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.

The price test at 1.3404 coincided with the moment when the MACD indicator had moved significantly above the zero mark, limiting the pair's upward potential. For this reason, I did not buy the pound. The second test at 1.3404 occurred while the MACD was in the overbought area, prompting the implementation of scenario #2 to sell the pound. As a result, the pair decreased by 40 pips.

Another wave of military attacks from the US and Iran has put pressure on risk assets, which, in turn, prompted purchases of the US dollar. The geopolitical tension in the Persian Gulf will inevitably continue to affect global financial markets, creating uncertainty and prompting traders to seek refuge in safe-haven assets. The British pound, as the currency of a country whose economy is closely tied to international trade and energy resources, is highly susceptible to global events.

Today, the lack of fresh data on economic activity in the UK will not help the pound rise. Without clear signals of growth or stabilization in the British economy, traders struggle to identify substantial arguments for opening long positions on the GBP/USD pair. As is known, the currency market reacts sensitively to macroeconomic indicators, and their scarcity creates uncertainty, which typically weighs on risk assets, including the pound.

In this situation, the focus naturally shifts to geopolitical risks, which are currently concentrated in the Middle East. Any escalation of tensions in this region can trigger a new flight of investors from risks, leading to a strengthening of safe-haven assets.

As for the intraday strategy, I will rely more on implementing scenarios #1 and #2.

Buying Scenarios

Scenario #1: I plan to buy the pound today at the entry point around 1.3389 (green line on the chart), with a target of 1.3409 (thicker green line on the chart). Around 1.3409, 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). One can only expect growth in the pound today within the framework of a correction. 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 the pound today in case of two consecutive tests of the price at 1.3377, 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 1.3389 and 1.3409.

Selling Scenarios

Scenario #1: I plan to sell the pound today after updating the level at 1.3377 (red line on the chart), which will trigger a rapid decline in the pair. The key target for sellers will be 1.3352, 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). Pressure on the pound can return at any moment. 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 the pound today in case of two consecutive tests of the price at 1.3389, 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 1.3377 and 1.3352.

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 1.1573 coincided with the moment when the MACD indicator had moved significantly above the zero mark, limiting the pair's upward potential. For this reason, I did not buy euros. The second test at 1.1573 occurred while the MACD was in the overbought area, prompting the implementation of scenario #2 for selling euros. As a result, the pair decreased by 40 pips.

Recent events in the Middle East, related to the deterioration of relations between the US and Iran, once again caused a noticeable surge in the US dollar. In particular, reports of US strikes on Iran directly affected the dynamics of the currency pair. Further developments require close attention from market participants. Escalation of the conflict or, conversely, diplomatic resolution will have a significant impact on the foreign exchange market, including the European currency.

Today, the first half of the day will be marked only by the publication of Italy's macroeconomic data on changes in industrial production volume. Analysts agree that the results will likely not provide significant support to the European currency. Statistics reflecting the state of one of the key sectors of the Italian economy are traditionally closely monitored by market participants but have little influence on the direction of the euro.

As for the intraday strategy, I will rely more on implementing scenarios #1 and #2.

Buying scenarios

Scenario #1: Today, I can buy euros when the price reaches around 1.1556 (green line on the chart), with a target to reach 1.1576. At 1.1576, I plan to exit the market and sell euros in the opposite direction, expecting a move of 30-35 pips from the entry point. One can expect growth in the euro only after good data from the eurozone. 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 euros today in case of two consecutive tests of the price at 1.1540, 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 1.1556 and 1.1576.

Selling scenarios

Scenario #1: I plan to sell euros once the price reaches 1.1540 (the red line on the chart). The target will be 1.1522, where I plan to exit the market and immediately buy in the opposite direction (expecting a move of 20-25 pips in the opposite direction from that level). Pressure on the pair today will only return in case of very weak data. 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 euros today in case of two consecutive tests of the price at 1.1556, 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 1.1540 and 1.1522.

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.

Markets were again under pressure, the fourth down day in five. The MSCI Asia Pacific index fell by 1.6%, and South Korea's KOSPI lost more than 4%. US index futures are down about 0.2% today after Tuesday's volatile session on Wall Street. Gold slid by roughly 2%, dipping below $4,200/oz. The 10-year US Treasury yield rose by two basis points to 4.53%. Two-year yields are at their highest level in more than a year.

