Investors, holding their breath in anticipation of the key Consumer Price Index (CPI) report, received data that generally aligned with forecasts. However, hopes for a sustainable recovery were dashed: the hawkish tilt of the Federal Reserve's monetary policy and renewed escalation in the Middle East continue to exert crushing pressure on the non-yielding asset.

Fundamental Background: "Hawkish Shock" and Geopolitics

1. CPI Data: Forecast Alignment Did Not Bring Relief

The main event on Wednesday was the publication of the US inflation data for May. The US Bureau of Labor Statistics (BLS) reported that the annual Consumer Price Index (CPI) rose to 4.2% from 3.8% in April, matching market forecasts and marking the highest level since May 2023. Month-over-month, the CPI increased by 0.5%, also in line with expectations.

Core CPI, excluding volatile food and energy prices, showed a less aggressive trend: month-over-month growth was 0.2% (forecasted at 0.3%), while year-over-year it stood at 2.9% (forecasted at 2.9%). This slight "underperformance" in the monthly core figure caused short-term optimism in the market: the US dollar weakened, and gold received a temporary reprieve, bouncing back from its lows.

However, this bounce proved to be short-lived. Investors remain convinced that inflationary pressures are unlikely to sustainably ease until the crisis between the US and Iran is resolved and oil prices return to pre-war levels.

2. The Fed: Probability of Rate Hike Increases

Despite the CPI data aligning with forecasts, it did not fundamentally change market expectations regarding the Fed's monetary policy. According to the CME FedWatch tool, traders assess the probability of at least one interest rate hike by the end of the year at around 70%.

This is a significant increase compared to 50% reported prior to last week's strong employment report (NFP).

The yield on 10-year US Treasury bonds has settled above 4.50%, making the US dollar extremely attractive in yield terms relative to gold. High interest rates increase the opportunity cost of holding gold, which pays no coupon income, while simultaneously supporting the dollar and making commodities more expensive for holders of other currencies.

3. Geopolitics: Escalation in the Persian Gulf

Contrary to expectations, the resumption of hostilities in the Middle East did not provide support for gold. Earlier in the week, the US carried out retaliatory strikes against Iran after President Donald Trump accused Tehran of downing an American Apache helicopter in the Strait of Hormuz. In response, the Iranian Revolutionary Guard Corps (IRGC) struck US military bases in Jordan, Kuwait, and Bahrain.

This paradoxical behavior can be explained by the fact that the geopolitical crisis, rather than directly increasing demand for safe-haven assets, works through the "oil channel." Rising oil prices heighten inflationary expectations, which in turn drive central banks to tighten policy, making this the primary bearish factor for gold. WTI oil prices, although corrected below $90 per barrel, remain significantly above pre-war levels.

Summary Table of Fundamental Factors

Key Events of the Week

Conclusion

Gold is under intense pressure from a combination of hawkish factors, and the short-term bounce following the CPI data did not change this picture. Strong US labor market data (NFP) and the subsequent reevaluation of Fed rate expectations (probability of a hike—70%) dealt a crushing blow to the non-yielding asset.

The technical breakdown below the 200-day moving average (4380.00) after 640 trading days above it confirmed a trend change. Gold is no longer trading in a "buy on dips" mode that has dominated the market for the past two years.

Nevertheless, structural bullish drivers (central bank purchases, currency devaluation, geopolitical fragmentation) remain in place. Economists maintain that the upward trend is merely postponed, not canceled. However, for it to resume, moderation in inflation driven by rising energy prices is necessary.

Investors should exercise extreme caution. The PPI data on Thursday and the FOMC meeting on June 16-17 will be the next determining macroeconomic tests.

An official release from the Bank of Japan states that Kazuo Ueda has been hospitalized. Furthermore, Ueda will not be able to participate in the two-day monetary policy meeting scheduled for June 15 and 16. The meeting will be led by Deputy Governor Ryozo Himino, while another deputy, Shinichi Uchida, will hold the press conference after the decision is made.

There is currently no additional information about Ueda's health; however, the central bank indicated that he is likely to remain in the medical facility for about two weeks. It is expected that the BoJ will raise interest rates by 25 basis points at its June meeting, bringing the base rate to 1%—the highest level in more than three decades.

The table below shows the percentage change of the Japanese yen against key global currencies traded on the exchanges as of Wednesday. The Japanese yen has demonstrated the strongest performance against the Australian dollar.

Ethereum (ETH/USD) is trading around $1,635, bouncing after reaching the 50% Fibonacci retracement level drawn from its low of $1,500 to its high of $1,725. Ethereum may struggle to continue its upward trend, and we could expect a further downward movement in the coming days, potentially reaching the 61.8% Fibonacci level around $1,590.

Given the prevailing bearish pressure, Ethereum is expected to return to the $1,500 level, a key level that could be seen as a decisive point for entering long positions. Alternatively, if the ETH price breaks above the 61.8% Fibonacci level, it could be viewed as a bullish signal.

Conversely, if Ethereum consolidates above the 21-period SMA at $1,655 in the coming hours, we could expect the bullish cycle to resume, potentially reaching the 2/8 Murray level around $1,750 and even the upper band of the descending trend channel around $1,785.

Ethereum could recover some of its losses if it consolidates above $1,650 in the coming days, potentially reaching the 200-period EMA around $1,925. Given that all cryptocurrencies are currently under bearish pressure, we could look for opportunities to sell below $1,655, with targets at $1,580 and ultimately around the 0/8 Murray level at $1,500.

The EUR/USD pair is trading around 1.1544, near the 21-period SMA and within the descending trend channel formed in early May. The euro has been following a bearish bias, and we believe it could continue its fall in the coming days, potentially reaching the 6/8 Murray level around 1.1474.

If the euro continues its downtrend, we could expect it to reach the resistance zone of 1.1596 or around 1.1575, leading to further selling in the coming days with a target at 1.1474.

A consolidation above 1.1545 could be seen as a buying opportunity. Should the upward momentum prevail, we expect the euro to reach the 7/8 Murray level around 1.1596 and potentially the upper band of the descending trend channel around 1.1615.

The Eagle indicator is reaching oversold levels, so we believe the euro could consolidate above 1.15 in the coming days. Given this scenario, a technical bounce above the 6/8 Murray level could be seen as a signal to enter long positions.

Our trading plan for the next few hours is to buy EUR/USD above the 21-period SMA with a target around 1.1634.

Crude oil is trading around $88.17, rebounding after reaching a low of $84.71. With this drop, crude oil filled the gap left on May 28th around $87.20. Technically, the H4 chart shows that crude oil is displaying a positive signal, and we could expect it to continue rising in the coming hours above $87.50, reaching the psychological level of $90. It could even reach the upper band of the ascending trend channel around $92.

