Seize Every Pullback Opportunity: Bulls Set to Break Through Subprime Crisis Sell-Off Levels

Forex

Summary:

The GBPJPY fell from multi-year highs to around 210.30 after Japan's Finance Minister Satsuki Katayama made verbal intervention in the market.

BUY GBPJPY

EXP

PENDING

210.000

Entry Price

215.750

208.000

210.759 -0.593 -0.28%

Pips

PENDING

208.000

Exit Price

210.000

Entry Price

215.750

Fundamentals

On Tuesday, GBPJPY retreated from Monday's multi-year high of 211.60 to around 210.30. Japanese Finance Minister Satsuki Katayama stated on Monday that the government may intervene in the market to counter excessive one-sided volatility, providing temporary support for the yen and halting GBPJPY's upward momentum.

Japanese Finance Minister Satsuki Katayama stated in a media interview that if exchange rate movements significantly deviate from economic fundamentals, the Japanese government possesses the flexibility to take decisive foreign exchange intervention measures. This represents her strongest warning to market speculators to date following the yen's recent sustained weakening.

Satsuki Katayama pointed out that last Friday's sharp depreciation of the yen was clearly not driven by fundamentals but stemmed from speculative behavior. She emphasized: “We have made it clear that we will take decisive action against such movements, as stated in the joint statement by the Japanese and U.S. finance ministers.” Her remarks came as markets once again speculated that Japanese authorities might intervene in the foreign exchange market.

Notably, Satsuki Katayama specifically referenced the joint statement on exchange rates signed by the Japanese and U.S. finance ministers in September, implying that Japan has tacit U.S. approval for intervention without further consultation. The statement reaffirmed both sides' support for market-determined exchange rates while confirming that intervention remains a reasonable option under exceptional circumstances such as “excessive volatility.” Satsuki Katayama stated, “This means we have the freedom to act.” The USDJPY and GBPJPY exchange rates promptly declined.

However, as we mentioned yesterday, if Japanese authorities attempt to prop up the yen through foreign exchange intervention, such efforts are likely to prove ineffective unless the government simultaneously manages fiscal policy risks appropriately.

The Japanese government is expected to approve its fiscal 2026 budget this Friday, with investors concerned that the budget may include an unusually large scale of departmental spending. Should this prove true, it could trigger a decline in Japanese government bond prices and further intensify downward pressure on the yen.

Seize Every Pullback Opportunity: Bulls Set to Break Through Subprime Crisis Sell-Off Levels_1

Technical Analysis

GBPJPY faced pressure on Tuesday but remains biased upward, with the near-term target at 211.98—the 61.8% retracement level of the 199.04 to 205.30 range. A decisive break above this level would extend the current uptrend toward the next target at 215.75 (marking the starting point of the 2008 subprime crisis sell-off). On the downside, a break below the short-term support at 210.00 would shift the intraday outlook to neutral, potentially triggering a consolidation phase before a fresh upward move.

Trading Recommendations

Trading Direction: Buy

Entry Price: 210.00

Target Price: 215.75

Stop Loss: 208.00

Valid Until: January 9, 2026 23:55:00

Support: 209.81, 209.29, 208.21

Resistance: 211.98, 212.82, 215.10

Risk Warnings and Disclaimers

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Warren Takunda

Traders' Opinions

Summary:

EUR/JPY has pulled back from record highs as Japanese intervention warnings sparked Yen buying, but policy divergence between the ECB and BoJ suggests the move is corrective rather than trend-ending.

SELL EURJPY

EXP

TRADING

184.000

Entry Price

182.800

185.000

184.120 -0.575 -0.31%

0.0

Pips

Flat

182.800

Exit Price

184.000

Entry Price

185.000

The EUR/JPY cross has retreated from historic highs, snapping a multi-session rally as renewed verbal intervention from Japanese authorities triggered a rebound in the Yen and encouraged traders to lock in profits. At the time of writing on Tuesday, the pair was trading near 183.90, down roughly 0.30% on the day, after briefly touching an all-time peak close to 184.92 earlier in the week.

