Tactical Positioning for Oversold Rebound as Pessimism Exhausted

Forex

Summary:

GBP/JPY currently finds itself at a dynamic equilibrium where excessive panic selling of the pound meets persistent weakness in JPY policy shifts. Short-term bearish catalysts have been fully released, resonating with technically oversold conditions, creating an event-driven tactical window for long positions.

BUY GBPJPY

Close Time

CLOSED

196.578

Entry Price

201.500

195.200

208.323 +0.079 +0.04%

47.6

Pips

Profit

195.200

197.054

Exit Price

196.578

Entry Price

201.500

Fundamentals

The GBP faced systemic selling pressure yesterday, primarily driven by a market confidence crisis triggered by the UK's new fiscal policies. Chancellor Rachel Reeves' welfare reform bill raised concerns over fiscal discipline abandonment, causing the 10-year UK gilt yield to surge nearly 4% to 4.61% – its sharpest single-day growth in years. Though yield spikes typically support currencies, this instead amplified fears about Britain's widening deficit, sparking broad GBP selling. Prime Minister Starmer publicly backed Reeves, but political uncertainty continues to hinder confidence recovery.

Regarding the monetary policy, BoE committee member Taylor signaled potential "five interest rate cuts this year," suggesting the benchmark rate could drop to 2.75%-3.00%, significantly below current levels. This expectation is already priced in. Should today's US NFP data underperform, the US dollar's weakness may indirectly catalyze a GBP rebound, realizing the pessimism-exhausted effect.

While the JPY initially found support from BoJ member Hajime Takata’s rate-hike hints, newly appointed policymaker Kazuyuki Masu emphasized " the BOJ shouldn't be in a rush to raise rates," delaying policy normalization. Simultaneously, Trump's threat to impose 30%-35% tariffs on Japanese cars suppressed the safe-haven demand for JPY. Improving global risk appetite (e.g., sustained US equity rallies) further eroded JPY's appeal, indirectly aiding GBP/JPY bulls.

Technical Analysis

Tactical Positioning for Oversold Rebound as Pessimism Exhausted _1

The daily chart shows GBP/JPY printing successively higher highs and lows, confirming a clear uptrend. Moving averages exhibit a bullish alignment, reinforcing trend sustainability.

On the 4-hour chart, yesterday's plunge pushed RSI into oversold territory, amplifying short-term technical rebound requirements.

Current price action indicates GBP/JPY's retreat tested but respected the rising trendline during European trading hours today. The subsequent recovery confirms effective trendline support, signaling exhaustion of bearish momentum and continuation of the uptrend.

Upside targets include testing the 199.70 resistance initially, potentially reaching the psychological 200.00 level. A sustained break above 200.00 could extend gains toward 202.00.

Trading Recommendations

Trading direction: Buy

Entry price: 196.50

Target price: 201.50

Stop loss: 195.20

Valid Until: July 17, 2025, 23:00:00

Support: 195.35/194.01

Resistance: 199.70/200.00

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

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Manuel

Central Bank

Economic

Summary:

The price recently closed above the 100-period moving average at 1.3651, which, if maintained, could pave the way for a bullish continuation toward the next resistance level at 1.3768

BUY GBPUSD

Close Time

CLOSED

1.36300

Entry Price

1.37650

1.35500

1.33707 -0.00148 -0.11%

16.0

Pips

Profit

1.35500

1.36460

Exit Price

1.36300

Entry Price

1.37650

U.K. Prime Minister Keir Starmer and his government have failed to meet their welfare-cutting targets, which were a key part of their budget proposals aimed at regaining control over the UK’s government finances. PM Starmer has also left the possibility of tax increases on the table, sparking backlash from both the markets and political critics. This has led to growing speculation of more governmental instability in the U.K., with many anticipating that PM Starmer will soon begin reshuffling his cabinet to consolidate and maintain control of his party amid a challenging economic environment.

The speculation that Starmer might dismiss his finance minister, Rachel Reeves, sent 10-year bond yields soaring to 4.681%, a 25 basis point increase, marking their highest level since October 2022, when the mini-budget by Liz Truss shook the markets. Meanwhile, there is increasing speculation that Reeves will need to either raise taxes or cut spending plans in the upcoming Autumn Budget.