Crude oil is likely to continue rising, as we observe the formation of a double-bottom pattern around $85.50. This pattern could indicate a positive scenario for crude oil in the coming days, so we could continue buying in the next few hours, with targets at the 200 EMA around $92.65. We could expect crude oil to fill the gap left on May 21st around $95.96.

In case crude oil encounter strong resistance around the 21-period SMA, we could expect a technical correction and consolidation, paving the way for a bullish scenario.

A decisive break above the descending trend channel and consolidation above the 200-period EMA around 92.65 could shift the outlook for crude oil, potentially reaching $95.96 and eventually the 8/8 Murray pattern around the psychological level of $100.

Our trading plan for the next few hours is to buy crude oil from the $87.50 level with targets at $90 and $92.65. The Eagle indicator is showing a positive signal, which supports our bullish strategy.

Bitcoin is trading around $61,041, reaching the 61.8% Fibonacci retracement level. We could expect a technical bounce around this area, as Bitcoin has found strong support.

If Bitcoin consolidates above $61,000 in the next few hours, we could expect it to reach the 0/8 Murray level around $62,500 and even continue rising to the 1/8 Murray level around $65,625.

Conversely, a drop below $61,000 could make Bitcoin fall to the -1/8 Murray level around $59,375. We could even expect it to touch the lower band of the descending trend channel around $57,338.

The Eagle indicator is showing oversold levels; hence, technically, Bitcoin is expected to continue bouncing above the psychological level of $60,000 in the coming days. In an extreme scenario, it could reach -1/8 Murray around the June 5th low of $59,300.

If Bitcoin consolidates above $61,000, the outlook could be positive and would be viewed as a buy signal with targets at the upper band of the descending trend channel around $68,750.

EUR/USD continues to drift gradually lower. This week, bulls have already made two attempts to halt the bearish advance, but both ended unsuccessfully. Although the Nonfarm Payrolls report does not belong to the category of geopolitical events, it triggered a sharp decline in the pair last Friday, resulting in the formation of bearish imbalance 16. At present, this imbalance serves not only as an area of interest for bears but also as a resistance zone for bulls.

On Monday, bulls failed to break through this zone, and they were equally unsuccessful on Tuesday. As for Wednesday, there was little chance of such an attempt, as active military operations resumed in the Middle East. Iran responded to U.S. strikes on its military facilities, which Washington had carried out in retaliation for the destruction of a U.S. military helicopter. Therefore, although today's bearish pressure remains relatively weak and cautious, the bears currently appear to hold the more favorable position. The technical picture supports further weakness in the euro, while the renewed escalation of the geopolitical conflict in the Middle East continues to support the U.S. dollar.

Tomorrow, the European Central Bank is highly likely to raise interest rates, yet the market has shown little reaction to this event despite having had ample opportunity to do so since the beginning of the week. It should be recalled that the ECB's intention to tighten monetary policy has been known for several days.

The objective reality is that the conflict in the Middle East shows no signs of ending, while Tehran and Washington remain unable to reach an agreement acceptable to both sides. Iran and the United States resumed exchanging missile strikes this week, and Donald Trump once again threatened Iran with complete military destruction. However, such developments are unlikely to surprise anyone anymore, as both sides have repeatedly carried out strikes while appearing more concerned about avoiding any appearance of weakness than about preserving the negotiation process. As a result, the U.S. dollar remains the preferred currency for traders due to geopolitical considerations.

The pair's movement and trader sentiment will continue to depend primarily 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, negotiations may once again be suspended in the near future.

Under current conditions, traders may continue to focus on bearish patterns. A new sell signal could emerge from bearish imbalance 16 as early as today. Nevertheless, if an agreement between Iran and the United States is eventually reached, the euro may resume its upward movement despite bearish technical patterns. Such a scenario appears unlikely in the near term, which leaves bears with considerable freedom to continue applying pressure. Market sentiment continues to shift from one side to the other, forcing traders to adjust their strategies constantly.

I would once again emphasize that the entire appreciation of the U.S. dollar during January–March was driven solely by geopolitical developments. As soon as the United States and Iran agreed to a ceasefire, bears immediately retreated, and bulls dominated trading activity for more than a month. At present, the likelihood of a comprehensive agreement is declining once again, and the market remains highly skeptical of any reports suggesting a rapid end to the conflict or a breakthrough in negotiations between Iran and the United States. Consequently, geopolitical factors continue to exert underlying pressure on EUR/USD.

The economic calendar had virtually no impact on trader sentiment on Wednesday. Only one report was released during the day that could have attracted market attention. U.S. inflation accelerated to 4.2% in May, matching market expectations. As a result, traders found little reason to react.

Bulls still have numerous reasons to remain active in 2026, and the outbreak of war in the Middle East has not reduced their number. Structurally and fundamentally, Trump's policies, which contributed to the significant weakening of the dollar last year, have not changed. In the coming months, the U.S. dollar may occasionally strengthen as investors seek safe-haven assets, but such support requires continued escalation in the Middle East. I still do not believe in a sustained bearish trend in EUR/USD. The dollar has received temporary support from the market, but what will provide bears with a long-term basis for maintaining pressure?

News Calendar for the United States and the Eurozone:

• Eurozone – ECB Interest Rate Decision (12:15 UTC).
• United States – Producer Price Index (12:30 UTC).
• United States – Initial Jobless Claims (12:30 UTC).
• Eurozone – ECB Press Conference (12:45 UTC).

The economic calendar for June 11 contains several events, with the ECB meeting undoubtedly being the most important. The economic backdrop may influence market sentiment during the second half of the day.

EUR/USD Forecast and Trading Advice:

In my view, the pair remains in the process of forming a bullish trend. The fundamental 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 at least some support.

At present, traders can only maintain existing short positions initiated from imbalance 15 while waiting for a new sell signal from imbalance 16. The decline in the pair has been prolonged for objective reasons. Without strong U.S. labor market and unemployment data, the support zone represented by imbalance 13 would most likely have held. However, that support failed, and bears now have an opportunity to continue their advance toward targets below 1.1412, the swing low of March 13.

GBP/USD has a good opportunity to continue its decline after reacting to bearish imbalance 19. However, the situation is not as straightforward as traders might prefer. Following Friday's decline triggered by the Nonfarm Payrolls report, a new bearish imbalance 20 was formed. Yesterday, the price fully filled this imbalance, and at the current pace of bullish pressure, it may be invalidated. If that happens, the bearish move will be interrupted before it has properly begun. Traders will once again be reminded of how quickly conditions can change in both the currency market and the Middle East.