The pullback underscores the fragile balance driving the cross: a structurally weak Japanese Yen facing intermittent policy jawboning, set against a relatively stable Euro underpinned by the European Central Bank’s increasingly patient stance.

The Japanese Yen found modest support following comments from Japan’s Finance Minister Satsuki Katayama, who reiterated that authorities retain full flexibility to respond to “excessive” moves in the foreign exchange market. While no concrete action was announced, the reminder alone was sufficient to cool speculative enthusiasm and prompt a wave of short-covering in the Yen.

Historically, such rhetoric has often had only a fleeting impact unless backed by direct intervention or a material shift in monetary policy. Still, with EUR/JPY trading at record levels, the market appeared vulnerable to even mild policy pushback. The sharp ascent in recent sessions had left positioning stretched, making the pair susceptible to corrective moves on any hint of official discomfort.

That said, many investors remain skeptical about the durability of Yen strength without deeper structural support. Japan’s trade dynamics, yield differentials, and persistent capital outflows continue to weigh heavily on the currency, limiting the long-term effectiveness of verbal warnings alone.

At the heart of the Yen’s broader weakness lies the Bank of Japan’s cautious approach to policy normalization. Although the BoJ recently lifted its policy rate by 25 basis points to 0.75%, the central bank has been careful to avoid signaling a clear path toward further tightening.

Former BoJ board member Makoto Sakurai suggested that the next rate hike may not materialize until the middle of next year, while cautioning that subsequent increases could become increasingly difficult as economic momentum slows. This reinforces the perception that Japan’s policy normalization will remain gradual and limited, leaving the Yen exposed during periods of global risk stability and yield-seeking behavior.

As long as Japanese yields lag well behind those of Europe and the United States, rallies in the Yen are likely to remain corrective rather than trend-defining.

On the other side of the equation, the Euro continues to trade with relative stability. Investors are still assessing the European Central Bank’s policy trajectory into 2026, but recent communication has reduced uncertainty around near-term easing.

ECB officials have repeatedly emphasized that inflation is expected to remain close to the 2% target over the medium term, diminishing the urgency for additional rate cuts. At its latest meeting, the ECB left rates unchanged, with President Christine Lagarde stating that monetary policy is “in a good place” and that current settings may be maintained for an extended period.

Markets have increasingly interpreted this as a signal that the ECB’s rate-cut cycle is approaching its conclusion. If confirmed, this would provide a supportive backdrop for the Euro, particularly against low-yielding counterparts such as the Yen.

Incoming data from the Eurozone has done little to challenge this narrative. Germany’s Import Price Index rose 0.5% month-on-month in November, exceeding expectations and hinting at mild upstream price pressures. However, on an annual basis, import prices were still down 1.9%, reinforcing the view that inflation remains contained.

For policymakers, this combination of subdued inflation and improving stability supports a “wait-and-see” approach—one that contrasts sharply with the BoJ’s ongoing struggle to decisively exit ultra-loose policy.

Technical Analysis

From a technical perspective, EUR/JPY appears to be entering a corrective phase after failing to sustain momentum above the 184.90 resistance zone, which has now emerged as a formidable barrier. The rejection from record highs has pushed the pair back toward 183.75–183.90, signaling the early stages of a bearish corrective wave.

Momentum indicators are beginning to align with this view. The Stochastic oscillator is drifting toward the 20 level, increasing negative pressure and favoring further downside in the near term. A continuation of corrective trading could see the pair test 183.30, with a deeper move potentially exposing key support near 182.80.

TRADE RECOMMENDATION

SELL EURJPY

ENTRY PRICE: 184.00

STOP LOSS: 185.00

TAKE PROFIT: 182.80

Risk Warnings and Disclaimers

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Warren Takunda

Traders' Opinions

Summary:

Gold eases from record highs as the dollar rebounds modestly, but geopolitical risks, Fed rate-cut expectations, and strong technical structure continue to support a bullish outlook.