All eyes are on tonight's release of US May CPI data. The consensus calls for headline CPI to rise by 4.2% year-on-year (vs. 3.8% in April). Core inflation is expected at 2.9% vs. 2.8% a month earlier. For new Fed Chair Kevin Warsh, who will preside over his first FOMC meeting on June 16–17, the CPI print will be the first serious policy test. If the number comes in above expectations, it will be extremely difficult to convince markets that interest rate cuts remain possible.

The bond market is already drawing its own conclusions. Traders are actively positioning for several Fed hikes over the coming months; some see a move as early as September. National Australia Bank said yesterday the FOMC will likely drop language hinting at easing next week, and Warsh risks taking a firmer stance than the market expects. The longer the economy remains resilient amid rising inflation, the greater the pressure on the Fed to act.

Geopolitics is adding to the nerves. The US carried out fresh airstrikes on Iran after an American military helicopter was downed. Oil barely reacted — Brent partially recouped Tuesday's losses to settle at near $92. However, the Strait of Hormuz remains de facto blockaded, and talks are stalled. For the Fed, this means the energy price shock will not disappear in the coming months, narrowing room for a policy pause with every new headline.

Technically, the S&P 500 analysis suggests that the immediate task for buyers today is to overcome the resistance level of $7,355. Doing so would confirm upside and open the path to $7,381. Maintaining control above $7,404 would further strengthen buyers' positions. On the downside, buyers need to defend $7,339. A break below that level would likely push the index back to $7,319 and open the way to $7,300.

News that American forces launched strikes on Iran, shortly after President Donald Trump accused Tehran of downing an American military helicopter off the coast of Oman, led to a decline in risk assets and a strengthening of the U.S. dollar. The market's reaction was immediate: the euro, British pound, and Australian dollar, already under pressure from uncertainty, declined sharply, while the U.S. dollar, traditionally considered a safe haven in times of geopolitical tension, received new impetus for growth. Clearly, the tension in the Middle East, fueled by another round of escalation between Washington and Tehran, could not help but affect global economic stability.

Today, in the first half of the day, data on changes in Italy's industrial production, a key indicator of the country's economy, is expected to be released. These figures, published by the Italian National Institute of Statistics (ISTAT), could have a significant impact on the national currency's exchange rate and on trader sentiment.

Preliminary analyst expectations suggest that industrial production in Italy may have grown by a minimal 0.1% in April this year, amid mixed signals: on the one hand, persistently high inflation and rising energy costs could be putting pressure on production costs and slowing growth rates. On the other hand, steady demand from key trading partners, including those in the Eurozone, could support production volumes. However, only data that significantly deviates from forecasts will influence the euro's exchange rate.

The lack of significant macroeconomic data from the United Kingdom today means the GBP/USD pair lacks internal catalysts for a substantial recovery. The absence of fresh macroeconomic indicators leaves the British pound hanging, depriving it of the essential support needed to reinforce an upward move. The market will likely trade within a narrow range until new drivers emerge, with the primary focus shifting to external factors: the dynamics of the U.S. dollar, global market sentiment, and any statements from Trump regarding the Middle East.

The geopolitical situation in this region remains the key factor shaping sentiment in the currency market, thereby influencing the dynamics of major currency pairs. In such a situation, without local news capable of sustaining interest in the pound, the GBP/USD pair is likely to continue moving within the current trading range or show slight fluctuations, reacting only to external shocks.

If the data aligns with analysts' expectations, it is advisable to act based on the Mean Reversion strategy. If the data is significantly above or below analysts' expectations, the Momentum strategy should be employed.

Momentum Strategy (Breakout):

For the EUR/USD Pair:

• Buying on a breakout of 1.1556 may lead to an increase in the euro to around 1.1579 and 1.1601;
• Selling on a breakout of 1.1529 may lead to a decline in the euro to around 1.1506 and 1.1480;

For the GBP/USD Pair:

• Buying on a breakout of 1.3400 may lead to an increase in the pound to around 1.3435 and 1.3471;
• Selling on a breakout of 1.3370 may lead to a decline in the pound to around 1.3336 and 1.3307;

For the USD/JPY Pair:

• Buying on a breakout of 160.43 may lead to an increase in the dollar to around 160.67 and 160.91;
• Selling on a breakout of 160.24 may lead to a sell-off of the dollar to around 160.02 and 159.83;

Mean Reversion Strategy (Return):

For the EUR/USD Pair:

• I will look for sell opportunities after an unsuccessful breakout above 1.1559, returning below this level;
• I will look for buy opportunities after an unsuccessful breakout below 1.1530, returning to this level;

For the GBP/USD Pair:

• I will look for sell opportunities after an unsuccessful breakout above 1.3397, returning below this level;
• I will look for buy opportunities after an unsuccessful breakout below 1.3361, returning to this level;

For the AUD/USD Pair:

• I will look for sell opportunities after an unsuccessful breakout above 0.7039, returning below this level;
• I will look for buy opportunities after an unsuccessful breakout below 0.7015, returning to this level;

For the USD/CAD Pair:

• I will look for sell opportunities after an unsuccessful breakout above 1.3960, returning below this level;
• I will look for buy opportunities after an unsuccessful breakout below 1.3938, returning to this level;

Any signs of growth and correction are immediately perceived by traders as reasons to sell.

But there is also a positive aspect. According to CryptoQuant, the share of Bitcoin supply that is at a loss on a 7-day moving average has reached 50%—the highest level in 2026. This means that half of all coins in circulation are now held by holders who bought them at prices higher than the current one. Historically, such levels above 50% have coincided with periods of market capitulation: the moment when selling pressure begins to wane because everyone who wanted and could realize a loss has already done so. Simply put, there are no sellers left—and the market begins to find a bottom.

The signal appeared in a context that makes it particularly significant. After four weeks of continuous outflows from Bitcoin ETFs, the market lost $5.4 billion in institutional capital. Bitcoin has broken below $60,000 and is targeting $53,000—the average purchase price for investors, which the CEO of CryptoQuant has termed the historical point of completion for bearish cycles. Strategy has once again returned to purchases, adding another 1,550 BTC to its balance.

Of course, it's premature to say that the market has turned and that a strong pump will now follow, but the first signs of a complete end to the bearish cycle are emerging.

Regarding short-term trading, the strategy and conditions are outlined below.

Bitcoin

Buying Scenario

Scenario #1: I plan to buy Bitcoin today upon reaching the entry point around $61,600, targeting a rise to the level of $62,600. At around $62,600, I will exit the buy positions and sell immediately on the pullback. Before buying on the breakout, ensure that the 50-day moving average is below the current price and that the Awesome indicator is above zero.

Scenario #2: Bitcoin can be bought from the lower boundary of $61,200 if there is no market reaction to its breakout back towards the levels of $61,600 and $62,600.

Selling Scenario

Scenario #1: I plan to sell Bitcoin today upon reaching the entry point around $61,200, targeting a decline to the level of $60,400. At around $60,400, I will exit the sell positions and buy immediately on the pullback. Before selling on the breakout, ensure that the 50-day moving average is above the current price and that the Awesome indicator is below zero.

Scenario #2: Bitcoin can be sold from the upper boundary of $61,600 if there is no market reaction to its breakout back towards the levels of $61,100 and $60,400.

Ethereum

Buying Scenario

Scenario #1: I plan to buy Ethereum today upon reaching the entry point around $1,636, targeting a rise to the level of $1,668. At around $1,668, I will exit the buy positions and sell immediately on the pullback. Before buying on the breakout, ensure that the 50-day moving average is below the current price and that the Awesome indicator is above zero.

Scenario #2: Ethereum can be bought from the lower boundary of $1,618 if there is no market reaction to its breakout back towards the levels of $1,636 and $1,668.

Selling Scenario

Scenario #1: I plan to sell Ethereum today upon reaching the entry point around $1,618, targeting a decline to the level of $1,582. At around $1,582, I will exit the sell positions and buy immediately on the pullback. Before selling on the breakout, ensure that the 50-day moving average is above the current price and that the Awesome indicator is below zero.

Scenario #2: Ethereum can be sold from the upper boundary of $1,636 if there is no market reaction to its breakout back towards the levels of $1,618 and $1,582.

Meanwhile, Strategy, the company once led by Michael Saylor, whose name is associated with the company's strategy for accumulating bitcoins, has acquired a new batch of coins. This time, the purchase amounted to 1,550 BTC and occurred a week after selling 32 BTC, marking the first instance in history in which Strategy sold rather than bought. As we can see, Strategy's new purchases do not prevent Bitcoin from falling, as institutional investors have been more inclined to sell than buy in recent months. The company now holds over 800,000 coins, prompting a reasonable question: What does the company plan to do with them in the future? Strategy does not wish to sell bitcoins; will it continue to buy indefinitely?

