GOLD Price Analysis – Feb 06, 2025
Daily Price Outlook
Gold (XAU/USD) started to lose some of its gains but remains consolidating near its all-time peak of $2,865. However, the modest decline could be linked to the renewed strength of US dollar.
Although, the losses in the gold could be short-lived amid escalating concerns over a potential US-China trade war, triggered by President Donald Trump's tariffs. As a result, investors tend to favor gold as a safe-haven asset.
In addition, expectations for the Federal Reserve (Fed) to maintain its dovish stance and cut interest rates in 2025 have further boosted gold's appeal. The drop in US Treasury bond yields has also made gold more attractive when compared to interest-bearing assets.
Despite these bullish drivers, the positive sentiment in the stock markets has limited fresh buying interest in gold. Traders are also cautious, with gold appearing slightly overbought on the daily chart.
Gold Prices Surge Amid Economic Data and Rising US-China Tensions
Gold's impressive rally is also fueled by US economic data and the growing US-China trade war. On the data front, the ADP report showed a slightly stronger-than-expected growth of 183K private-sector jobs in January, surpassing the previous month's increase of 176K.
However, this positive news was overshadowed by a disappointing ISM Services PMI report, which dropped to 52.8, signaling slower economic growth. In response, US Treasury yields plummeted to their lowest level since mid-December, increasing the appeal of gold as a safe-haven asset.
Furthermore, expectations that the Federal Reserve will cut interest rates twice in 2025 added downward pressure on the US Dollar, sending it to a one-week low and further supporting gold’s bullish momentum.
US-China Trade Tensions Fuel Gold's Bullish Momentum as Investors Seek Safe-Haven Asset
Apart from this, the ongoing US-China trade tensions are also influencing the gold market. China recently announced a 15% tariff on US coal and liquefied natural gas (LNG) imports, and a 10% tariff on crude oil, farm equipment, and some automobiles.
In addition to these tariffs, China has imposed export controls on certain key minerals like tungsten and tellurium, which are essential for various industries.
These actions are fueling concerns about further escalation in trade conflicts, adding uncertainty to the global economic outlook. As a result, investors are turning to gold as a safe-haven asset, which has helped support its bullish trend.
The trade war is pushing Chinese manufacturers to relocate production to other countries, including the Middle East, to avoid US tariffs. This shift in production is likely to impact global supply chains and could lead to higher costs for consumers in the US.
With the uncertainty surrounding trade policies and economic conditions, gold is seen as a reliable investment. The precious metal continues to attract investors looking for a hedge against the ongoing geopolitical and economic risks, keeping its prices supported and potentially leading to further gains in the future.
Key US Data and Market Outlook for Gold
Looking ahead, traders are focusing on key US employment data for insights into the Fed's future actions. The release of the Nonfarm Payrolls report on Friday will be a key indicator of the strength of the job market and potential future Fed moves.
Additionally, the release of Weekly Initial Jobless Claims data on Thursday will offer further clues about the labor market's health.
For now, the fundamental factors remain supportive for gold. Economic uncertainty, a dovish Fed, and lower Treasury yields continue to create a favorable backdrop for the precious metal.
GOLD (XAU/USD) – Technical Analysis
Gold (XAU/USD) is trading at $2868.17, showing slight upward movement (+0.03%) as traders assess key technical levels. Despite its minor gains, the metal remains below the pivot point at $2880.17, suggesting a cautious sentiment among investors.
Immediate resistance is located at $2897.72, followed by a stronger level at $2915.92. A break above these zones could signal renewed bullish momentum, pushing gold toward fresh highs. However, failure to sustain above the pivot point at $2880.17 may invite selling pressure.
On the downside, immediate support is noted at $2859.42, with stronger support levels at $2840.59 and $2815.69. These levels coincide with recent consolidation zones and could provide a buying opportunity if prices dip.
From a technical standpoint, gold is hovering near its 50-day EMA at $2826.99, reinforcing a potential floor for the metal. If XAU/USD remains above this level, a bounce toward resistance becomes more likely. However, a sustained break below the $2840.59 support could accelerate declines, putting the focus on the $2815.69 mark.