At the beginning of the week, market sentiment was optimistic once again after Donald Trump stated that a deal with Iran could be signed within the next two weeks. However, as of Wednesday, Trump is talking about resuming military action against Iran and describing negotiations with Tehran as having broken down. It is difficult to determine who triggered the latest escalation and ceasefire violation in the Middle East. According to official reports, Iran destroyed a U.S. military helicopter on Tuesday, Washington responded with retaliatory strikes, and by Wednesday Tehran had launched attacks against neighboring countries allied with the United States. What comes next remains unclear.

Overall, the situation surrounding the Middle East conflict remains more positive than it was a few months ago, when the sides were engaged in full-scale warfare. Nevertheless, the geopolitical balance can shift in either direction at any moment. Over the past several weeks, we have witnessed numerous potential escalations, and only the reluctance of both sides to engage in active military operations has prevented a renewed war.

In my view, the broader trend remains bullish despite the pair's sharp declines this year. The ceasefire in the Middle East remains fragile, but it is still holding and may be extended for another 60 days. At the same time, the Strait of Hormuz remains under a dual blockade, the nuclear issue remains unresolved, and any assessment of progress in negotiations is largely based on statements from Donald Trump. Iran presents a very different picture. The situation continues to fluctuate between improvement and deterioration. At present, the market retains some confidence that an agreement can be reached, but that confidence has been steadily fading.

The technical picture is currently as follows. Bullish imbalance 18 generated a reaction, but bearish imbalance 19 eventually produced a sell signal as well. However, only two days after its formation, we are seeing bullish activity rather than bearish pressure, which does not even fully align with the current geopolitical backdrop. As a result, geopolitical developments continue to reverse price action on a regular basis, while traders often struggle to react quickly enough to conflicting news and events.

The economic calendar on Wednesday was nearly empty. The U.S. inflation report could have generated a strong market reaction if the May reading had deviated from market expectations by at least 0.1 percentage point. However, no deviation was recorded, and the market's response was therefore minimal.

The overall fundamental backdrop remains such that, in the long term, I continue to expect weakness in the U.S. dollar. Even the conflict between Iran and the United States changes little in this regard. Geopolitical tensions temporarily reminded investors of the dollar's safe-haven status, but the broader outlook for the U.S. currency remains less favorable. If the U.S. economy gains momentum in 2026, the Federal Reserve resumes its monetary tightening cycle, and the conflict between the United States and Iran becomes prolonged, then the dollar could indeed target the 1.3100–1.3000 level. However, in my opinion, the long-term outlook for the U.S. currency could not have changed because of a single positive Nonfarm Payrolls report, and the Federal Reserve has not yet signaled any readiness to tighten policy.

News Calendar for the United States and the United Kingdom:

• United States – Producer Price Index (12:30 UTC).
• United States – Initial Jobless Claims (12:30 UTC).

The economic calendar for June 11 contains two releases, neither of which I consider particularly important. The impact of the economic backdrop on market sentiment may nevertheless be noticeable during the second half of the day.

GBP/USD Forecast and Trading Advice:

The long-term outlook for the pound remains bullish, although the latest signal generated is a sell signal. Therefore, in the near term, provided geopolitical developments do not interfere, bears may continue to target the March 31 low at 1.3158. Liquidity may be taken from recent swing levels, after which bulls could regain control if the geopolitical backdrop becomes more favorable.

At present, it is difficult to imagine a quick resolution to the conflict between Iran and the United States, which limits the pound's upside potential. At the same time, the dollar continues to face periodic pressure as occasional positive signals from the Middle East continue to emerge.

Donald Trump said Iran would pay a price for dragging out peace talks. A deal could already have been struck, but Tehran is dragging its feet. Do the president's words mean that the bombing of the Islamic Republic, launched after a US helicopter was shot down, will continue? Much will depend on oil's reaction. Its response to the escalation in the Middle East has been rather odd.

Investors are so convinced a US-Iran standoff will end soon that they are demanding discounts when buying crude. Nobody wants to pay more for August-delivery barrels than they would if the Strait of Hormuz were open. At the same time, rising throughput of the world's main oil artery and reduced Chinese imports are weighing on Brent. Few seem concerned about the record drawdown in inventories.

If oil does not rise in response to further escalation, it will give the White House more political leverage. The US could return to active strikes on Iran in the hope that the oil market has adapted to a blockade of the Strait of Hormuz, that US inflation will not pick up, and that the Federal Reserve will be unable to raise interest rates.

Consumer prices in May indeed brought no surprises. Their 4.2% rise, and core inflation accelerating from 2.8% to 2.9% year-on-year, were forecast by Bloomberg analysts. The "sell the rumor, buy the fact" dynamic pushed EUR/USD higher. However, bulls are advancing northward cautiously.

The main reason is turmoil in US equities. First, stock indices fell in the largest sell?off wave since 2020, then they posted the steepest roller-coaster moves since the White House abandoned massive tariffs in 2025. Rising S&P 500 volatility has led to the closing of both equity positions and hedges. Those hedges had involved selling the greenback to insure currency risk; now the greenback is being bought.

Technically, on the daily chart, EUR/USD bounced off the lower band of the fair-value range of 1.1530–1.1680. If bulls manage to hold above the key pivot at 1.1555, the odds of a further rally toward 1.1615 and 1.1640 will increase. A break of that resistance would be a signal to

Gold and US stock indices: recent dynamics

Gold is a safe?haven asset, but over the past several years, it has behaved like a risk asset. Massive Fed monetary stimulus pushed XAU/USD to records in 2011 and 2020, and a federal funds rate cut at the end of 2025 helped the metal soar to new all?time highs. It came to be seen as a highly liquid portfolio instrument that could help meet margin requirements during equity sell-offs.

As a result, a positive correlation between gold and equity indices developed, which was broken by events in the Middle East. While the S&P 500 managed to gain about one?fifth of its value from the March low, the precious metal kept falling. Of course, it lacks the powerful drivers of blockbuster corporate earnings and the AI technology frenzy. Still, XAU/USD hasn't looked this bleak in a long time.

The decline is being aided by an unfavorable external environment. Gold pays no interest, so its price typically falls during rallies in Treasury yields. The metal is quoted in US dollars, so a rally in the USD is plainly punitive for it.