BUY XAUUSD

EXP

TRADING

4460.00

Entry Price

4530.00

4430.00

4490.11 +46.96 +1.06%

0.0

Pips

Flat

4430.00

Exit Price

4460.00

Entry Price

4530.00

Gold prices retreated modestly on Tuesday after briefly surging to yet another record high, as a mild rebound in the U.S. dollar encouraged short-term profit-taking across precious metals markets. Spot gold (XAU/USD) was last trading near $4,457, down from an intraday peak close to $4,497, marking the metal’s latest all-time high in an extraordinary rally that has reshaped the global commodities landscape.

The pullback followed a mixed set of U.S. economic releases, which offered little clarity on the near-term trajectory of the world’s largest economy but were sufficient to trigger a modest bounce in the greenback. The dollar’s recovery, while limited, was enough to cap gold’s upside in the short term, particularly as prices hovered near historically stretched levels.

Still, the broader picture suggests gold’s downside remains well contained. Heightened geopolitical tensions continue to underpin demand for traditional safe-haven assets, with investors showing little appetite to materially reduce exposure to bullion. Ongoing conflicts, fragile diplomatic relations, and persistent uncertainty around global trade and security have kept risk sentiment fragile, reinforcing gold’s role as a hedge against systemic instability.

At the same time, expectations that the Federal Reserve could continue easing monetary policy well into 2026 remain a powerful structural driver. While U.S. policymakers have avoided committing to an aggressive rate-cut path, recent data has reinforced the view that inflation is cooling gradually, allowing the Fed room to pivot toward a more accommodative stance over the medium term. Lower real yields have historically been supportive for non-yielding assets such as gold, and current market pricing reflects confidence that monetary conditions will remain favorable.

Another factor fueling the latest leg higher has been year-end portfolio repositioning. As markets head into a long holiday period, fund managers and institutional investors are adjusting allocations, locking in profits in some asset classes while increasing exposure to assets perceived as defensive or structurally strong. Gold has emerged as a clear beneficiary of this flow, especially after outperforming most major asset classes throughout the year.

Even with intermittent bouts of profit-taking, the scale of gold’s advance remains striking. The metal is up nearly 70% year to date, putting it on track for its strongest annual performance since 1979, a period similarly defined by inflation fears, geopolitical stress, and deep skepticism toward fiat currencies. From my perspective, this comparison is telling: today’s rally is not merely speculative but reflects deep-seated concerns about fiscal sustainability, global debt levels, and long-term currency debasement.

Technical Analysis

From a technical standpoint, the recent price action aligns with a corrective retracement rather than a trend reversal. Gold experienced a sharp bearish impulse that briefly broke market structure to the downside, sweeping liquidity beneath recent lows. However, this move ultimately tapped into a bullish order block formed following a previous break of structure (BOS), a zone that has now proven to be a key area of institutional demand.

Upon revisiting this order block, price printed a clear rejection candle, signaling strong buying pressure and suggesting that so-called “smart money” continues to defend the zone aggressively. Market structure analysis shows a prior Change of Character (CHoCH) followed by a BOS, reinforcing the idea that the latest decline represents a pullback within a higher-timeframe bullish trend rather than the start of a sustained downturn.

As long as price holds above this demand zone, the technical bias remains firmly constructive. A clean break and close below the order block would invalidate the setup and raise the risk of deeper consolidation. However, if support holds, gold is likely to resume its upward trajectory, initially targeting internal highs before extending toward external liquidity above the most recent weak high.

TRADE RECOMMENDATION

BUY GOLD

ENTRY PRICE: 4460

STOP LOSS: 4430

TAKE PROFIT: 4530

Risk Warnings and Disclaimers

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Eva Chen

Commodity

Summary:

Gold prices extended Monday's strong gains, testing and approaching the US$4,500 level. Escalating geopolitical tensions coupled with broad dollar weakness have jointly supported gold's upward momentum; however, the rally may pause as prices approach a potential reversal level.