Given the technical structure, a sell setup is favored below $2873, with a take profit target at $2847 and a stop loss at $2890 to manage risk. Short-term traders should closely watch price action around the pivot zone, as a failure to reclaim $2880.17 could reinforce a bearish outlook.
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- USD/JPY Price Analysis – Feb 06, 2025
USD/JPY Price Analysis – Feb 06, 2025
Daily Price Outlook
During the European trading session, the USD/JPY currency pair has recently faced some selling pressure but managed to regained its strength around 152.80 level as Japanese Yen (JPY) started to lose some of its recent gains, largely due to fears that Japan could also fall victim to US trade tariffs under President Donald Trump's policies.
This, combined with a risk-on market sentiment, has pushed the Yen lower. Moreover, a slight rebound in the US Dollar (USD) from a one-week low helped lift the USD/JPY pair back above the mid-153.00s range.
Japan's Economic Data and BoJ Policy Impact
The Japanese economy has recently shown signs of strength, with data released on Wednesday indicating an increase in real wages, further reinforcing expectations that the BoJ will hike interest rates.
This outlook is supported by comments from Japan's Finance Minister, Katsunobu Kato, who highlighted inflationary pressures, even though the country has not yet fully emerged from deflation.
Adding fuel to these expectations, BoJ Board Member Tamura Naoki endorsed the idea of faster interest rate hikes, suggesting a potential increase to around 1% by the latter half of fiscal 2025.
Market participants are currently pricing in a 94.8% chance that the BoJ will raise interest rates by 0.25% at its September monetary policy meeting. This would position Japan’s monetary policy tighter relative to the US, making the Yen more attractive as an investment.
Fed's Easing Bias and USD/JPY Price Action
In contrast, the US economic data has raised concerns about the health of the labor market, contributing to expectations of interest rate cuts by the Federal Reserve.
Recent figures, including the Job Openings and Labor Turnover Survey (JOLTS), showed a decline in job openings, which, along with a soft Services PMI report, suggests the US economy may be slowing down.
This has led to a pullback in US Treasury yields and a weakening of the US Dollar, which in turn pressured the USD/JPY pair.
Fed Vice Chair Philip Jefferson stated that the Fed is content with holding interest rates steady, as the central bank waits to assess the long-term impact of US trade policies. This dovish stance supports the view that the USD may struggle to appreciate in the face of growing concerns about US economic conditions.
Geopolitical Risks and Market Sentiment
Apart from this, the current risk-on market mood is another factor weighing on the Japanese Yen. Investors appear to be less focused on the Yen's safe-haven appeal, as they are more optimistic about global economic growth, particularly in the US. This has led to increased demand for riskier assets and a pullback in JPY demand.
Moving ahead, the focus will remain on the upcoming US economic data, particularly the highly anticipated Nonfarm Payrolls (NFP) report on Friday.
Hence, the stronger-than-expected employment report could provide some support to the USD, while a weaker report would likely further dampen USD prospects, keeping the pressure on the USD/JPY pair.
USD/JPY – Technical Analysis
USD/JPY is trading at 152.415, down 0.11%, as the pair remains in a corrective phase after failing to sustain momentum above key resistance levels. Price action is hovering below the pivot point at 153.203, signaling continued pressure from sellers in the short term. A decisive move above this level is necessary to confirm a bullish reversal.
Immediate resistance is seen at 153.210, followed by 154.178 and 155.333, which could act as barriers to further gains. The 50-day Exponential Moving Average (EMA) at 154.605 reinforces resistance, making a sustained break above this region crucial for renewed upside potential.
On the downside, immediate support lies at 151.087, with further levels at 150.407 and 149.771. If USD/JPY slips below 151.087, a deeper pullback could take shape, testing the lower support zones. However, the market remains in an overall uptrend, and dips toward support levels may present buying opportunities.
Given the current structure, a buy position above 151.828 is preferred, with a take profit target at 153.203 and a stop loss at 151.093 to manage risk effectively. A successful break above resistance could trigger a move toward higher targets, while a failure to hold above support may shift sentiment further bearish.