Gold and US Treasury yield dynamics

If in 2022–2023 gold was supported by central bank buying and ETF inflows, none of that is present now. Regulators made only modest purchases of bars in April after net sales in March. According to research by Standard Chartered Bank, around 270 tonnes of holdings of specialist exchange-traded funds were underwater in early June. The fall in XAU/USD pushed that figure to 298 tonnes. Capital outflows from ETFs will exacerbate selling in the spot and futures markets.

The unfavorable external backdrop and lack of demand support from bullion purchases and specialist ETFs are only part of the problem. Gold has broken long-standing relationships because of a burst bubble. At the start of 2026 it rose too quickly and began to resemble Bitcoin in its heyday. Both assets were bought simply because of their straight-line rallies — rallies that had no fundamental justification. In the end it finished as it had to: a collapse.

Technically, on the daily gold chart, the bears are preparing to resume the downtrend. A decisive break of support at the pivot level of $4,150 per ounce will be a necessary condition. That would allow adding to short positions initiated around $4,415 and $4,380.

In a joint statement published on Wednesday, the banks said the stablecoin will be issued under a trust arrangement in which all three banks will act as co-founders and a trust bank or similar institution will serve as trustee. They will create a dedicated council to develop operational standards and a governance framework. The instrument is classified as an electronic payment instrument under Japanese law and is intended for a broad range of use cases—from corporate settlements to cross-border payments.

The initiative builds on months of preparatory work and enjoys direct regulatory backing. The three banks first joined forces in October last year on a pilot project to study joint stablecoin issuance mechanisms. In November the Financial Services Agency formally supported the initiative, confirming its conformity with existing financial rules.

The project is being implemented under the FSA's "FinTech Proof-of-Concept Hub" program, which has supported fintech experiments since 2017.

It is notable that the announcement from Japan's largest banks fits into a global wave of institutional stablecoin expansion. Mastercard has integrated stablecoin settlements into its payments infrastructure. The BIS and major central banks are testing blockchain settlements with real money under Project Agor. Georgia launched a state stablecoin in partnership with Tether. The US Securities and Exchange Commission registered Paxos as the first blockchain clearing organization in the United States. The Japanese banking system now joins that list in the second-largest developed economy.

It is evident that stablecoins are rapidly evolving from crypto-trading instruments into core settlement infrastructure for global finance. Japan — known for its regulatory caution — by participating decisively tilts the debate toward a structural shift rather than a temporary trend.

Trading recommendations:

Buyers of Bitcoin are 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 return of price below that area could quickly push BTC toward $59,600, with a farther target at $58,200.

As for Ethereum, a clear hold above $1,645 would open a direct route to $1,724. The farther target is the high near $1,783; a break above that level would signal strengthening bullish sentiment and renewed buyer interest. On the downside, buyers are expected at $1,563. A fall below that level could rapidly send ETH toward $1,476, with a deeper target at $1,401.

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.

A test of the 160.44 level occurred at a time when the MACD indicator had already moved significantly above the zero line, which limited the pair's upward potential.

The Japanese yen continues to weaken against the U.S. dollar, as today's U.S. inflation data may encourage traders to continue buying USD/JPY. However, it should not be forgotten that the pair has already moved beyond the Bank of Japan's psychological level of 160 yen, so currency intervention may occur at any moment—especially in the case of further yen weakening—which could lead to a sharp decline in USD/JPY.

Regarding inflation, traders will most likely focus more on the Core CPI. To better understand inflation dynamics, this indicator is often analyzed in detail. By excluding the most volatile components such as food and energy prices, it provides a clearer picture of long-term inflation trends that are less affected by short-term fluctuations. An increase in Core CPI is also viewed as a positive signal for the U.S. dollar and a negative factor for the Japanese yen.

Regarding intraday strategy, I will primarily rely on Scenario #1 and Scenario #2.

Buy Signal

Scenario #1: I plan to buy USD/JPY today at an entry point around 160.57 (green line on the chart), targeting a rise toward 161.09 (thicker green line on the chart). At 161.09, I will exit long positions and open short positions in the opposite direction (expecting a 30–35 point move in the opposite direction from that level). A further rise in the pair today is possible in the case of strong U.S. inflation data. Important: Before buying, ensure that the MACD indicator is above the zero line and has just started moving upward from it.

Scenario #2: I also plan to buy USD/JPY if there are two consecutive tests of the 160.39 level while the MACD is in oversold territory. This would limit downward potential and trigger a reversal to the upside. In this case, a move toward 160.57 and 161.09 can be expected.

Sell Signal

Scenario #1: I plan to sell USD/JPY after a break below the 160.39 level (red line on the chart), which should lead to a rapid decline in the pair. The key downward target is 159.80, where I will exit short positions and immediately open long positions in the opposite direction (expecting a 20–25 point rebound from that level). Downward pressure on the pair may return in the case of central bank intervention. Important: Before selling, ensure that the MACD indicator is below the zero line and has just started moving downward from it.

Scenario #2: I also plan to sell USD/JPY if there are two consecutive tests of the 160.57 level while the MACD is in overbought territory. This would limit upward potential and trigger a reversal to the downside. A decline toward 160.39 and 159.80 can be expected.

What Is on the Chart:

• Thin green line – entry price for buying the instrument;
• Thick green line – projected take-profit level or area for manual profit-taking, as further upside above this level is considered unlikely;
• Thin red line – entry price for selling the instrument;
• Thick red line – projected take-profit level or area for manual profit-taking, as further downside below this level is considered unlikely;
• MACD indicator – trading decisions should be based on overbought and oversold zones.

Important: Beginner Forex traders should be extremely cautious when entering the market. Ahead of important fundamental data releases, it is best to stay out of the market to avoid sharp price volatility. If you choose to trade during news releases, always place stop-loss orders to minimize losses. Without stop-loss orders, you may quickly lose your entire deposit, especially if risk management is not applied and large position sizes are used.

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.

A test of the 1.3389 level occurred at a time when the MACD indicator was just beginning to move upward from the zero line, which confirmed a valid entry point for a long position in the pound. As a result, the pair rose by only 5 points.

The absence of new economic data from the United Kingdom that could act as a catalyst for pound movement created a kind of vacuum, where traders preferred to remain on the sidelines. This resulted in a relatively narrow trading range, with the pair fluctuating within a few points and showing no clearly defined trend.

Next, we are awaiting the release of U.S. Consumer Price Index (CPI) data and Core CPI excluding food and energy. The Consumer Price Index is one of the key macroeconomic indicators reflecting price dynamics across a broad range of goods and services purchased by households. Its rise signals inflationary pressures in the economy, while a decline may indicate deflation. In terms of monetary policy, rising CPI often prompts the Federal Reserve to tighten policy, including raising interest rates. The projected increase in both headline CPI and core CPI is an important factor supporting the U.S. dollar.

