1.3429. No emerging divergences are currently observed on any indicator.

Commitments of Traders (COT) Report

Sentiment among the Non-commercial category became less bearish during the latest reporting week. The number of long positions held by speculators decreased by 4,291, while short positions declined by 13,471. The gap between long and short positions now stands at approximately 53,000 versus 110,000. Bears have dominated in recent months, which comes as no surprise given the geopolitical situation in the Middle East and the political crisis in the United Kingdom. The bearish advantage currently exceeds two-to-one.

I still do not believe in a sustained bearish trend for the pound. However, in the near term, developments will depend less on economic indicators, Trump's trade policy, or central bank monetary policy, and more on the duration, scale, and consequences of the conflict in the Middle East. In recent weeks, the market has adjusted to the expectation of a prolonged conflict, but recent developments suggest that a ceasefire may still be achievable, although neither quickly nor easily.

News Calendar for the United States and the United Kingdom

United States

• Existing Home Sales (14:00 UTC)

The economic calendar for June 9 contains only one event, which is unlikely to attract significant market attention. Therefore, the influence of the economic backdrop on market sentiment on Tuesday is expected to be extremely limited.

GBP/USD Forecast and Trading Recommendations

Short positions were possible after a rebound from the 1.3454–1.3466 resistance level on the hourly chart, targeting 1.3408 and 1.3349–1.3355. Both targets have been reached. New short positions may be considered following a close below the 1.3349–1.3355 level, with a target at 1.3277. Long positions were possible after a consolidation above the 1.3349–1.3355 level, targeting 1.3408. These positions may still be held today.

Fibonacci grids are drawn from 1.3158 to 1.3655 on the hourly chart and from 1.3866 to 1.3158 on the 4-hour chart.

S&P 500 and index forecasts dynamics

I agree with Morgan Stanley and Citigroup. Experts also believe that investors have not lost interest in mega-cap tech and have raised their S&P 500 target from 7,700 to 8,100, citing optimistic forward-earnings estimates.

Indeed, last Friday's losers were among Monday's best-bought names. The Philadelphia Semiconductor Index jumped by about 5% after the record sell-off. Even Intel held up well on reports that Google and NVIDIA are considering its products as contingency options.

Philadelphia Semiconductor Index performance

That said, the market remains concerned about persistent inflation and the prospect of Fed tightening. The S&P 500's recovery was uneven: 8 of 11 sectors finished lower. Only about 180 stocks advanced, while the rest closed in the red.

High market concentration, stretched fundamentals, and fears of interest rate hikes that could trigger a recession are forcing investors to stay cautious.

That caution and profit-taking is exactly what Bank of America urges. Their research shows 70% of downside signals have been triggered versus 50% at prior peaks. Using 20 proprietary measures, BofA finds that the S&P 500 appears overvalued on 17; on 8 measures, the broad index looks like a tech bubble.

So large banks are split on the S&P 500's near-term path. Morgan Stanley and Citigroup recommend buying the dip; Bank of America advises locking in gains.

My view is that the next real test for the broad index will be the release of US inflation data. Bloomberg consensus forecasts headline CPI at 4.2% year-on-year and core CPI at 2.9%. Such prints would move odds of Fed tightening forward from December to earlier in the cycle. That would push Treasury yields higher and dent global risk appetite, which is clearly bad news for equities.

Technically, the daily chart shows that the S&P 500 has formed an inside bar after the large sell-off. It makes sense to place two pending orders: a buy order near the inside bar high around 7,465 and a sell order near the low at 7,395.

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Important:

The begginers in forex trading need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp market fluctuations due to increased volatility. If you decide to trade during the news release, then always place stop orders to minimize losses.

Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes. For successful trading, you need to have a clear trading plan and stay focues and disciplined. Spontaneous trading decision based on the current market situation is an inherently losing strategy for a scalper or daytrader

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The price test at 159.98 occurred when the MACD indicator had moved significantly below the zero mark, limiting the pair's downward potential. The second test at 159.98 coincided with the MACD being in the oversold area, leading to the execution of Scenario #2 for buying the dollar. As a result, the pair rose by 20 pips.

Despite yesterday's decline in the USD/JPY pair, driven by geopolitical upheavals and further Iranian strikes on U.S. bases, pressure on the yen quickly returned. Asian markets, which reopened after the weekend, reacted to the escalation of tensions in the Middle East, further fueling demand for traditional safe-haven assets. All of this suggests that yesterday's strengthening of the yen was short-lived, reflecting more of a central bank intervention rather than a sustainable trend. Due to the situation in the Middle East, the yen will continue to demonstrate weakness against the dollar.

In the near term, traders are betting on elevated volatility in the USD/JPY pair, as everyone expects intervention from the Bank of Japan in the form of currency interventions.

Regarding the intraday strategy, I will rely more on implementing Scenarios #1 and #2.

Buying Scenarios

Scenario #1: I plan to buy USD/JPY today at the entry point around 160.23 (green line on the chart), with a target of 160.39 (thicker green line on the chart). At around 160.39, I plan to exit the long positions and sell in the opposite direction (anticipating a movement of 30-35 pips from the level). It is best to return to buying the pair during corrections and significant pullbacks in USD/JPY. Important! Before buying, ensure that the MACD indicator is above the zero mark and is just starting to rise from there.