SELL XAUUSD

EXP

TRADING

4486.16

Entry Price

4357.00

4532.00

4490.11 +46.96 +1.06%

0.0

Pips

Flat

4357.00

Exit Price

4486.16

Entry Price

4532.00

Fundamentals

During the Asian session on Tuesday, gold prices hit another record high, nearing US$4,500. Expectations of further interest rate cuts by the Federal Reserve and geopolitical concerns fueled safe-haven demand, boosting gold prices.

Additionally, the U.S. seizure of a Venezuelan oil tanker has introduced fresh uncertainty into a geopolitical landscape already fraught with multiple pressures, including the Russia-Ukraine conflict. However, while U.S. pressure on Venezuela continues to fuel market jitters, this situation may prove insufficient to sustain prices at record highs during this shortened trading week due to the Christmas holiday.

Gold Prices Hit New Highs as Geopolitical Risks Spread, but Follow-Through Momentum Remains Uncertain_1

Technical Analysis

During Asian trading hours on Tuesday, gold prices surged strongly, approaching the historic high of US$4,500 per ounce. This continued the two-month rally that began after hitting a low of US$3,886 in October. Multiple factors drove the price higher, including market expectations of an interest rate cut by the Federal Reserve, news of potential escalation in tensions between Israel and Iran, and the U.S. reimposing oil sanctions on Venezuela.

Bulls must now ensure prices hold above the intraday low of US$4,470 to advance toward the psychological barrier at US$4,500, then continue pushing toward the key resistance level at US$4,685.

However, from a technical perspective, while the MACD's upward movement is another encouraging signal, caution remains warranted as the Relative Strength Index continues to strengthen within the overbought zone.

If upward pressure subsides immediately, the first key support zone is the previous historical peak of US$4,381 reached on October 21, with the next critical support level at US$4,307. Should this support level be breached, it would signal that this rally has peaked, potentially plunging prices back into prolonged sideways trading.

Overall, the precious metals market is entering uncharted territory and may experience a Christmas rally. Both bulls and bears are setting new records, so stop-loss levels should not be set too wide. Trade within your means.

Trading Recommendations

Trading Direction: Sell

Entry Price: 4495, 4502

Target Price: 4357

Stop Loss: 4532

Valid Until: January 8, 2026 23:55:00

Support: 4470, 4442, 4429

Resistance: 4498, 4502, 4515

Risk Warnings and Disclaimers

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Tank

Forex

Technical Analysis

Summary:

Japanese Finance Minister Satsuki Katayama stated that the government stands ready to intervene in the foreign-exchange market to counter excessive one-sided moves, providing the yen with temporary support. Although stealth intervention by Japanese authorities could help the yen rebound, the recovery is unlikely to last long as investors remain cautious about the Bank of Japan(BoJ)'s monetary-policy outlook, the primary driver of the currency's weakness.

BUY USDJPY

EXP

TRADING

155.981

Entry Price

160.000

154.000

156.240 -0.787 -0.50%

0.0

Pips

Flat

154.000

Exit Price

155.981

Entry Price

160.000

Fundamentals

Japanese Finance Minister Satsuki Katayama said the government stands ready to intervene in the FX market to counter "excessive, one-sided" moves, giving the yen a short-lived lift. Although stealth Ministry of Finance (MoF) bids are expected to slow the currency's slide, the rebound is unlikely to last as investors remain wary of the Bank of Japan's (BoJ) policy trajectory, which is the main driver of yen weakness. A former Policy Board member suggested the BoJ could still deliver three more hikes before Governor Kazuo Ueda's term ends, taking the overnight call rate to 1.5%. The first move to 1.0% is pencilled in for mid-2026, contingent on U.S. growth and Japan's wage-price dynamics.