Regarding intraday strategy, I will primarily rely on Scenario #1 and Scenario #2.

Buy Signal

Scenario #1: I plan to buy the pound today at an entry point around 1.3404 (green line on the chart), targeting a rise toward 1.3451 (thicker green line on the chart). At 1.3451, I will exit long positions and open short positions in the opposite direction (expecting a 30–35 point move in the opposite direction from that level). Pound appreciation today can only be expected in the case of weak U.S. data. Important: Before buying, ensure that the MACD indicator is above the zero line and has just started moving upward from it.

Scenario #2: I also plan to buy the pound if there are two consecutive tests of the 1.3377 level while the MACD is in oversold territory. This would limit downward potential and trigger a reversal to the upside. In this case, a move toward 1.3404 and 1.3451 can be expected.

Sell Signal

Scenario #1: I plan to sell the pound after a break below the 1.3377 level (red line on the chart), which should lead to a rapid decline in the pair. The key downward target is 1.3331, where I will exit short positions and immediately open long positions in the opposite direction (expecting a 20–25 point rebound from that level). Selling pressure may return in the case of a sharp increase in U.S. inflation. Important: Before selling, ensure that the MACD indicator is below the zero line and has just started moving downward from it.

Scenario #2: I also plan to sell the pound if there are two consecutive tests of the 1.3404 level while the MACD is in overbought territory. This would limit upward potential and trigger a reversal to the downside. A decline toward 1.3377 and 1.3331 can be expected.

What Is on the Chart:

• Thin green line – entry price for buying the instrument;
• Thick green line – projected take-profit level or area for manual profit-taking, as further upside above this level is considered unlikely;
• Thin red line – entry price for selling the instrument;
• Thick red line – projected take-profit level or area for manual profit-taking, as further downside below this level is considered unlikely;
• MACD indicator – trading decisions should be based on overbought and oversold zones.

Important: Beginner Forex traders should be extremely cautious when entering the market. Ahead of major fundamental data releases, it is best to stay out of the market to avoid sharp volatility. If you choose to trade during news releases, always place stop-loss orders to minimize losses. Without stop-loss orders, you may quickly lose your entire deposit, especially if risk management is not applied and large position sizes are used.

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.

A test of the 1.1556 level occurred at a time when the MACD indicator had already moved significantly above the zero line, which limited the pair's upward potential. The second test of 1.1556 led to the execution of Scenario #2 for selling the euro, but no major downward movement followed.

Next, we are waiting for the release of the U.S. Consumer Price Index (CPI) and the Core CPI excluding volatile components such as food and energy. Both indicators are expected to show positive momentum, which traditionally supports the U.S. dollar. However, not only the absolute level of inflation matters, but also its changes compared to previous reporting periods. A sustained acceleration in inflation will be interpreted as a signal for tighter monetary policy, which would support the dollar.

It is also worth recalling recent statements from Federal Reserve representatives, which overall point toward a more hawkish stance in the future. If these expectations are not confirmed, the dollar may weaken significantly against the euro.

Regarding intraday strategy, I will rely mainly on the implementation of Scenario #1 and Scenario #2.

Buy Signal

Scenario #1: Today, euro purchases can be considered at a price level around 1.1562 (green line on the chart), targeting a rise toward 1.1594. At 1.1594, I plan to exit the market and also consider short positions in the opposite direction, targeting a 30–35 point move from the entry point. Further euro growth will only be possible in the case of weak U.S. data. Important: Before buying, ensure that the MACD indicator is above the zero line and has just started moving upward from it.

Scenario #2: Euro purchases may also be considered after two consecutive tests of the 1.1544 level, while the MACD indicator is in oversold territory. This would limit downward potential and trigger a reversal to the upside. In this case, a rise toward the opposite levels of 1.1562 and 1.1594 can be expected.

Sell Signal

Scenario #1: I plan to sell the euro after reaching the 1.1544 level (red line on the chart), targeting 1.1515, where I intend to exit the market and immediately open a buy position in the opposite direction (expecting a 20–25 point rebound). Selling pressure may return in the case of a sharp increase in inflation. Important: Before selling, ensure that the MACD indicator is below the zero line and has just started moving downward from it.

Scenario #2: Euro selling may also be considered after two consecutive tests of the 1.1562 level, while the MACD indicator is in overbought territory. This would limit upward potential and trigger a reversal to the downside. A decline toward 1.1544 and 1.1515 may be expected.

What Is on the Chart:

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

Important: Beginner Forex traders should be extremely cautious when entering the market. Ahead of important 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 use stop-loss orders to minimize losses. Without stop-loss orders, you may quickly lose your entire deposit, especially if risk management is not applied and large position sizes are used.

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

Next, we are expecting the release of U.S. Consumer Price Index (CPI) data and the Core CPI excluding food and energy prices. These are highly important indicators for the Federal Reserve and traders. Despite expectations of an increase, market reaction may be mixed. If the figures come in above forecasts, the dollar is likely to strengthen, giving traders confidence in further interest rate hikes by the Federal Reserve. However, if inflation comes in below expectations, it may raise concerns about slowing economic growth, which in turn could lead to a weakening of the U.S. dollar.

The key factor will not only be the absolute level of the indicators but also their dynamics compared to previous readings. A sustained acceleration in inflation will signal tighter monetary policy, supporting the dollar. Conversely, signs of slowing inflationary pressure may push the dollar lower, as the market begins to price in the possibility of future rate cuts.

In the case of strong data, I will rely on the Momentum strategy. If there is no clear market reaction to the data, I will continue using the Mean Reversion strategy.

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

For EUR/USD:

• Buy on a breakout above 1.1570, targeting 1.1600 and 1.1625;
• Sell on a breakout below 1.1540, targeting 1.1505 and 1.1480;

For GBP/USD:

• Buy on a breakout above 1.3405, targeting 1.3441 and 1.3478;
• Sell on a breakout below 1.3380, targeting 1.3360 and 1.3340;

For USD/JPY:

• Buy on a breakout above 160.60, targeting 160.90 and 161.17;
• Sell on a breakout below 160.30, targeting 160.02 and 159.80;

Mean Reversion Strategy (Reversion to the Mean) for the Second Half of the Day:

For EUR/USD:

• Look for sell opportunities after a false breakout above 1.1576, followed by a move back below this level;
• Look for buy opportunities after a false breakout below 1.1532, followed by a move back above this level;

For GBP/USD:

• Look for sell opportunities after a false breakout above 1.3415, followed by a move back below this level;
• Look for buy opportunities after a false breakout below 1.3360, followed by a move back above this level;

For AUD/USD:

• Look for sell opportunities after a false breakout above 0.7046, followed by a move back below this level;
• Look for buy opportunities after a false breakout below 0.6994, followed by a move back above this level;

For USD/CAD:

• Look for sell opportunities after a false breakout above 1.3960, followed by a move back below this level;
• Look for buy opportunities after a false breakout below 1.3900, followed by a move back above this level;

Gold (XAU/USD) continues its decline toward the March low. The escalation of military confrontation between the United States and Iran is increasing inflation risks and supporting expectations of monetary policy tightening by central banks, which is driving outflows from the non-yielding precious metal.