However, we are more interested in the dynamics of Bitcoin itself than in Strategy's long-term plans. Due to the worsening geopolitical situation in the Middle East, demand for risk assets continues to decline. Yields on U.S. Treasuries are rising, and the Federal Reserve may raise the key rate this year, despite Kevin Warsh's arrival. As we have mentioned, we do not consider these factors to be the cause of Bitcoin's decline in recent weeks. However, it is undeniable that they do not encourage investors to buy. Saylor himself believes that the AI boom is to blame for Bitcoin's decline. The only remaining question is, how long will it last? There is an opinion that the AI sector is awaiting a financial crash, as huge investments have been poured into it, but whether they will pay off is a big question. The U.S. stock market is extremely overheated, and many experts predict a significant decline in the very near future. Thus, we currently see no grounds for a new "bullish" trend for Bitcoin.

Trading Recommendations for BTC/USD:

Bitcoin continues to form a full downward trend and a correction against it. We continue to expect a decline toward $57,500 (the 61.8% Fibonacci level of the three-year upward trend), and there are still no signs of an upward trend beginning. A new "bearish" FVG pattern formed in the $68,000 - $70,700 range, so this area serves as a POI (Point of Interest) for traders in the coming weeks. On the 4-hour timeframe, patterns may also be forming, but the movement is currently so strong that we would recommend trading on higher timeframes, such as the daily.

Trading Recommendations for ETH/USD:

The daily timeframe continues to show a downward trend that began last August. The key pattern for selling has been and remains the "bearish" order block on the weekly timeframe. As we warned, the movement provoked by this signal may be strong and prolonged. We do not consider it complete, as there are no signs of a conclusion of the downward trend in either Bitcoin or Ethereum. In the near future, Ethereum may resume its decline, targeting $1,391 and $788. An upward correction can be anticipated when at least some bullish pattern or other sign of an upward price reversal forms, at least on the 4-hour timeframe. Among the new POI for short positions, we highlight the FVG in the area of $1,624 - $1,720.

Explanations for Illustrations:

CHOCH – change of the trend structure.

Liquidity – Stop Loss, pending orders that market makers use to accumulate their positions.

FVG – area of price inefficiency. Price moves through such areas very quickly, indicating a complete absence of one side in the market. Subsequently, the price tends to return and react to these areas in continuation of the main trend.

IFVG – inverted area of price inefficiency. After returning to such an area, the price does not react to it; instead, it breaks through it impulsively and then tests it from the other side.

OB – order block. The candle on which the market maker opened a position to collect liquidity for forming their position in the opposite direction.

There are very few macroeconomic reports scheduled for Wednesday, but the sole event of the day could trigger significant market volatility. Recall that inflation in the U.S. has accelerated in recent months to 3.8%, and it may rise to 4.2% by the end of May. Thus, high inflation and the recovery of the U.S. labor market in 2026 could trigger a tightening of the Federal Reserve's monetary policy. Moreover, this could happen not at the end of the year as many currently expect, but much earlier. The Fed meeting will take place next week, and we will see how the Fed, under Kevin Warsh, plans to respond to the rapidly rising inflation. In the UK, Germany, and the EU, today's event calendars are empty.

Analysis of Fundamental Events:

There is absolutely nothing significant among the fundamental events for Wednesday. The European Central Bank meeting will take place on Thursday, while the meetings of the Fed and the Bank of England are scheduled for next week. Therefore, representatives of the central banks cannot comment on monetary policy at this time. They are in a "quiet period." The ECB is highly likely to raise rates this week, but the European currency currently cannot extract any dividends from this.

The geopolitical backdrop continues to be unsatisfactory, as Iran and the U.S. have once again moved closer to resuming conflict and failing negotiations. Talks between Washington and Tehran are ongoing, and according to the U.S. president, they are "very successful." However, there have been no confirmations from Iran regarding the success of diplomacy. Quite the opposite. The parties regularly violate ceasefire conditions, and Iran consistently refutes Trump's peacemaking rhetoric. The new week has begun with new mutual shelling in the Middle East and the downing of an American helicopter over the Strait of Hormuz. Judge for yourself how close Tehran and Washington are to a peace agreement...

General Conclusions:

During the third trading day of the week, both currency pairs may trade relatively actively, as important geopolitical news may emerge today, and the U.S. inflation report will be published. The euro can be traded today from the area of 1.1527-1.1531, while the British pound can be traded from the area of 1.3380-1.3386. Geopolitics remains a key influencing factor in the currency market.

