Key Resistance Level Could Set the Stage for a Pullback

Central Bank

Economic

Summary:

The failure to print a higher high suggests that the pair may be poised for a deeper retracement, especially given the overextended rally that has brought it to its highest levels since 2022.

SELL EURUSD

Close Time

CLOSED

1.12909

Entry Price

1.09370

1.15800

1.16626 +0.00200 +0.17%

44.1

Pips

Profit

1.09370

1.12468

Exit Price

1.12909

Entry Price

1.15800

The Federal Reserve’s meeting minutes released Wednesday revealed ongoing internal deliberations over the potential economic impact of the Trump administration’s still-evolving trade policies. While the most aggressive tariffs remain suspended for now, they have not been fully withdrawn, maintaining a layer of uncertainty. Policymakers and Fed staff noted that recent bond market volatility warranted close attention, highlighting it as a possible threat to financial stability. Moreover, they pointed out that a shift in the U.S. dollar’s traditional safe-haven role, coupled with rising Treasury yields, could have far-reaching consequences for the broader economy.

Fed officials also raised concerns about a scenario in which inflation and unemployment might rise simultaneously—a combination that could force the central bank into a difficult position: whether to tighten monetary policy to rein in inflation or ease rates to support growth and employment.

Amid this backdrop, U.S. consumer confidence posted a remarkable rebound in May, recovering from near five-year lows. The Conference Board’s confidence index surged by 12.3 points to 98.0, marking the strongest monthly increase in four years and surpassing the consensus forecast of 87.1 from a Bloomberg survey of economists. The data reflected improving sentiment toward both the economy and the labor market as trade tensions appeared to subside, at least temporarily.

Expectations for the next six months saw their most significant monthly rise since 2011, while the assessment of current conditions also improved. The recovery in confidence was broad-based across age groups, income levels, and political affiliations, though the sharpest increase was seen among Republican respondents.

However, not all economic data was upbeat. New orders for U.S. durable goods fell sharply in April, dropping 6.3%, or $19.9 billion, to $296.3 billion, following a downwardly revised gain of 7.6% in March. The latest decline, though significant, was slightly less severe than the expected 7.9% fall. According to the U.S. Census Bureau, excluding transportation, new orders rose by a modest 0.2%. But when defense-related orders were removed, the data showed a deeper 7.5% decline.

The transportation equipment category, which had posted four consecutive months of gains, led the April drop with a decline of $20.3 billion, or 17.1%, bringing the total to $98.8 billion. This reversal highlights the fragility of recent gains and reinforces the mixed nature of current economic momentum.

In Europe, early estimates of France’s Consumer Price Index (Harmonized with EU standards) for May pointed to a noticeable cooling in inflation. The annualized CPI rose at a slower pace of just 0.6%, down from April’s 0.9% increase. This weaker inflation print has prompted renewed support within the European Central Bank (ECB) for a rate cut at the upcoming June policy meeting.

ECB policymaker and French central bank governor François Villeroy de Galhau called the 0.6% inflation rate a “very encouraging sign of disinflation at work” during remarks on Tuesday. Villeroy struck a dovish tone on the path of monetary policy, suggesting that policy normalization in the eurozone may still have some way to go. Key Resistance Level Could Set the Stage for a Pullback_1

Key Resistance Level Could Set the Stage for a Pullback_1

Technical Analysis

The EUR/USD pair is currently facing a strong resistance level near 1.1426—a price zone that has triggered downward pressure on three separate occasions. Each time the pair approached this level, it was met with selling interest, reinforcing the significance of this area. Notably, the local high at 1.1575, set on April 21, remains untouched. The failure to print a higher high suggests that the pair may be poised for a deeper retracement, especially given the overextended rally that has brought it to its highest levels since 2022.

The Relative Strength Index (RSI) has reached 60, still below the overbought threshold. However, the recent rejection from resistance, combined with the lack of fresh highs, could intensify downside pressure in the short term. If the pair continues to struggle near current levels, a correction could unfold, targeting the next significant support around 1.0937. This area, which previously acted as a major resistance, may now serve as a potential demand zone—making it a crucial level for traders looking to position for the next major move.