Additional downward pressure is being generated by technical selling following the break below the key 200-day Simple Moving Average (SMA). At the same time, the current decline is largely ignoring the weakening of the U.S. dollar, which would typically provide support to commodity assets.On Tuesday, the United States carried out strikes on Iranian targets, stating that the actions were taken in self-defense following an incident involving a downed Apache helicopter in the Strait of Hormuz. In response, the Islamic Revolutionary Guard Corps (IRGC) reported attacks on military facilities in Jordan, Kuwait, and Bahrain, where U.S. forces are stationed, and warned of stronger measures if U.S. pressure continues. Iranian Foreign Minister Abbas Araghchi also emphasized that any threats or attacks would not go unanswered, urging the United States to leave the region to avoid further escalation. Against this backdrop, an elevated geopolitical risk premium persists, helping oil prices remain above recently reached two-month lows.According to the CME Group FedWatch Tool, the probability of a Federal Reserve rate hike by the end of the year is estimated by the market at around 75%, amid concerns over persistently high inflation driven by expensive energy prices. At the same time, market participants are taking a wait-and-see approach toward the U.S. dollar, preferring to wait for the upcoming inflation data release. The upcoming Consumer Price Index (CPI) report will be a key factor in shaping the Federal Reserve's monetary policy trajectory and may therefore set the direction for the dollar's performance. Against this backdrop, fundamental factors continue to exert pressure on gold prices.

From a technical perspective, the recent break below the 200-day Simple Moving Average (SMA) has created favorable conditions for bears. Moreover, consolidation below the 200-day SMA reinforces the negative short-term outlook and increases the likelihood of further price declines. Oscillators remain negative, while the Relative Strength Index (RSI) is already in oversold territory. Taken together, these factors leave gold vulnerable to further downward movement, with the potential for a retest of the March low around $4,100. The nearest resistance is located at 4,260, followed by the 200-day EMA and SMA.

Gold (XAU/USD) continues to decline toward its March low. Additional downward pressure is being generated by technical selling following the break below the key 200-day Simple Moving Average (SMA).

Moreover, consolidation below the 200-day SMA reinforces the negative short-term outlook and increases the likelihood of further weakness. At the same time, the daily Relative Strength Index (RSI 14) has moved into negative territory and remains near the 28 level, indicating oversold conditions, while the MACD remains deeply in negative territory, confirming the dominance of bearish momentum.

Taken together, these factors leave gold vulnerable to further declines, with the potential for a retest of the March low near $4,100.

In the event of a corrective rebound, the nearest resistance level is located at $4,260, followed by the area of the 200-day EMA and the 200-day SMA. A break above the latter level, near $4,444, would ease the current downward pressure imposed by the descending channel and open the way for a move toward the psychological level of $4,500, followed by the 50-day SMA near $4,630.

Overall, New Zealand's key economic indicators, such as retail sales and international trade, continue to show stability. However, first-quarter construction sector data released last week altered the overall picture. A significant 3.5% quarter-on-quarter decline in real construction activity came as a surprise and contradicted expectations of substantial growth.

As a result, BNZ revised its first-quarter GDP forecast lower to 0.7% quarter-on-quarter from the previous estimate of 0.9%. There is a risk of further downward revisions if the upcoming manufacturing, wholesale trade, and services sector data fail to show positive momentum.

Against this backdrop, the sharp increase in residential building permits issued in April stands out. The figure rose by 10.9% month-on-month and by an impressive 52.7% year-on-year. This result was an unexpected positive surprise and contrasted sharply with the data on completed construction activity.

It is worth recalling that the latest RBNZ meeting revealed divisions among Monetary Policy Committee members, with three of the seven members voting in favor of a rate hike. The market is currently pricing in a high probability of three interest rate increases before the end of the year. Therefore, the GDP data may either reinforce these expectations and support the New Zealand dollar (kiwi) or, conversely, strengthen negative sentiment.

Today's key event will be the release of the U.S. inflation report for May. Forecasts point to an increase in headline inflation from 3.8% to 4.2% and in core inflation from 2.8% to 2.9%. If these expectations are confirmed, it would provide additional support for U.S. dollar buyers.

However, there is an important nuance. The yield on 5-year Treasury Inflation-Protected Securities (TIPS) has been declining steadily and has reached a three-month low. This may indicate that businesses do not expect inflation to accelerate as significantly as current forecasts suggest. If this assumption proves correct, the U.S. dollar could weaken substantially by the end of the day, creating room for a corrective advance in the New Zealand dollar. For now, this remains a hypothesis, but one that has a reasonable basis.

The net short position in the NZD decreased by $321 million during the reporting week to -$1.67 billion. At the same time, the estimated fair value unexpectedly turned higher, increasing the likelihood of a corrective rise in NZD/USD.

A week ago, we identified the 0.5780–0.5790 level as a target, and that objective has been achieved. As of Wednesday morning, we believe the probability of an upward correction has increased. The kiwi may still decline further toward 0.5676 after making a second attempt to break below support at 0.5780–0.5790. However, considering the behavior of the estimated fair value, we believe a move toward the midpoint of the sideways range that has contained the pair since early April is more likely. In this regard, the 0.5870–0.5890 resistance zone may serve as a potential upward target. Fundamental reasons for a sustained rally remain limited, but the probability of such a corrective rebound has increased noticeably.

The wave structure on the hourly chart remains straightforward at the moment. 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 advance only if Iran and the United States sign an interim agreement, stop violating the terms of the ceasefire, and the Strait of Hormuz is reopened. Without these developments, further appreciation of the euro will be extremely difficult.

No important economic data were released on Tuesday, and traders spent the entire day reacting to geopolitical headlines that alternately pointed to a ceasefire and a potential agreement, or to renewed escalation and a breakdown in negotiations. As a result, Germany's industrial production and trade balance reports, as well as the U.S. existing home sales report, had virtually no chance of attracting traders' attention.