In the U.S., trade negotiations continue, while President Donald Trump's "One Big Beautiful Bill" remains in limbo. Trump has also once again criticized Federal Reserve Chairman Jerome Powell, calling for his immediate resignation.

In June, U.S. private payrolls fell for the first time in over two years, signaling potential headwinds for the upcoming employment report and contributing to the U.S. dollar’s decline. Data from Automatic Data Processing, Inc. (ADP) released on Wednesday showed that private-sector payrolls decreased by 33,000 in June, following a downward revision of May’s increase to 29,000. This figure was well below the market consensus of 95,000.

Economists expect Thursday’s report to show a modest increase of 110,000 nonfarm jobs in June. Additionally, the Unemployment Rate, the ISM Services PMI, and weekly initial jobless claims will be released, providing further insights into the labor market.

Furthermore, House Republicans have raised concerns over delays in the tax vote, with Andy Harris, leader of the House Freedom Caucus, casting doubt on Trump’s proposed bill. He stated, “It could take another week to get this right,” adding, “I don’t think it’s ready for July 4th.”

The White House revealed that Trump will meet with members of the Freedom Caucus and multiple Republican groups from the House, according to a senior administration official.

Meanwhile, Trump announced a trade deal with Vietnam, under which U.S. goods could be exported with zero tariffs, while the U.S. imposed a 20% tariff on Vietnamese goods and a 40% duty on reexports. Bullish Correction Looks Imminent After Recent Sell-Off_1

Bullish Correction Looks Imminent After Recent Sell-Off_1

Technical Analysis

GBP/USD has dropped sharply to the 1.3570 level, where it found support from the 200-period moving average on the 2-hour chart. From this level, GBP/USD has begun to recover and stabilize, suggesting that this support could pose a challenge for further downward momentum. The price recently closed above the 100-period moving average at 1.3651, which, if maintained, could pave the way for a bullish continuation toward the next resistance level at 1.3768, near the local high.

Additionally, the RSI dropped sharply, forming a clear divergence, with the RSI reaching a low of 24, entering oversold territory. This indicates that the downward momentum may be losing strength temporarily, which could trigger a rally. Furthermore, the 1.3590 level would act as strong support, coinciding with the 200-period moving average. On the other hand, a strong break below this level would invalidate the bullish setup, opening the door for further losses.

Trading Recommendations

Trading direction: Buy

Entry price: 1.3630

Target price: 1.3765

Stop loss: 1.3550

Validity: Jul 11, 2025 15:00:00

Risk Warnings and Disclaimers

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Manuel

Central Bank

Economic

Summary:

If the price fails to break through the trendline, we could see the start of a new bearish impulse from this area.

SELL USDJPY

Close Time

CLOSED

143.497

Entry Price

142.700

144.100

155.814 +0.255 +0.16%

60.3

Pips

Loss

142.700

144.182

Exit Price

143.497

Entry Price

144.100

The U.S. continues to negotiate trade deals while President Donald Trump’s “One Big Beautiful Bill” remains pending approval. In the meantime, Trump has once again criticized Federal Reserve Chairman Jerome Powell, calling for his immediate resignation.

Meanwhile, comments from Bank of Japan (BoJ) Governor Ueda have added to the narrative of reduced aggressiveness, as remarks from the European Central Bank’s (ECB) Sintra forum hinted at patience regarding rate hikes. Short-term interest rate markets are pricing in no change at the BoJ’s meeting on July 31, with a 15-basis-point hike expected by year-end.

On the trade front, Japan’s Chief Cabinet Secretary Yoshimasa Hayashi stated on Tuesday, "Japan will not do anything that sacrifices the agricultural sector in trade talks with the U.S."

Earlier, Japan’s Agriculture Minister Shinjirō Koizumi emphasized, “We will continue working with various ministries to maximize Japan’s national interests in the context of trade negotiations with the U.S.”

The BoJ’s Tankan survey revealed that business confidence among Japan’s major manufacturers improved for the first time in two quarters during the April-June period. Additionally, businesses expect consumer prices to stay above the central bank’s 2% target for the next five years.