Trading Recommendations

Trading direction: Sell

Entry price: 1.1291

Target price: 1.0937

Stop loss: 1.1580

Validity: Jun 06, 2025 15:00:00

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Warren Takunda

Economic

Summary:

GBP/JPY retreats slightly to 194.50 after hitting near two-week highs, as the Pound loses some momentum.

BUY GBPJPY

Close Time

CLOSED

194.997

Entry Price

199.000

192.500

206.925 -0.175 -0.08%

59.1

Pips

Profit

192.500

195.588

Exit Price

194.997

Entry Price

199.000

The British Pound has come under modest pressure on Wednesday, pulling back from its recent gains as the GBP/JPY currency pair retraced to around 194.50 during the European trading session. This dip follows a test of the 195.60 level — a near two-week high — reached in the prior session, as traders began taking profit and reassessing the path of UK interest rates after a flurry of strong domestic economic data.

Despite the pullback, the broader outlook for Sterling remains constructive. The retreat in GBP/JPY appears to be more of a corrective move rather than a full reversal, with technical and macroeconomic underpinnings still favoring the bulls. The Pound's underlying strength has been bolstered by recent upside surprises in UK inflation and retail figures, both of which are challenging the market’s prior assumptions that the Bank of England (BoE) would pursue a rate cut as soon as June.

Data released last week showed headline Consumer Price Index (CPI) inflation in the UK rose to 3.5% year-on-year in April, exceeding expectations. This was compounded by a surprisingly strong 1.2% month-over-month jump in retail sales, signaling resilient consumer demand even in a high-rate environment. These figures have complicated the narrative for doves at the BoE, who had been leaning toward policy easing amid sluggish growth concerns.

In response, traders have dialed back their rate cut bets, lifting UK yields and providing Sterling with some fundamental support — though not enough to prevent Wednesday's intraday dip in GBP/JPY.

Meanwhile, on the other side of the currency pair, the Japanese Yen has been exhibiting renewed vigor. The boost comes amid a sharp climb in domestic bond yields, following reports that Japan's Ministry of Finance is considering a reshuffling of its bond issuance strategy. According to Reuters, Tokyo may opt to reduce the supply of super-long-dated bonds as part of its annual fiscal framework revisions. Such a move would tighten long-end bond supply, pushing up yields and enhancing the Yen’s appeal as carry trade dynamics temporarily reverse.

The rise in Japanese bond yields — traditionally among the world’s lowest — has made the Yen more attractive relative to high-yielding peers, including the Pound. This shift, although perhaps transitory, has been enough to prompt some unwinding of long GBP/JPY positions this week.

Technical Analysis

From a technical perspective, GBP/JPY remains firmly in a bullish trajectory despite Wednesday’s dip. The pair had recently broken above the horizontal resistance at 194.00, marking a significant breakout on the hourly chart. Price action continues to print higher highs and higher lows, suggesting that the bulls are still in control.

A key support zone lies near the 50-hour Exponential Moving Average (EMA), currently situated around 194.35. This level is being closely watched by intraday traders, with a successful hold expected to invite fresh buying interest.

The near-term target remains at 195.65 — a level that has recently acted as a cap. A clean breach above this resistance could open the door for a run toward 196.45, and potentially the psychologically significant 199.00 level, aligning with the upper bounds of the recent bullish channel.

Indicators such as the Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) continue to show positive momentum. Furthermore, price action is finding consistent support at the 194.00 mark, a zone that could serve as a launching pad for renewed bullish advances.

TRADE RECOMMENDATION

BUY GBPJPY

ENTRY PRICE: 195.00

STOP LOSS: 192.50

TAKE PROFIT: 199.00

Risk Warnings and Disclaimers

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Warren Takunda

Traders' Opinions

Summary:

The euro regained footing against the U.S. dollar during Wednesday’s European session, buoyed by technical support near 1.1300.