Scenario #2: I also plan to buy USD/JPY today in the case of two consecutive tests of the price 160.11 when the MACD is in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. Growth can be expected towards the opposite levels of 160.23 and 160.39.

Selling Scenarios

Scenario #1: I plan to sell USD/JPY today only after it breaks the level of 160.11 (red line on the chart), which will trigger a rapid decline in the pair. The key target for sellers will be 159.87, where I plan to exit the short position and immediately buy in the opposite direction (anticipating a move of 20-25 pips in the opposite direction from the level). Sellers will return at any moment; all it takes is a hint from the central bank. Important! Before selling, ensure that the MACD indicator is below the zero mark and is just beginning to decrease from there.

Scenario #2: I also plan to sell USD/JPY today in the case of two consecutive tests of the price 160.23 when the MACD is in the overbought area. This will limit the pair's upward potential and lead to a market reversal downwards. A decrease can be expected towards the opposite levels of 160.11 and 159.87.

What's on the Chart:

Thin green line – entry price for buying the trading instrument;

Thick green line – presumed price level for placing Take Profit or manually securing profits, as further growth above this level is unlikely;

Thin red line – entry price for selling the trading instrument;

Thick red line – presumed price level for placing Take Profit or manually securing profits, as further decline below this level is unlikely;

MACD Indicator. When entering the market, it is important to consider the overbought and oversold zones.

Important: Beginner traders in the Forex market must be very cautious when making entry decisions. Before major fundamental reports are released, it is best to stay out of the market to avoid being caught in sharp fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without setting stop orders, you can quickly lose your entire deposit, especially if you are not using money management and are trading large volumes.

And remember, for successful trading, you need a clear trading plan similar to the one presented above. Making spontaneous trading decisions based on the current market situation is inherently a losing strategy for intraday traders.

The price test at 1.3349 occurred when the MACD indicator had risen significantly above the zero mark, limiting the pair's upward potential. For this reason, I did not buy the pound.

Despite overall pressure on the GBP/USD pair from geopolitical upheavals and further Iranian strikes on U.S. bases, traders have regained faith in Donald Trump's statements that the conflict will be resolved soon. This change in sentiment was reflected in market quotes, pushing the British pound to a slight rise against the American currency after a major sell-off last Friday.

Unfortunately, there is again no data from the UK today, so there will be significantly fewer reasons for the GBP/USD pair to continue its recovery. The absence of fresh macroeconomic data leaves the pound in a precarious position, depriving it of the support needed to bolster an upward move. The market is likely to trade within a narrow range until new drivers emerge. Attention will likely shift to external factors: the dynamics of the U.S. dollar, global market sentiment, and any statements from Trump regarding the Middle East.

Regarding the intraday strategy, I will rely more on implementing Scenarios #1 and #2.

Buying Scenarios

Scenario #1: I plan to buy the pound today upon reaching the entry point around 1.3373 (green line on the chart), with a target of 1.3407 (thicker green line on the chart). At around 1.3407, I will exit the long positions and sell in the opposite direction (anticipating a movement of 30-35 pips from the level). Expecting a rise in the pound today can only be justified within the framework of a correction. Important! Before buying, ensure that the MACD indicator is above the zero mark and is just beginning to rise from it.

Scenario #2: I also plan to buy the pound today in the case of two consecutive tests of the price 1.3354 when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. Growth can be expected towards the opposite levels of 1.3373 and 1.3407.

Selling Scenarios

Scenario #1: I plan to sell the pound today after breaking the level of 1.3354 (red line on the chart), which will lead to a rapid decline in the pair. The key target for sellers will be 1.3316, where I plan to exit the short position and immediately buy in the opposite direction (anticipating a move of 20-25 pips in the opposite direction from the level). Pressure on the pound could return at any moment. Important! Before selling, ensure that the MACD indicator is below the zero mark and is just beginning to decline from it.

Scenario #2: I also plan to sell the pound today in the case of two consecutive tests of the price 1.3373 when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a market reversal downwards. A decrease can be expected towards the opposite levels of 1.3354 and 1.3316.

What's on the Chart:

Thin green line – entry price for buying the trading instrument;

Thick green line – presumed price level for placing Take Profit or manually securing profits, as further growth above this level is unlikely;

Thin red line – entry price for selling the trading instrument;

Thick red line – presumed price level for placing Take Profit or manually securing profits, as further decline below this level is unlikely;

MACD Indicator. When entering the market, it is important to consider the overbought and oversold zones.

Important: Beginner traders in the Forex market must be very cautious when making entry decisions. Before major fundamental reports are released, it is best to stay out of the market to avoid being caught in sharp fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without setting stop orders, you can quickly lose your entire deposit, especially if you are not using money management and are trading large volumes.

And remember, for successful trading, you need a clear trading plan similar to the one presented above. Making spontaneous trading decisions based on the current market situation is inherently a losing strategy for intraday traders.