Further details revealed that companies anticipate consumer prices to increase by 2.4% over the next three years and by 2.3% annually over the next five years. This highlights growing inflationary pressures in Japan, which may necessitate further rate hikes from the BoJ and could provide a solid boost to the Japanese yen during the Asian session. A New Downward Leg Could Begin from Resistance_1

A New Downward Leg Could Begin from Resistance_1

Technical Analysis

USD/JPY is currently in a strong uptrend, which recently reached a local low at 142.68. From this low, the price has retraced to the 100-period moving average, now located at 143.99. This level could act as significant resistance, potentially pushing USD/JPY lower again. Given that this area aligns with the local highs, it could mark the top of a descending channel, suggesting that USD/JPY could head back toward the local lows.

On the other hand, USD/JPY has reached the 66.85 level on the RSI, approaching overbought territory. This signals potential divergence, with the RSI making higher highs while the price remains pressured to the downside. This divergence suggests that the bullish momentum may be waning. If the price fails to break through the trendline, we could see the start of a new bearish impulse from this area.

Trading Recommendations

Trading direction: Sell

Entry price: 143.50

Target price: 142.70

Stop loss: 144.20

Validity: Jul 10, 2025 15:00:00

Risk Warnings and Disclaimers

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Eva Chen

Economic

Commodity

Summary:

Saudi Arabia's crude oil exports have surged amid OPEC+ leadership's competition for market share.

SELL WTI

Close Time

CLOSED

66.158

Entry Price

62.690

67.900

57.233 -0.408 -0.71%

174.2

Pips

Loss

62.690

67.900

Exit Price

66.158

Entry Price

67.900

Fundamentals

Saudi Arabia is exporting crude oil at the fastest pace in over a year, as the OPEC+ leader continues its strategy to regain global oil market share.

Preliminary tanker tracking data compiled by various agencies indicates that Saudi Arabia's crude oil exports increased by 441,000 barrels per day in June, reaching 6.36 million barrels per day, a rise of approximately 7%. This surge in exports coincides with OPEC+'s accelerated plan to restore oil production, which benefits consumers.

The data shows that crude oil shipments in the Persian Gulf and its key chokepoint, the Strait of Hormuz, have remained unimpeded, despite electronic interference affecting regional shipping due to the conflict between Israel and Iran. This trend may indicate a future pattern: actual export growth has surpassed OPEC+ agreement expectations during a period when domestic air conditioning demand in Saudi Arabia typically suppresses crude oil exports. As the alliance considers further production increases, the country may release a larger proportion of its supply after the summer.

Investors should monitor geopolitical developments and inventory data, as these fundamental factors often drive significant price fluctuations in the energy market.

Market Still Has Room to Fall as Supply Discharge Stacks Up with Technical Suppression_1

Technical Analysis

Following a significant correction from its recent peak of US$77.00, WTI crude oil has been trading within a narrow consolidation range, hovering around US$65.39. Market prices have found some support near a crucial level that recently curbed selling pressure.

The energy commodity appears to be stabilizing after testing key technical levels. Price action suggests a potential, albeit limited, recovery.

A clear support zone exists for WTI crude oil near the current level of US$65.50, which constitutes the recent bottom of the decline. This level, coinciding with prior swing lows, is a critical juncture in determining the next price movement.

Sustained breaches below the current level could trigger further downside momentum, while a successful hold could initiate a rebound. The breakdown of this consolidation pattern could equate to the prior decline, approximately US$3.

The Stochastic Oscillator is currently in a neutral zone, suggesting that momentum could shift in either direction. The Relative Strength Index indicates that the commodity has not yet entered oversold territory, but the oscillator has stabilized and appears to be forming a bottom. This suggests that selling pressure may be waning, which, if confirmed by volume support, could lay the groundwork for a counter-trend rally.

However, in terms of trading, we are not bullish on the price increase, as the head and shoulders top pattern has not fully played out, and we recommend continuing to go short at the highs.

Trading Recommendations

Trading Direction: Sell

Entry Price: 66.50

Target Price: 62.69

Stop Loss: 67.90

Valid Until: July 17, 2025 23:55:00

Support: 65.11, 64.55, 63.72

Resistance: 65.90, 66.94, 67.80

Risk Warnings and Disclaimers

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Warren Takunda

Commodity

Summary:

Gold prices climbed on Thursday as weaker-than-expected U.S. private sector job data from ADP revived investor hopes for a Fed rate cut later this year.