BUY EURUSD

Close Time

CLOSED

1.12998

Entry Price

1.17000

1.11000

1.16626 +0.00200 +0.17%

54.6

Pips

Profit

1.11000

1.13544

Exit Price

1.12998

Entry Price

1.17000

The euro managed to recover some ground against the dollar on Wednesday, paring earlier losses in a session dominated by investor caution and the looming release of the Federal Reserve’s May policy meeting minutes. The EUR/USD currency pair found meaningful support around the 1.1300 handle, but upside momentum remains capped near the 1.1340 level, reflecting broader market hesitation amid mixed macroeconomic signals.

The U.S. dollar’s strength in recent sessions has been largely underpinned by a resurgence in consumer confidence. The Conference Board’s Consumer Confidence Index surged to 98.0 in May from a prior reading of 85.7 in April, reversing six months of deterioration and offering a much-needed boost to sentiment in the world’s largest economy. Notably, the survey indicated a declining percentage of Americans expecting a recession within the next year—a key psychological shift that bolstered demand for the greenback.

Despite a headline drop of 6.3% in April’s Durable Goods Orders—a figure reflecting waning demand in the manufacturing sector and particularly in aircraft orders—the decline was less severe than the anticipated 7.9% contraction. This modest positive surprise mitigated concerns that U.S. President Donald Trump’s erratic tariff strategy is doing deeper damage to industrial output, even as lingering trade policy uncertainty continues to complicate the broader economic narrative.

Adding to the dollar’s tailwinds was the White House’s decision to delay the imposition of new tariffs on Eurozone goods, a move that momentarily soothed fears of a fresh trade conflict between Washington and Brussels. The U.S. Dollar Index (DXY), which had recently touched one-month lows, rebounded nearly 1% on the news, reflecting a broader repricing of geopolitical risk.

Across the Atlantic, the euro remained under pressure due to lackluster economic data from key member states. In France, consumer confidence for April posted a sluggish recovery, rising only 0.3% month-over-month following a 1.1% drop in March. The reading came in well below market expectations of 0.8%, underscoring persistent household unease in the Eurozone’s second-largest economy.

Moreover, France’s Q1 GDP growth was confirmed at a paltry 0.1%, matching the preliminary estimate but doing little to inspire optimism. Employment data offered no respite, with nonfarm payrolls unexpectedly declining 0.1%, defying forecasts of a flat reading.

Meanwhile, German labor market figures painted a similarly uninspiring picture. The unemployment rate held steady at 6.3%, but the net change in employment showed a worrying 34,000 drop—more than triple the 11,000 decline economists had expected. Taken together, the data validates the recent cautious rhetoric from ECB policymakers.

All eyes are now on the minutes from the Federal Reserve’s most recent policy meeting, due later today. Market participants are eager for insight into the Fed’s internal deliberations, especially given the growing divergence in policy outlooks between the Federal Reserve and the European Central Bank.

The central bank’s tone on inflation, growth risks, and future rate path will likely be pivotal in setting short-term direction for the dollar. A hawkish tilt in the minutes could extend the dollar’s rally, while any hint of dovishness may open the door for renewed euro strength—particularly if the EUR/USD pair holds above key technical levels.

Technical Analysis

From a technical perspective, EUR/USD continues to trade within a well-defined ascending channel. Price action has remained firmly bullish since rebounding from key support at 1.1260, with a series of higher highs and higher lows confirming ongoing buyer control.

The pair is inching closer to the psychologically significant 1.1400 level, a critical supply zone that previously triggered substantial selling pressure. A decisive break above this region could pave the way for a more extended rally, particularly if the upcoming Fed minutes disappoint dollar bulls.

Until then, traders will be closely monitoring whether the pair can sustain price action above the channel’s midline and maintain support at 1.1260. Should those levels hold, the bullish bias remains intact, though consolidation near the 1.1400 barrier may precede any decisive breakout.