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- GOLD Price Analysis – Feb 06, 2025
GOLD Price Analysis – Feb 05, 2025
Daily Price Outlook
Gold price (XAU/USD) prolonged its upward trend and remained well bid around the 2,869 level, reaching an intra-day high of 2,870. This rise can mainly be attributed to fears over the ongoing US-China trade war, which has boosted demand for gold as a safe-haven investment. Investors are turning to gold as a protective asset amid concerns over the trade tensions between the two largest economies.
Moreover, the weakening of the US Dollar (USD), driven by expectations that the Federal Reserve (Fed) will continue cutting interest rates in 2025, is adding more momentum to gold’s rally. These factors combined are pushing gold prices higher.
Despite some positive market sentiment, such as US President Donald Trump’s decision to delay tariffs against Canada and Mexico, which typically boosts riskier assets, gold prices are still climbing.
This suggests that gold remains in demand, with the path of least resistance pointing upward. However, the price of gold could face some resistance soon, as the market is showing signs of being slightly overbought. Traders are now waiting for new US economic data to provide fresh direction for the metal’s price.
Gold Price Soars Amid US-China Trade Tensions and Weak Job Market Data
On the US front, the broad-based US dollar has been under pressure as fears of a global trade war rise, especially after China retaliated to US President Donald Trump’s new tariffs. This has boosted demand for gold, pushing its price to a fresh record high.
In addition, data from the Job Openings and Labor Turnover Survey (JOLTS) showed a slowdown in the US job market, with job openings falling from 8.09 million to 7.6 million in December. This slowdown adds to expectations that the Federal Reserve may cut interest rates further, which keeps the USD weak and supports gold’s rise.
Despite some positive news, like Trump delaying tariffs for Canada and Mexico, easing trade war tensions, gold has remained strong. Investors continue to view gold as a safe-haven asset amid ongoing trade concerns. This continued demand for gold suggests its price will likely stay supported in the short term.
However, the upcoming release of US economic data, including the ADP report and ISM Services PMI, could bring short-term volatility to the market. But all eyes will be on the US Nonfarm Payrolls (NFP) report on Friday, as it will give a clearer picture of the US labor market and could influence gold price movements.
Therefore, the ongoing trade tensions and weak US job market data support gold’s rise as a safe-haven asset. Expectations of further Fed rate cuts weaken the US dollar, which strengthens demand for gold, keeping its price elevated in the short term.
GOLD (XAU/USD) – Technical Analysis
Gold continues its upward trajectory, trading at $2,859.85, marking a 0.58% gain. The bullish momentum is underpinned by strong buying interest, as the price holds firmly above the 50-day Exponential Moving Average (EMA) at $2,806.47, signaling a robust bullish bias.
The metal's resilience amid global economic uncertainty and fluctuating U.S. dollar strength has positioned it near key resistance levels, suggesting further upside potential.
From a technical standpoint, the immediate resistance stands at $2,862.44, a critical level that, if breached, could open the path toward $2,877.51. A sustained move above this mark would likely test the next significant barrier at $2,894.42, reinforcing the bullish outlook.
Conversely, on the downside, immediate support is observed at $2,826.15. A break below this could expose gold to deeper pullbacks toward $2,808.32 and potentially $2,781.26, where buyers may re-emerge.
Momentum indicators support the bullish scenario, with the Relative Strength Index (RSI) maintaining levels above 60, reflecting strong buying pressure without signaling overbought conditions.
The Moving Average Convergence Divergence (MACD) also indicates positive momentum, as the MACD line stays above the signal line, hinting at sustained bullish energy.
Conclusion: The technical landscape favors a bullish bias with an entry price suggested above $2,850. Profit-taking is advisable around $2,870, while a prudent stop-loss placement at $2,835 helps manage downside risks amid potential volatility.
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- GBP/USD Price Analysis – Feb 05, 2025
GBP/USD Price Analysis – Feb 05, 2025
Daily Price Outlook
During the European trading session, the GBP/USD currency pair has maintained its upward trend and remained well bid around 1.2544, hitting the intra-day high of 1.2544. However, the reason for its upward trend could be attributed to the US Dollar losing some of its strength.