As the policy rate edges toward the neutral zone, additional tightening will become harder and face push-back from the government's reflationist camp. Tokyo is therefore trying to channel part of the $7 trillion in household financial assets into JGBs, launching new retail bond products and incentive schemes, to offset the BoJ's tapering. Retail JGB sales in FY2025 jumped 30.5% YoY to $5.28 trn, the highest since 2007, helped by rising yields. The MoF has expanded the product slate and is backing a 30-year JGB ETF to lock in individual investors for the long run. Past retail campaigns met with limited success, but the 10-year JGB yield punching through 2%, a 26-year high, and the 30-year yield topping 3% for the first time on record are proving a more compelling lure. With the central bank reducing purchases and banks constrained by capital rules, households are now viewed as the marginal buyer.

Across the Pacific, the dollar is on the back foot as markets price further Fed easing and President Trump tweets for lower borrowing costs. Fed Governor Adriana Kugler told Bloomberg TV that recent data are "consistent with a soft-landing narrative" and warned that withholding rate cuts would raise recession risk. Opposition to a 50 bp move will fade as rates decline. Traders are now looking to Tuesday's advance Q3 GDP print: the consensus is for annualised growth of 3.2%, down from 3.8% in Q2.

Technical Analysis

Daily: The Bollinger bands on USDJPY have contracted and the moving averages have flattened. After last Friday's bullish breakout above the upper Bollinger band, price has spent the past two sessions testing the mid-band, confirming the move. The short-term up-trend has resumed. A sustained hold above 155 should open a fresh test of 158–160. The MACD has printed a golden-cross with the fast-slow lines bouncing off the zero axis, signalling the correction is complete. RSI at 52 reflects a wait-and-see mood. Immediate support sits at 156.10 and 155.

Weekly: The Bollinger bands are widening upward and the moving averages are fanning out, leaving the bullish structure intact. The post-golden-cross MACD has lifted both lines back above zero, while price continues to ride the EMA12 higher classic strength. RSI at 62 shows investors are net buyers.

At this stage, traders are advised looking to buy dips while the prevailing uptrend remains in force.

FX Intervention: Are USDJPY Bulls Set for a Prolonged Retreat?_1

FX Intervention: Are USDJPY Bulls Set for a Prolonged Retreat?_2

Trade Recommendations

Trade Direction: Buy

Entry Price: 155.6

Target Price: 160

Stop Loss: 154

Support: 154.7/153.2/150

Resistance Levels: 158/158.8/160

Risk Warnings and Disclaimers

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Alan

Forex

Summary:

Yesterday, Japanese finance ministry officials signaled intervention, causing a sharp pullback in the USDJPY, but the upward trend remains intact.

BUY USDJPY

EXP

TRADING

156.051

Entry Price

160.100

154.300

156.240 -0.787 -0.50%

0.0

Pips

Flat

154.300

Exit Price

156.051

Entry Price

160.100

Fundamentals

Today, the USDJPY fluctuated around 156 amid market negotiations between Japanese policy signals, U.S. Treasury yields, and the overall strength of the dollar. Although the Bank of Japan has recently begun tightening monetary policy, the yen exhibits fragility—reflecting concerns over Japan's fiscal sustainability and long-term debt, as well as close attention to government intervention threats and short-term market volatility in a low-liquidity environment.

Following the recent rate-cutting cycle and subsequent economic data releases, the USD faced broad downward pressure, though divergence over the pace of future rate hikes led to volatility in U.S. Treasury yields. Concurrently, despite Japan raising its policy interest rate, markets interpret the increase as limited in scope and lacking a commitment to sustained tightening. Concerns over Japan's substantial fiscal expansion and refinancing risks have prevented a significant rebound in foreign investment preferences for yen-denominated assets and have instead intensified capital outflow anxieties.

Meanwhile, the Japanese Ministry of Finance and government officials have repeatedly issued warnings against unilateral and excessively rapid yen depreciation, raising the likelihood of intervention. In a low-liquidity environment usually seen during holiday periods, this has amplified yen fluctuations around key price levels.