TRADE RECOMMENDATION

BUY EURUSD

ENTRY PRICE: 1.1300

STOP LOSS: 1.1100

TAKE PROFIT: 1.1700

Risk Warnings and Disclaimers

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Eva Chen

Economic

Forex

Summary:

The dollar's upside potential may be capped by persistent market concerns regarding slowing U.S. economic growth and the fiscal deficit. Risk reversals continue to reflect a strong bias for dollar puts.

BUY USDX

Close Time

CLOSED

99.810

Entry Price

102.810

97.400

98.800 -0.150 -0.15%

189.0

Pips

Loss

97.400

97.920

Exit Price

99.810

Entry Price

102.810

Fundamentals

The U.S. Dollar Index (USDX) is currently consolidating after a rise of over 0.50% in the previous session. During Wednesday's European trading hours, the USDX traded around 99.80. The asset is being supported by strengthening consumer confidence data.

Data released on Tuesday revealed that the U.S. Conference Board's Consumer Confidence Index for May surged to 98.0, up from 85.7, significantly exceeding the anticipated 87.1 and marking the first increase in six months. The Present Situation Index rose by 1.8 points to 135.9. The Expectations Index increased by 17.4 points to 72.8.

Despite the rebound, the Expectations component remains below the critical threshold of 80, which historically signals an elevated risk of recession in the coming months.

Following the partial suspension of tariffs between the U.S. and China on May 12, economic conditions improved, although the Conference Board noted that the rebound had commenced earlier.

This increase was "largely driven by consumer expectations," as reflected in the three components of the expectations index: business conditions, employment prospects, and future income.

The Conference Board's Consumer Confidence Survey typically garners less attention. However, on the one hand, the current environment is anything but typical. On the other hand, the survey results significantly exceeded expectations.

The May rebound in the Conference Board's U.S. Consumer Confidence data bolstered the dollar. Further positive data is needed to restore market confidence in US economic growth, while deficit concerns are unlikely to dissipate in the short term.

Technical Analysis

The dollar faces continued downside risk in the short term, mitigated by a positive surprise in consumer confidence data. However, we remain cautious about chasing a rebound in the USDX back to the 103.86 pivot point, a key level for bullish sentiment.

However, short-term risk reversals indicate a moderation in the bearish dollar sentiment observed earlier this month. Technical signals support some near-term stabilization for the dollar. Nevertheless, the overall bearish trend in the dollar remains entrenched across short, medium, and long-term analyses, suggesting limited upside potential overall.

Trading Recommendations

Trading Direction: Buy

Entry Price: 99.65

Target Price: 102.81

Stop Loss: 97.40

Valid Until: June 12, 2025 23:55:00

Support: 98.72, 97.92, 97.70

Resistance: 100.40, 101.99, 102.68

Risk Warnings and Disclaimers

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Eva Chen

Cryptocurrency

Summary:

Risk-on sentiment continues to fuel positive signals in the crypto market. Bitcoin has initiated a significant rally, breaching prior resistance levels and establishing new all-time highs. Current market consolidation could lead to a price retracement.

SELL BTC-USDT

Close Time

CLOSED

108858.7

Entry Price

95209.0

113650.0

91574.9 +2020.1 +2.26%

3397.7

Pips

Profit

95209.0

105461.0

Exit Price

108858.7

Entry Price

113650.0

Fundamentals

Over the past 24 hours, the market capitalization increased by 0.5%, reaching US$3.45 trillion, yet remains below Tuesday's intraday peak of US$3.48 trillion and Friday's high of US$3.55 trillion. This suggests sustained risk-on sentiment, given recent market dynamics.

Bitcoin miners are actively supporting further price appreciation as Bitcoin approaches new all-time highs. According to Axel Adler Jr., miners have intensified their activities, leading to increased exchange inflows, thereby accelerating price gains.

Bitcoin miners are currently selling nearly 50 BTC daily. This represents a significant increase from the previous level of 25 BTC per day. However, miner inflows have previously reached 100 BTC per day, aligning with historical peaks. This indicates that, despite the substantial rise in miner selling, it has not yet reached concerning levels.