The Dollar weakened after US President Donald Trump decided to delay tariffs on Canada and Mexico. This move helped reduce some of the market’s worries about global trade tensions, making the Dollar less attractive to investors.
As a result, the British Pound gained against the US Dollar. Although the Pound is underperforming against most other currencies, it was able to find support against the Dollar due to the Dollar’s decline.
In addition to this, traders are cautious ahead of the Bank of England's (BoE) decision, which is expected tomorrow. This has added some uncertainty to the market, and investors are closely watching how the BoE will adjust its policy.
GBP Under Pressure Ahead of Bank of England Rate Cut Decision
On the GBP front, the Pound (GBP) has been underperforming compared to most of its major peers, except the US Dollar (USD), as investors become more cautious ahead of the Bank of England’s (BoE) decision on Thursday.
The BoE is expected to cut its key borrowing rate by 25 basis points (bps), lowering it to 4.50%. This would be the third rate cut in the current cycle. However, one BoE member, Catherine Mann, who is known for her hawkish views, might vote to keep the rate at 4.75%.
The main reason for this expected rate cut is that inflation in the UK has slowed down more than expected, especially in the services sector, which is closely watched by the BoE. In December, inflation in services rose by 4.4%, down from 5% in November.
Additionally, December's Retail Sales data showed a significant drop, which has further convinced traders that the BoE will ease its policy to help the economy.
Looking ahead, market participants are betting that the BoE may continue cutting rates by around 56 bps in total throughout the year, beyond this Thursday’s decision.
As a result, the GBP/USD pair is under pressure, as the anticipated rate cuts reduce the appeal of the Pound, while the US Dollar remains strong, holding its ground in the market.
GBP/USD – Technical Analysis
The GBP/USD pair is trading at $1.24667, down 0.09%, reflecting a cautious bearish sentiment as it struggles below the pivot point at $1.24915. The pair’s inability to maintain momentum above this level suggests sustained selling pressure.
Immediate resistance is noted at $1.25229, with additional barriers at $1.25629 and $1.26212. A break above these resistance levels could signal a potential shift toward a bullish outlook.
On the downside, immediate support is seen at $1.24281. A decisive move below this threshold could accelerate bearish momentum, targeting $1.23780 and potentially $1.23236. The 50-day Exponential Moving Average (EMA) at $1.24131 acts as a dynamic support, reinforcing the bearish bias if breached.
Technical indicators suggest a weak bullish recovery, with sellers maintaining control unless the pair closes firmly above the pivot point of $1.24915. The consistent formation of lower highs and lower lows on the 4-hour chart indicates bearish dominance.
Traders should closely monitor price action around $1.24901. A sustained break below this level offers a selling opportunity, with profit targets near $1.24275. A stop-loss above $1.25232 is recommended to manage potential reversals effectively.
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EUR/USD Price Analysis – Feb 05, 2025
Daily Price Outlook
During the European trading session, the EUR/USD currency pair extended its bullish rally, staying strong around the 1.0416 level and even reaching a high of 1.0431. The main reason behind this upward movement is the US Dollar (USD) losing strength for the third consecutive day.
The US Dollar Index (DXY), which measures the value of the Greenback against six major currencies, dropped to around 107.50. This decline came as investors felt that a potential trade war wouldn’t escalate further, which helped reduce some of the risk associated with the USD.
On the other hand, the Euro (EUR) gained some momentum, despite underperforming against other major currencies. This is mainly due to the expectation that the European Central Bank (ECB) will keep its policy-easing approach.
The ECB remains confident that inflation in the Eurozone will fall back to its target of 2% by the end of the year, which has led investors to believe that the ECB might continue its current monetary policies.
EUR Struggles Amid ECB Rate Cut Expectations and US Tariff Concerns
On the EUR front, the shared currency has been struggling against its major peers despite gaining against the US Dollar. Investors expect the European Central Bank (ECB) to continue cutting interest rates, as policymakers are confident that inflation will return to the 2% target this year.