Basic Rules of the Trading System:

1. The strength of a signal is evaluated based on the time it takes to form (bounce or breakout). The less time required, the stronger the signal.
2. If two or more trades were opened at a particular level based on false signals, all subsequent signals from that level should be ignored.
3. In a flat market, any pair may generate many false signals or none at all. Technical levels may be overlooked.
4. On the hourly timeframe, trading signals from the MACD indicator should be executed only when volatility is good, and a trend is confirmed by a trend line or channel.
5. If two levels are too close together (5 to 20 pips), they should be considered a support or resistance area.
6. After moving 15 pips in the correct direction, a Stop Loss should be set at breakeven.

What's on the Charts:

Price levels (areas) of support and resistance are targets when opening long or short positions or sources of signals.

Red lines indicate channels or trend lines that display the current trend and indicate the preferred direction for trading.

The MACD indicator (14,22,3) – histogram and signal line – is a supplementary indicator that can also be used as a source of signals.

Important speeches and reports (contained in the news calendar) can significantly impact the movement of the currency pair. Therefore, during their release, trading should be conducted with maximum caution, or one should exit the market to avoid sharp reversals against preceding movements.

Beginners trading in the forex market should remember that not every trade can be profitable. Developing a clear strategy and practicing money management are keys to success in trading over the long term.

1H Chart of the GBP/USD Pair

The GBP/USD pair also traded in different directions on Tuesday, as during the day the market first reacted to Trump's promises of a swift end to the war with Iran and the opening of the Strait of Hormuz, and then to the Iranian downing of an American helicopter and Trump's threats to carry out an act of retaliation. Only God knows at what stage the negotiations with Tehran are, but we tend to believe that they are far from completion and that the parties are far from mutual understanding. Let's recall that Tehran regularly denies Trump's claims about the closeness of a deal. Yesterday, the U.S. president stated that Iran is ready to abandon nuclear weapons, which Tehran has also repeatedly denied in the past. Essentially, on Tuesday, Iranian officials didn't even need to make official denial statements; they simply shot down an American helicopter. There's no point in trying to determine who is right or wrong in this situation, as no one will tell the truth. The British pound remains within the 1.3331-1.3476 range, and the market remains in a state of complete uncertainty.

5M Chart of the GBP/USD Pair

On the 5-minute timeframe on Tuesday, several interesting trading signals were formed. During the Asian trading session, the price bounced well from the 1.3319-1.3331 area, but not all novice traders were able to take advantage of this signal. The pair then broke the 1.3380-1.3386 area; however, the upward momentum essentially ended there. Two sell signals in the second half of the day suggest the possibility of the pair declining toward the 1.3319-1.3331 area today.

How to Trade on Wednesday:

On the hourly timeframe, the GBP/USD pair continues to form a downward trend as the geopolitical situation remains consistently poor, and the ascending trend line has been breached. However, without a full resumption of the war in the Middle East, the dollar cannot expect the growth it saw in February-March. Individual events may still prompt further strengthening (as happened on Friday), but we do not believe the market will trigger a new wave of risk aversion towards the dollar. The dollar under Trump is itself a risk asset.

On Wednesday, novice traders may open short positions targeting 1.3319-1.3331 if the price bounces from the 1.3380-1.3386 area. A price consolidation above the 1.3380-1.3386 area will allow for long positions with a target of 1.3456.

On the 5-minute timeframe, current levels to trade are 1.3175-1.3180, 1.3259-1.3267, 1.3319-1.3331, 1.3380-1.3386, 1.3456-1.3476, 1.3587-1.3598, 1.3631-1.3641, 1.3695, and 1.3741-1.3751. On Tuesday, no important events or reports are scheduled in the UK, but in the U.S., an important inflation report will be released. Additionally, America may strike Iran as a retaliation for the downed helicopter.

Basic Rules of the Trading System:

1. The strength of a signal is determined by the time required to form it (a bounce or a breakout). The less time taken, the stronger the signal.
2. If two or more trades were opened at a particular level based on false signals, subsequent signals from that level should be ignored.
3. In a flat market, any pair may form many false signals or none at all. Technical levels may be disregarded.
4. On the hourly timeframe, trading signals from the MACD indicator should be executed only when volatility is good, and a trend is confirmed by a trend line or channel.
5. If two levels are too close together (5 to 20 pips), they should be considered a support or resistance area.
6. After moving 15 pips in the correct direction, a Stop Loss should be set at breakeven.