BUY XAUUSD

Close Time

CLOSED

3340.08

Entry Price

3450.00

3300.00

4299.39 +20.10 +0.47%

400.8

Pips

Loss

3300.00

3299.99

Exit Price

3340.08

Entry Price

3450.00

Gold (XAU/USD) pushed higher on Thursday, recovering from recent lows as investors reacted to a surprisingly soft U.S. labor market print and reassessed the Federal Reserve’s likely response. At the time of writing, spot gold was trading around $3,350 per ounce, supported by renewed demand for safe-haven assets and shifting interest rate expectations.

The move follows the release of the June ADP Employment Change report, which showed that the U.S. private sector lost 33,000 jobs, defying economist forecasts for an increase of 95,000. The unexpected contraction signals a possible slowdown in the labor market and comes just ahead of the more influential Nonfarm Payrolls (NFP) report, due later this week. Markets are now recalibrating expectations for Fed policy, with many traders speculating that a September rate cut is increasingly on the table.

For gold investors, the ADP miss couldn’t have come at a more opportune moment. After weeks of sideways price action and consolidation below recent highs, bullion is showing signs of renewed momentum. The disappointing jobs data prompted an immediate bid in safe-haven assets, with gold benefiting both from rate-sensitive flows and a broader risk-off tilt.

While the ADP report is not always a perfect predictor of the official government employment data, it does influence sentiment and often sets the tone ahead of the NFP release. The latest reading reinforces concerns that the post-pandemic labor market resilience may be faltering, particularly under the strain of elevated borrowing costs and slowing business investment.

If Friday’s NFP data confirms a broader hiring slowdown, it could cement expectations for the Fed to begin cutting rates as soon as September, especially if inflation also shows continued moderation. For gold, which thrives in low-rate environments due to its non-yielding nature, the prospect of policy easing represents a significant tailwind.

Despite the market’s growing conviction around a dovish pivot, the Federal Reserve remains measured and cautious. Speaking at the ECB Forum on Central Banking in Sintra earlier this week, Fed Chair Jerome Powell reiterated the central bank's data-dependent approach. “It's going to depend on the data, and we are going meeting by meeting,” he said. “I wouldn't take any meeting off the table or put it directly on the table. It's going to depend on how the data evolves.”

Powell’s comments suggest that while the Fed is not dismissing the idea of rate cuts, it is far from committed to immediate action. The central bank is keenly aware of the risks of moving too early, especially with inflation still above the 2% target. As such, the path forward remains uncertain and will hinge heavily on the next few data releases—particularly NFP, CPI, and wage growth.

Technical Analysis

From a technical perspective, gold has reasserted its bullish structure after bouncing off the 50-period Exponential Moving Average (EMA) in early Thursday trading. This dynamic support level, which had underpinned gold’s recent consolidation phase, acted as a springboard for the latest upside move. The precious metal has now exited a short-term bearish correctional channel, suggesting that the broader uptrend may be ready to resume.

Adding to the bullish case is the Relative Strength Index (RSI), which has turned higher after previously unwinding overbought conditions. This signals the return of upward momentum without the risk of excessive buying pressure—an ideal setup for trend continuation.

If the bulls maintain control, immediate resistance lies around $3,365, followed by the May highs near $3,400. A decisive break above this zone could open the door for a retest of the all-time highs closer to $3,450. On the downside, initial support sits at the 9-day EMA around $3,325. A break below that would expose the $3,300 psychological level, followed by the 50-day EMA near $3,270.

TRADE RECOMMENDATION

BUY GOLD

ENTRY PRICE: 3340

STOP LOSS: 3300

TAKE PROFIT: 3450

Risk Warnings and Disclaimers

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Eva Chen

Cryptocurrency

Summary:

The MVRV ratio is flattening, indicating insufficient short-term gains and the potential for significant price volatility. BTC price consolidation near US$108,000 reflects investor caution.

SELL BTC-USDT

Close Time

CLOSED

107445.4

Entry Price

103980.0

110000.0

90266.0 +165.3 +0.18%

2554.6

Pips

Loss

103980.0

110000.0

Exit Price

107445.4

Entry Price

110000.0

Fundamentals

Bitcoin has once again captured the attention of investors as it approaches the US$108,000 threshold, a development that could potentially reshape its market dynamics. Despite the appreciation in value, on-chain metrics such as the MVRV ratio suggest that the asset is poised for its next significant move, following recent volatility.