I would highlight two key developments on Tuesday. First, in the morning, Donald Trump once again stated that Iran was prepared to hand over its nuclear weapons to the United States and commit not to enrich uranium in the future. According to the U.S. president, a deal with Iran is close, and the Strait of Hormuz could reopen within two weeks. However, later in the day, reports emerged that Iran had shot down a U.S. military helicopter near the Strait of Hormuz, while overnight U.S. forces carried out strikes on Iranian facilities in the same area. As a result, the sides once again exchanged strikes and threats while simultaneously preparing for another round of negotiations, which are currently being conducted exclusively through Pakistani mediation. Consequently, the market was forced to swing sharply in both directions throughout the day. Today, bulls are once again on the offensive as the "ceasefire" remains in place and negotiations continue.

On the 4-hour chart, the pair rebounded from the 38.2% Fibonacci retracement level at 1.1667 and resumed its decline within a downward trend channel. Consolidation below the 23.6% Fibonacci level at 1.1569 suggests a continuation of the decline toward the next corrective 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 over the past ten weeks the situation has gradually stabilized amid the suspension of hostilities in the Middle East. The total number of long positions held by speculators now stands at 235,000, compared with 186,000 short positions. The gap is once again widening in favor of bulls.

Overall, from a long-term perspective, major market participants continue to view the euro favorably. Naturally, various global developments—which have been abundant in recent years—continue to influence investor sentiment. At present, the market's attention remains firmly focused on the Middle East, where the conflict has only been paused rather than resolved. Therefore, in the near term, movements in the euro and the dollar will depend less on Federal Reserve or ECB monetary policy and economic data, and more on developments in Iran.

News 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 Tips:

Short positions were possible following a rebound from the 1.1578 level, targeting 1.1514. New short positions may again be considered on another rebound from 1.1578 with the same target. Long positions could be opened following a rebound from 1.1514, targeting 1.1578 and 1.1630. The first target has already been reached. New long positions may be considered after a close above 1.1578.

Fibonacci retracement 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.

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

The news background on Tuesday was weak in terms of economic events but strong from a geopolitical perspective. As I have already noted, all intraday movements were driven by geopolitical developments related to the conflict in the Middle East. As of Wednesday morning, further escalation of the conflict had been avoided, while the parties once again exchanged strikes while maintaining the ceasefire. The situation may repeat itself today, as similar developments have occurred every few days. However, with no new strikes reported so far, traders have shifted their attention to the U.S. Consumer Price Index, which will be released later today. Forecasts suggest that inflation in the United States will accelerate to 4.2% year-over-year, but traders are more concerned with the actual reading than with forecasts. The figure could come in significantly above or below expectations. A higher-than-expected reading could trigger renewed selling pressure from bears, while a weaker reading would support bulls. At present, the FOMC is not considering further monetary policy tightening, so only a substantial acceleration in inflation is likely to force the Committee to reconsider its stance.

On the 4-hour chart, GBP/USD rebounded from the 23.6% Fibonacci retracement level of 1.3327 and reversed in favor of the pound. Therefore, the pair may return to the 1.3482–1.3514 resistance level in the near term. Consolidation below 1.3327 would favor a continuation of the decline toward the 0.0% Fibonacci level at 1.3159. 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 currently stands at approximately 53,000 versus 110,000 contracts. Bears have dominated the market in recent months, which is unsurprising given geopolitical tensions in the Middle East and the political crisis in the United Kingdom. The bears' advantage currently exceeds a two-to-one ratio.

I still do not believe in a sustained bearish trend for the pound, but in the near term everything will depend not on economic indicators, Trump's trade policy, or central bank monetary policy, but on the duration, scale, and consequences of the conflict in the Middle East. In recent weeks, the market has adjusted to expectations of a prolonged conflict, but the latest developments suggest that a ceasefire may still be reached, although it is unlikely to be quick or easy.

News Calendar for the United States and the United Kingdom:

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

The economic calendar for June 10 contains only one significant event. The impact of the economic backdrop on market sentiment may be noticeable during the second half of the day.

GBP/USD Forecast and Trading Tips:

Short positions were possible following a rebound from the 1.3408 level on the hourly chart, targeting the 1.3349–1.3355 level. That target was nearly reached yesterday. New short positions may be considered on another rebound from 1.3408 or after a close below the 1.3349–1.3355 level. Long positions may be considered today following a rebound from the 1.3349–1.3355 support level, targeting 1.3408. Alternatively, long positions may be considered after a close above 1.3408, targeting the 1.3454–1.3466 level.

Fibonacci retracement 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 volatility dynamics

In reality, the root cause is capital rotation. Investors are locking in profits after the blistering rally in chip stocks and reallocating into other assets — chief among them cash set aside for the imminent SpaceX IPO. That float risks becoming the largest in history.

In early June, the Philadelphia Semiconductor Index was up about 96% since January. Baird Private Wealth Management estimates that profit-taking will trim that advance to about 80%. Once chatter about stretched bubbles starts circulating, investors dump names with overstretched fundamentals: anything with a forward P/E above 30 becomes a selling candidate.

Portfolio diversification is not limited to tech. The consumer sector sits in the crosshairs — it would suffer most if inflation remains elevated and the Fed tightens policy — and investors are instead buying equities that pay high dividends.

It is unlikely the S&P 500's slide was driven primarily by events in the Middle East. There has been an escalation — Iran shot down a US helicopter, the US responded with strikes on 20 targets, and Tehran retaliated against other regional states. Iran says US forces must leave the Middle East to ensure its security.

Yet oil did not rally on the escalation. Brent continued the post-truce decline. The market may have adapted to a closed Strait of Hormuz. If so, that would free US President Donald Trump to pursue an aggressive campaign against Tehran without fearing a spike in oil and a jump in US inflation.

Equities continue to live in a world of high earnings and a resilient economy. That said, rising risks of interest rate hikes by the Fed are dampening bulls' bravado on the broad index.

Technically, the S&P 500 is retracing toward its uptrend on the daily chart. This allowed traders to open long positions at 7,300, which can be increased on moves above 7,540 and 7,480.

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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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Iran immediately responded: the IRGC announced drone strikes on the headquarters of the US Fifth Fleet in Bahrain, as well as on American military facilities in Jordan and Kuwait. Explosions were also reported on Qeshm Island and along Iran's southern coast.

Despite all that is happening, Trump characterized the retaliation as "very strong and very powerful"; however, the US Central Command chose its words carefully—the operation was described as a "proportional response," signaling Washington's desire to contain the confrontation without transitioning to a full-scale renewal of war.