In an interview, ECB Vice President Luis de Guindos stated that inflation is moving toward the ECB’s goal but could see a slight increase in the coming months due to energy prices. However, he remained uncertain about how low interest rates would eventually go.
Last week, the ECB lowered its Deposit Facility rate by 25 basis points to 2.75% and maintained that its monetary policy remains restrictive. Traders now anticipate three more rate cuts in upcoming meetings.
Meanwhile, concerns over the Eurozone economy continue to grow, especially with fears that the European Union (EU) might be the next target for US tariffs if Donald Trump wins the election. Over the weekend, Trump said the EU has taken unfair advantage of the US and hinted at imposing tariffs.
This uncertainty has made investors cautious about the Euro’s future. Despite these challenges, EUR/USD has managed to gain due to the US Dollar’s recent weakness.
EUR/USD – Technical Analysis
The EUR/USD pair is trading at $1.03761, down 0.02%, reflecting a modest bearish bias as it hovers below the pivot point of $1.03879.
This level acts as a critical threshold, where sustained weakness could trigger further downside momentum. Immediate resistance lies at $1.04339, followed by $1.04678 and $1.05190. A break above these levels could signal a reversal of the current bearish trend.
On the downside, the pair finds immediate support at $1.03220. A decisive move below this could open the door for further declines toward $1.02721 and potentially $1.02129, reinforcing the bearish outlook.
The 50-EMA at $1.03512 adds to the downward pressure, acting as dynamic resistance and confirming the prevailing trend.
Technical indicators suggest limited bullish momentum, with sellers maintaining control unless the euro can reclaim levels above $1.03879.
The formation of lower highs and lower lows indicates persistent bearish sentiment, with any short-term rallies likely facing resistance near key levels.
Traders are advised to watch for price action around the pivot point. A sustained break below $1.03866 could provide a favorable entry for short positions, with targets near $1.03220 and stop-loss orders above $1.04239 to manage risk effectively.
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AUD/USD Price Analysis – Feb 04, 2025
Daily Price Outlook
During the European trading session, the AUD/USD currency pair failed to continue its upward trend and turned bearish around the 0.6213 level, hitting an intra-day low of 0.6170.
However, the decline was mainly due to rising US-China trade war tensions after China retaliated against new US tariffs. China announced a 15% tariff on US coal and liquefied natural gas (LNG) imports, along with a 10% tariff on crude oil, farm equipment, and some automobiles.
Moreover, China is imposing export controls on key minerals like tungsten and molybdenum to safeguard national security. As Australia relies heavily on trade with China, these tensions increased market uncertainty, putting pressure on the Australian dollar.
Furthermore, concerns over the Reserve Bank of Australia (RBA) possibly cutting interest rates in February added to the AUD/USD pair’s weakness. The RBA has kept its Official Cash Rate (OCR) at 4.35% since November 2023, waiting for inflation to return to its 2%-3% target before easing policy.
Market expectations remain cautious, but Westpac still predicts a total of 100 basis points in rate cuts during 2025. If the RBA signals an earlier rate cut, the AUD could face further downside pressure.
AUD/USD Under Pressure from US-China Trade Tensions and RBA Rate Cut Expectations
On the AUD front, the losses in the AUD/USD pair came after market volatility increased due to concerns over the ongoing trade tensions between the US and China, Australia’s major trading partner.
President Trump hinted at speaking with China soon, but warned that if a deal wasn’t reached, tariffs could become much higher. This uncertainty around trade is adding pressure to the Australian dollar, as investors watch how these tensions will unfold.
In addition, Trump recently announced a delay in steep tariffs on Mexico and Canada after the countries agreed to deploy 10,000 soldiers to help combat drug trafficking at the US border. This decision comes right after Trump imposed heavy tariffs on goods from Mexico, Canada, and China, causing further concerns over global trade.
Meanwhile, Chinese manufacturers are shifting production to other countries to avoid these tariffs, which could affect Australia’s trade relationship with China and weaken the AUD even more.
Moreover, the Australian dollar is also under pressure from expectations that the Reserve Bank of Australia (RBA) might cut interest rates in February. The RBA has kept rates steady at 4.35% since November 2023, waiting for inflation to fall within the target range.