Specifically, recent on-chain indicators suggest a potential shift in Bitcoin market sentiment. The MVRV ratio, in particular, has stabilized after a period of sharp decline, indicating a consolidation phase following previous fluctuations. This stabilization often signals a potential market re-entry, with investors currently adopting a wait-and-see approach, awaiting further market developments.

According to CoinMarketCap, Bitcoin's current market capitalization stands at $2.14 trillion, supported by a circulating supply of 19.88 million BTC. However, as prices have risen, the 24-hour trading volume has decreased by 12.25% to US$31.58 billion, reflecting investor caution. A volume-to-market cap ratio of 1.47% is considered relatively low, indicating moderate market volatility.

Short-Term Downside Risk Has Increased, Given the Decline in Trading Volume and the Underlying Structural Weakness_1

Technical Analysis

As Bitcoin's price action consolidates within the US$100,000 to US$110,000 range, its weekly Relative Strength Index (RSI) is steadily ascending towards its upper trendline, fueling optimism for a bullish breakout and potential short-term all-time highs.

Specifically, Bitcoin's weekly RSI is approaching its upper trendline after rebounding from the lower bound of its range in April 2025. Historical data suggests that Bitcoin prices typically peak when the weekly RSI reaches this upper limit.

If Bitcoin's price continues its historical pattern, aligning with the weekly RSI's upward trajectory, it could potentially reach new highs around US$140,000.

However, our analysis indicates that the current upward trend is unsustainable. The short-term strength appears to be a temporary rally, as the market currently exhibits a four-hour bearish structure. Further upward movement is unsustainable unless the bulls can breach the US$108,371 resistance level.

Trading Recommendations

Trading Direction: Sell

Entry Price: 108,000

Target Price: 103980

Stop Loss: 110000

Valid Until: July 17, 2025 23:55:00

Support: 107236, 106361, 105133

Resistance: 108371, 108816, 109798

Risk Warnings and Disclaimers

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Eva Chen

Economic

Commodity

Summary:

Gold prices have risen for a second consecutive day, buoyed by investor optimism that the Federal Reserve will resume rate cuts later this year and as investors continue to monitor US trade negotiations ahead of the July 9 tariff deadline.

SELL XAUUSD

EXP

EXPIRED

3386.00

Entry Price

3272.00

3425.00

4299.39 +20.10 +0.47%

Pips

EXPIRED

3272.00

3348.10

Exit Price

3386.00

Entry Price

3425.00

Fundamentals

After a 1% increase on Monday, gold prices were in a buying mode on Tuesday, trading above $3,350 during the European session, as traders anticipated a higher likelihood of at least two US rate cuts in 2025.

The uncertainty surrounding the economic impact of Trump's tariff agenda and investors' rush to exit US assets have led to a nearly 11% decline in the US Dollar Index in the first six months of this year, the worst performance since 1973.

Supported by rising trade and geopolitical risks, gold prices have risen by about 25% this year and are currently less than $200 away from the record high set in April. The employment report due on Thursday could also act as a catalyst for the decline in US Treasury yields, a situation typically favorable for gold.

Critical Employment Reports Stir the Market; Can Gold Bulls Set Sail Again?_1

Technical Analysis

Gold prices received buying support on Monday from the one-month low of $3,247, boosted by a weaker US dollar and some short-sellers taking profits after a 5% drop in gold prices over the past two weeks. The strong buying was so robust that it didn't even wait until Monday's close, preventing the bearish monthly close in June that we had anticipated, indicating that the market remains strong.

However, the current buying action is merely a retreat back to the center of the trading range, and we expect the adjustment to continue. We anticipate that range-bound trading will persist until the next range opens.

Within the range, in a bullish scenario, the upside potential is limited after the strong upward movement on Monday and Tuesday, with a short-term target in the $3,286 - $3,400 range.

In a bearish scenario, if the recovery repeatedly fails to break through the $3,400 range, downside risks are still expected to persist, and short-sellers are likely to push the price back towards the recent bottom of $3,270.

As the market awaits the release of key US labor reports this week (JOLTS/ADP/NFP), short-term action may remain relatively calm, with these reports expected to provide the latest updates on the state of the US labor department and subsequently influence the Federal Reserve's rate decisions.