Technical Analysis

Japanese Government's "Intervention" Only Added a Slight Hurdle to the Rise_1

In the 1D timeframe, USDJPY briefly surged to approximately 157.80 after breaking through the symmetrical triangle consolidation pattern. Yesterday, signals of intervention from the Japanese Ministry of Finance caused a pullback to the upper boundary of the triangle, with a temporary support found at the 156.00 level.

Currently, if the currency pair stabilizes around the 156.00 support zone, the bullish momentum may continue, potentially testing the 158.00 resistance level and possibly breaking above, opening an upward trajectory towards 160.00. Conversely, if the price breaks below 156.00, it could signal deeper retracement, with potential support around 154.60.

Trading Recommendations

Trading Direction: Buy

Entry Price: 156.10

Target Price: 160.10

Stop Loss: 154.30

Valid Until: January 6, 2026 23:00:00

Support: 156.00, 154.60

Resistance: 158.00, 160.00

Risk Warnings and Disclaimers

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Tank

Forex

Commodity

Summary:

During Tuesday's Asian session, silver prices printed a record high of 69.90 per ounce and were last quoted around 69.40. Escalating U.S.–Venezuela tensions are channeling safe-haven flows into precious metals, with silver a key beneficiary.

SELL XAGUSD

EXP

TRADING

69.535

Entry Price

60.000

75.000

71.238 +2.193 +3.18%

0.0

Pips

Flat

60.000

Exit Price

69.535

Entry Price

75.000

Fundamentals

U.S. President Donald Trump said Monday that the US will retain, and may sell, the oil seized in recent weeks off the coast of Venezuela, adding that Washington will also keep the confiscated vessels. Simultaneously, Ukraine continues to target Russian energy infrastructure. Its latest strike damaged two tankers and two jetties and ignited a fire in a Black Sea village. Investors are seeking shelter from the twin headwinds of escalating geopolitical tensions and shifting monetary-policy expectations. The rising threat to global trade routes and energy infrastructure is amplifying market uncertainty and reinforcing demand for precious metals as a portfolio hedge rather than a speculative punt.

Disruptions to critical infrastructure in Eastern Europe and the growing risk to energy flows are rippling through broader commodity markets. Although the immediate supply impact remains limited, analysts warn that even localized outages can intensify risk-off sentiment.

With inflation showing signs of cooling and labor-market momentum easing, futures markets now price in multiple rate cuts over the next 12 months. Lower rates typically reduce the opportunity cost of holding non-yielding assets such as gold and erode real yields, which is a key driver of precious-metal prices. Fed officials have struck a cautious tone, balancing sticky price pressures against slowing growth. Recent commentary indicates policy will remain data-dependent, and investors are laser-focused on upcoming macro releases.

Attention is now turning to U.S. growth and manufacturing gauges, including the GDP revision, durable-goods orders and payrolls. The economy is expected to have expanded at an annualized 3.2% in Q3, down from 3.8% in Q2. Economists anticipate a sequential deceleration, with manufacturing activity remaining uneven. Softer-than-expected prints would likely bolster demand for defensive assets such as gold and silver, while stronger data could provide a brief tail-wind for the dollar. For now, the precious-metals complex continues to reflect a preference for risk-resilience over outright risk-aversion.

Technical Analysis

On the 4-hour chart, bollinger bands are widening upward and the moving averages are fanning out bullishly. Price is riding the upper band; the MACD bullish crossover remains intact with no visible loss of momentum, implying the uptrend is intact. RSI at 69—price is approaching the over-bought threshold and round-number resistance near 70.

On the daily chart, bollinger bands continue to expand upward and the MA stack is still bullishly aligned, so the macro up-trend is unchanged. However, if today's session closes as a doji star, the price will pull back toward the EMA12 ( around 65). Holding that level would keep the rally alive, while a break below would shift the short-term bias to bearish. RSI is already 79, deep in over-bought territory. Lower intraday highs hint at waning momentum and a potential short-term reversal signal. Therefore, traders are advised to sell first and buy later.