Iranian Foreign Minister Araghchi stated that the country would not leave any attack unanswered. However, by evening, both Iran and Israel announced a cessation of mutual strikes, with the caveat that this eased market pressure and led to a slight rebound in risk assets. Netanyahu promised to refrain from firing at Iran if it does not strike again, although he confirmed the intention to continue operations against Hezbollah in Lebanon. Iranian military command warned that if strikes in Lebanon continue, the response would be "much harsher and more devastating."

In addition to developments in the Middle East, the second important event today will be the US Bureau of Labor Statistics' report on the Consumer Price Index (CPI) for May. The consensus forecast suggests a CPI increase of 4.2% year-over-year compared to 3.8% in April—this would be the highest figure since April 2023 and significantly above the average of 2.8% over the last 12 months. Month-over-month, a growth of 0.5% is expected compared to 0.6% in April. Core inflation, excluding food and energy, is projected to rise to 2.9% year-over-year from 2.8% in April, while month-over-month is expected to slow to 0.3% from 0.4%.

It is worth noting that this report is being released at an extremely tense moment. The May Non-Farm Payrolls report, released last Friday, showed employment growth more than double expectations—causing the euro, pound, and other assets to plummet against the dollar—and markets have fully priced in a Federal Reserve rate hike by the end of the year. According to the CME FedWatch tool, the probability of at least one rate hike in the US in 2026 exceeds 70%. If the CPI data comes in above consensus, the new Fed Chairman, Kevin Warsh, will find himself in a situation where, at his first meeting on June 16–17, he will need to send strong signals to the market. This is a positive scenario for the dollar.

As for the current technical picture of EUR/USD, bulls need to consider how to reclaim the 1.1555 level. Only this will allow them to aim for a test at 1.1580. From there, one could reach 1.1600, but doing this without support from major players will be quite problematic. The furthest target will be the high of 1.1625. If the trading instrument declines toward 1.1530, I expect serious action from major buyers. If no one is there, it would be prudent to wait for a new low of 1.1505 or open long positions from 1.1480.

As for the current technical picture of GBP/USD, pound buyers need to reclaim the nearest resistance at 1.3390. Only this will allow them to aim for 1.3415, which will be quite difficult to break through. The furthest target will be the area of 1.3440. If the pair falls, bearish traders will try to gain control over 1.3360. If they succeed, a breakout of this range will deliver a serious blow to bullish positions and push GBPUSD down to a low of 1.3330, with the prospect of reaching 1.3299.

As always, the housing market provided a pleasant surprise. Existing home sales in May accelerated to their highest level in a year—4.17 million on an annualized basis. The median price rose by 1.3% year-over-year to $429,300, and the number of listed properties slightly increased to 1.55 million. The structure of buyers is indicative: first-time buyers accounted for 35% of transactions—the highest percentage since June 2020. This suggests that the market is gradually returning to a healthier, organic model of demand—despite mortgage rates remaining above 6% for the fourth consecutive year.

The trade balance also pleased. The April deficit shrank by 1.2% to $55.9 billion, slightly better than the consensus forecast of $56.1 billion. The main driver was oil exports—crude oil shipments increased by 60% over the month. The war with Iran and the closure of the Strait of Hormuz redirected global demand for American energy resources, and the US is actively taking advantage of this window of opportunity. Imports rose by 2%—primarily due to computers and semiconductors, reflecting the ongoing investment boom in data center construction.

As I noted earlier, the shadow over this generally positive picture is cast by the NFIB Small Business Optimism Index. In May, it fell by 0.6 points to 95.3—the lowest since October 2024. It is worth noting that after Trump's re-election, the index sharply soared to a six-year high in December 2024; however, it has steadily retreated since then. Now, all post-election optimism is effectively neutralized. Small businesses are a sensitive barometer of the real state of the economy: they are the first to feel rising costs, higher interest rates, and weakening consumer demand.

In aggregate, this data paints a picture of the American economy that is holding on, but with increasing difficulty. Large businesses and exporters are benefiting from the geopolitical situation, and the housing market has found a new equilibrium. However, small businesses—the foundation of employment and consumer activity—are losing confidence. Against the backdrop of today's anticipated May CPI, projected at 4.2%, and the first Federal Reserve meeting under Warsh's leadership next week, this combination of signals intensifies the central bank's dilemma: the economy is not broken yet, but it is cracking—and inflation continues to rise.

The price test at 160.23 coincided with the moment when the MACD indicator was just beginning to move upward from the zero mark, confirming the correct entry point to buy dollars. As a result, the pair rose toward the target level of 160.39.

A new chapter in Iranian-American relations, marked by another act of aggression from the United States against Iran, has not gone unnoticed on the international stage. The rapidly unfolding events once again demonstrated how geopolitical tensions can directly influence global financial markets, dictating the rules for currency pairs. In this turbulent environment, the US dollar, traditionally a safe haven for investors during periods of uncertainty, showed noticeable strengthening. The Japanese yen, often correlated with global risks, experienced the opposite pressure, showing a significant decline.

However, many experts monitoring the situation at the Bank of Japan anticipate at least two increases in the key interest rate this year, the first of which will occur next week. Many believe that the war in Iran could provoke a sustained spike in inflation, forcing the central bank to act more aggressively. This is currently the only factor preventing the yen from further decline.

As for 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 160.44 (green line on the chart), with a target of 160.59 (thicker green line on the chart). Around 160.59, I plan to exit the long positions and open short positions in the opposite direction (expecting a movement of 30-35 pips in the opposite direction from the level). It is best to return to buying the pair on corrections and significant dips in USD/JPY. Important! Before buying, ensure that the MACD indicator is above the zero mark and is just beginning its rise from there.

Scenario #2: I also plan to buy USD/JPY today in case of two consecutive tests of the price at 160.32, at a time when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. One can expect growth to the opposite levels of 160.44 and 160.59.

Selling Scenarios

Scenario #1: I plan to sell USD/JPY today only after updating the level of 160.32 (red line on the chart), which will lead to a rapid decline in the pair. The key target for sellers will be 160.09, where I plan to exit shorts and open longs immediately in the opposite direction (expecting a move of 20-25 pips in the opposite direction from the level). Sellers can return at any moment; it only takes a hint from the central bank. Important! Before selling, ensure that the MACD indicator is below the zero mark and is just beginning its decline from there.

Scenario #2: I also plan to sell USD/JPY today in case of two consecutive tests of the price at 160.44, at a time when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a downward market reversal. One can expect a decrease to the opposite levels of 160.32 and 160.09.

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.