What's on the Charts:

Price levels (areas) of support and resistance are targets when opening long or short positions or sources of signals.

Red lines indicate channels or trend lines that display the current trend and indicate the preferred direction for trading.

The MACD indicator (14,22,3) – histogram and signal line – is a supplementary indicator that can also be used as a source of signals.

Important speeches and reports (contained in the news calendar) can significantly impact the movement of the currency pair. Therefore, during their release, trading should be conducted with maximum caution, or one should exit the market to avoid sharp reversals against preceding movements.

Beginners trading in the forex market should remember that not every trade can be profitable. Developing a clear strategy and practicing money management are keys to success in trading over the long term.

1H Chart of the EUR/USD Pair

The EUR/USD currency pair had an interesting and, most importantly, entertaining trading session on Tuesday. It was not just the movements of the euro or the dollar that were entertaining; the geopolitical backdrop was also quite lively. As we have pointed out many times, the geopolitical situation can change about five times a day. The market sometimes ignores certain news, but in other cases, traders cannot control their emotions, leading to market "swings." On Tuesday morning, Donald Trump once again stated that a deal with Iran is close to being signed, and by the evening, it became known that Iran had shot down an American helicopter patrolling the Strait of Hormuz. Shortly after, Trump stated that this act of aggression would not go unanswered. Essentially, this sums up what we need to know about Trump's deal, which has been "on the verge of being signed" for the past two months. It is not surprising that the dollar fell in the first half of the day and rose in the second. The downward trend persists, as there is no sign of a peace deal between Iran and the U.S. The market continues to ignore most fundamental and macroeconomic events.

5M Chart of the EUR/USD Pair

On the 5-minute timeframe on Tuesday, two buy trading signals were formed. During the Asian trading session, the pair bounced off the 1.1527-1.1531 area and rose toward 1.1584-1.1594. It fell just a few pips short of hitting that target. During the American session, the pair returned to the 1.1527-1.1531 area and bounced again.

How to Trade on Wednesday:

On the hourly timeframe, the range has ended, and the downward trend has resumed after three weeks of stagnation, but further growth of the American currency will depend entirely on developments in geopolitical events. Trump continues to promise that a deal with Iran will be finalized soon. If this happens, the dollar will start losing positions.

On Wednesday, novice traders may open short positions targeting 1.1455-1.1474 if the price breaks below the 1.1527-1.1531 area. Long positions can be considered on a bounce from the 1.1527-1.1531 area, with targets of 1.1584-1.1594.

On the 5-minute timeframe, levels to consider are 1.1354-1.1363, 1.1413, 1.1455-1.1474, 1.1527-1.1531, 1.1584-1.1594, 1.1655-1.1666, 1.1745-1.1754, 1.1830-1.1837, 1.1899-1.1908. On Wednesday, we can expect the U.S. May inflation report, but the fate of the EUR/USD pair will again be determined by geopolitics. For instance, the U.S. may deliver a "retaliation strike" for the downed helicopter today, which would signify another violation of the ceasefire and a potential collapse of negotiations.

Basic Rules of the Trading System:

1. The strength of a signal is determined by the time it takes to form (a bounce or a breakout). The less time it took, the stronger the signal.
2. If two or more trades were opened at a particular level on false signals, all subsequent signals from that level should be ignored.
3. In a flat, any pair can form many false signals or none at all. Technical levels may be ignored.
4. On the hourly timeframe, trading signals from the MACD indicator should be executed only when volatility is good, and a trend is confirmed by a trend line or channel.
5. If two levels are too close together (5 to 20 pips), they should be considered a support or resistance area.
6. After moving 15 pips in the correct direction, a Stop Loss should be placed at breakeven.

What's on the Charts:

Price levels (areas) of support and resistance are targets when opening long or short positions or sources of signals.

Red lines indicate channels or trend lines that display the current trend and indicate the preferred direction for trading.

The MACD indicator (14,22,3) – histogram and signal line – is a supplementary indicator that can also be used as a source of signals.

Important speeches and reports (contained in the news calendar) can significantly impact the movement of the currency pair. Therefore, during their release, trading should be conducted with maximum caution, or one should exit the market to avoid sharp reversals against preceding movements.

Beginners trading in the forex market should remember that not every trade can be profitable. Developing a clear strategy and practicing money management are keys to success in trading over the long term.