Market statistics indicate that current inflows align with broader bullish sentiment, as Bitcoin steadily approaches the US$110,000 threshold. Bitcoin is currently trading around US$108,935, with a 16.60% increase in the last 24 hours. Furthermore, Bitcoin has risen 4.25% on a weekly basis. Over the past 30 days, Bitcoin has surged by an impressive 16.65%.

Momentum Indicators Are Beginning to Show Signs of Divergence, Suggesting a Potential Correction_1

Technical Analysis

Following a new all-time high last Thursday, Bitcoin's price initiated a fresh rally, which now shows signs of a pause.

In the 4H timeframe, it indicates price consolidation around the US$108,800 level, trading above both the 100 SMA and 200 SMA, suggesting continued bullish dominance. However, momentum indicators are showing potential bearish divergence, implying a possible market correction.

Immediate support is near US$108,000. The subsequent key support levels are at US$107,645, or the 50% Fibonacci retracement of the upward move from the US$102,137 low to the US$111,939 high.

A break below US$107,000 could initiate a Bitcoin decline toward the US$105,000 support level. Further downside could see prices testing the US$103,500 support.

On the upside, the price faces resistance near US$110,000. The next key resistance is at US$111,800. Major resistance could be found at US$112,500. A successful close above US$112,500 might trigger a sustained rally.

Trading Recommendations

Trading Direction: Sell

Entry Price: 109192

Target Price: 95209

Stop Loss: 113650

Valid Until: June 12, 2025 23:55:00

Support: 108000, 107645, 106692

Resistance: 110858, 112048, 113297

Risk Warnings and Disclaimers

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Alan

Forex

Summary:

Recently, the pound has been on a steady upward trajectory, primarily due to the US dollar's weakness and the resilience of the UK economy. Technically, GBPUSD has broken through key resistance levels, further opening up the upside potential.

BUY GBPUSD

Close Time

CLOSED

1.35088

Entry Price

1.41900

1.33200

1.33327 +0.00015 +0.01%

2.4

Pips

Profit

1.33200

1.35112

Exit Price

1.35088

Entry Price

1.41900

Fundamentals

The recent strength of GBPUSD is mainly attributed to the US dollar being under pressure and the resilience of the UK economy. The protracted US debt ceiling negotiations and the intensifying divisions within Congress have significantly increased market uncertainty regarding the dollar's outlook, thereby exerting a noticeable drag on the US currency.

In contrast, data released in the UK shows that the country's GDP grew by 0.7% QoQ in 2025 Q1, not only exceeding the market's general expectation of 0.6% but also outperforming other G7 economies, highlighting the UK economy's inherent growth momentum. On the other hand, the US economy contracted by -0.3% on an annualized QoQ basis in 2025 Q1, marking the first decline since 2022 and the worst performance since 2022 Q2.

Moreover, the UK's substantial progress in free trade agreement negotiations with India has provided medium to long-term support for the pound. As the Sino-US tariff war eases, global risk appetite is also showing an upward trend, with the stock market stabilizing as a whole and safe-haven demand declining. As a result, funds are flowing into high-yielding currencies like the pound.

Technical Analysis

Bullish Breakthrough Confirmed, Short-Term Uptrend Likely to Persist_1

From the weekly chart perspective, GBPUSD has broken through the high of 1.3433 in September 2024, further opening up the upside potential. The first upside target is likely to reach the upper resistance level of 1.4240.

Bullish Breakthrough Confirmed, Short-Term Uptrend Likely to Persist_2

From the daily chart perspective, after breaking through 1.3433, the pressure has turned into support. The fact that the pair retested this level today without breaking down further has increased the likelihood of continued upside momentum in the future.

Therefore, traders are recommended to focus on going long on dips.

Trading Recommendations

Trading Direction: Long

Entry Price: 1.3500

Target Price: 1.4190

Stop Loss: 1.3320

Valid Until: June 11, 2025, 23:00:00

Support: 1.3433/1.3139

Resistance: 1.3592/1.4240

Risk Warnings and Disclaimers

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Manuel

Forex

Economic

Summary:

A sustained hold above this moving average could accelerate bullish momentum, potentially driving the pair toward the upper edge of the channel.

