Technical Analyst, Saxo Bank
EURUSD seems stuck in a tighter and tighter range with key support at 1.0640. Break out should be imminent which is likely to be to the downside. EURUSD has been rejected at the short-term falling trendline, RSI is showing negative sentiment and 55 SMA, which seems to be a medium-term resistance, is declining. In fact, all Moving Averages are declining.
GBPUSD resistance at around 1.2655 seems to be too strong to penetrate. Despite divergence on RSI is still showing negative sentiment i.e. RSI inconclusive. GBPUSD needs to break its range bound behaviour i.e. either a break above 1.2655 or a below 1.2435
If break out occurs to the upside falling trend line will offer some resistance. A break of the trend line could lead to a move towards 1.30.
Below support at 1.2435 May lows around 1.2150 are likely to be tested
AUDUSD got rejected at key resistance level at around 0.7267 where a cluster of slightly declining Moving Averages are adds to the resistance.
If AUDUSD breaks below 0.7140 the steep rising trend line is broken and short-term corrective uptrend likely to be reversed. A swift move to support at around 0.7055 should be expected.
For AUDUSD to continue its uptrend a break above 0.7285 is needed.
NZDUSD rejected at key resistance at around 0.6570 and seems to have resumed down trend. RSI showing negative sentiment indicating May lows likely to be tested. Some support at 0.6354.
To reverse this bearish scenario at break above 0.6580 is needed.
2024: The wasted year
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.