BUY AUDUSD

Close Time

CLOSED

0.64471

Entry Price

0.65310

0.64000

0.66450 +0.00067 +0.10%

8.7

Pips

Profit

0.64000

0.64558

Exit Price

0.64471

Entry Price

0.65310

Tensions between the United States and the European Union resurfaced this week as U.S. President Donald Trump took to social media to float the idea of imposing an additional 50% tariff on all EU imports, effective June 1. However, in a now-familiar pattern for markets, the president quickly walked back the threat, postponing the proposed tariff deadline to July 9. This delay has temporarily eased investor concerns and added to the sense of unpredictability surrounding U.S. trade policy.

Meanwhile, Minneapolis Federal Reserve President Neel Kashkari emphasized on Tuesday that policymakers should hold interest rates steady until there is greater clarity on how elevated tariffs are affecting inflation. He warned against overlooking the inflationary effects of supply-side shocks, signaling a cautious approach from the Fed in the face of ongoing trade uncertainties.

In more encouraging news, U.S. consumer confidence surged in May, rebounding sharply from near five-year lows. The Conference Board's index jumped by 12.3 points to 98.0—the biggest monthly increase in four years. This print came in well above the Bloomberg survey consensus of 87.1, reflecting renewed optimism about the economic outlook and job market amid a temporary cooling of trade tensions.

Consumer expectations for the next six months posted their strongest rise since 2011, while the current conditions index also improved. The confidence boost was widespread across age groups, income levels, and political affiliations, though Republican respondents showed the most significant jump in sentiment.

In contrast, April's U.S. durable goods orders painted a less rosy picture, falling 6.3%, or $19.9 billion, to $296.3 billion, according to Census Bureau data. This followed a downwardly revised 7.6% gain in March. Nevertheless, the latest decline was not as severe as the market’s projected 7.9% drop.

The release noted that excluding transportation, new orders edged up by 0.2%. However, excluding defense, they fell by 7.5%. Transportation equipment, which had notched gains for four straight months, led the downturn—plunging $20.3 billion, or 17.1%, to $98.8 billion.

On the other side of the globe, the Reserve Bank of Australia (RBA) remains firmly dovish, continuing to prioritize domestic growth in the face of heightened global uncertainty. Investors are now shifting their focus to Australia’s upcoming inflation data. The monthly Consumer Price Index (CPI) for April is scheduled for release on Wednesday, with consensus expecting a slight drop in the annual inflation rate—from 2.4% to 2.3%.

A softer-than-expected CPI reading could reinforce market expectations for further RBA rate cuts in the months ahead, especially if external pressures continue to weigh on economic momentum. Bullish Momentum May Build If Key Support Holds_1

Bullish Momentum May Build If Key Support Holds_1

Technical Analysis

The AUD/USD pair is currently trading within an ascending channel on the one-hour chart. After a recent pullback toward the lower boundary of the channel—a zone that has previously acted as a springboard for bullish moves—price action is once again showing signs of stabilization. Notably, the pair is hovering just above the 100-period moving average, which may act as a dynamic support level. A sustained hold above this moving average could accelerate bullish momentum, potentially driving the pair toward the upper edge of the channel, with resistance around the 0.6531 level.

The Relative Strength Index (RSI) recently dipped to 28.29, slipping briefly below the oversold threshold. These levels often attract interest from buyers looking for favorable entry points. More importantly, a bullish divergence has emerged: while the price has printed a higher low, the RSI has dropped to a lower level compared to the previous dip at the same support zone. This suggests that downward momentum is weakening and that a corrective move to the upside could be forming.

Holding this key support area is critical for the bullish setup. Should the price break decisively below the ascending trendline, the pattern would be invalidated, opening the door to further downside risk.

Trading Recommendations

Trading direction: Buy

Entry price: 0.6446

Target price: 0.6531

Stop loss: 0.6400

Validity: Jun 06, 2025 15:00:00

Risk Warnings and Disclaimers

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