With economic signs such as a decline in retail sales and a lower-than-expected PMI in China, the likelihood of a rate cut has grown. Analysts now expect a 25 basis point cut in February, which could add further weakness to the Australian dollar.
US Dollar Strengthens Amid Trade Tensions, Inflation Data, and Fed Caution
On the US front, the broad-based US dollar has been stabilizing around 108.70 after losing some gains from the previous session. A key development was the announcement that President Trump signed an executive order to create a government-owned investment fund.
This fund could potentially help the US profit from TikTok if an American buyer is found. Trump has pushed for the US to acquire a 50% stake in the company, and TikTok has until early April to secure a deal.
In addition, Federal Reserve Bank of Chicago President Austan Goolsbee suggested that the Fed would need to be cautious with any rate cuts due to uncertainties, including inflation risks.
Meanwhile, data from the Institute for Supply Management (ISM) showed that the US Manufacturing PMI rose to 50.9 in January, indicating better-than-expected economic activity.
The US Personal Consumption Expenditures (PCE) Price Index also showed inflation pressures, with an annual rise of 2.6%, keeping the Fed cautious about adjusting monetary policy.
On the trade front, President Trump has threatened 100% tariffs on BRICS nations if they try to introduce a currency alternative to challenge the US dollar.
These developments, along with the Fed's cautious stance, have contributed to the strengthening of the US dollar, impacting the AUD/USD pair.
The Australian dollar is facing pressure as global trade tensions and US monetary policy uncertainties continue to shape market sentiment.
AUD/USD – Technical Analysis
The AUD/USD pair is trading at $0.61872, down 0.62%, reflecting persistent bearish sentiment as the pair struggles below the key pivot point at $0.62087.
The price action remains under pressure, with the pair facing immediate resistance at $0.62568. A breakout above this level could trigger a corrective rally toward $0.62922, with further gains potentially capped at $0.63235.
On the downside, immediate support is observed at $0.61674. A decisive break below this level may accelerate selling pressure, exposing the next support levels at $0.61324 and $0.60890.
The 50-day Exponential Moving Average (EMA) at $0.62432 reinforces the bearish outlook, acting as a dynamic resistance level. The sustained price action below this moving average indicates that sellers maintain control.
Technical indicators further confirm the downward bias. The Relative Strength Index (RSI) hovers in bearish territory, suggesting the pair is not yet oversold, leaving room for additional downside.
The Moving Average Convergence Divergence (MACD) indicator also signals bearish momentum with a widening gap between the MACD line and the signal line.
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- GOLD Price Analysis – Feb 04, 2025
GOLD Price Analysis – Feb 04, 2025
Daily Price Outlook
Gold’s price (XAU/USD) sustained its bullish trend and remained trading well around new all-time highs near the $2,820 level. However, the upticks were mainly supported by ongoing geopolitical tensions, as China retaliated against recent US tariffs.
Over the weekend, Beijing announced a 15% tariff on US energy imports like coal and liquefied natural gas (LNG) and a 10% tariff on American oil and agricultural equipment.
Moreover, China launched an antitrust investigation into Google, adding more uncertainty to global markets. This has led to a choppy trading session, with investors unsure about the long-term impact of these trade actions.
On the economic side, there are no major events before Friday’s Nonfarm Payrolls report, which could influence the Federal Reserve’s next move.
However, traders will keep an eye on JOLTS Job Openings data later in the day, which gives insights into the US job market. Also, two key Fed officials, Raphael Bostic and Mary Daly, will speak, possibly hinting at future interest rate decisions.
US Dollar Weakness and Trade Tensions Support Safe-Haven Demand Amid Economic Uncertainty
On the US front, the broad-based US dollar was unable to stop its losing momentum and remained under pressure as traders assessed economic data and Federal Reserve signals. The CME FedWatch tool showed an 86.5% chance that the Fed will keep interest rates unchanged in March, with only a 13.5% chance of a rate cut.
Fed officials, including Austan Goolsbee, emphasized the need for caution, warning that inflation could rise again. Meanwhile, US Manufacturing PMI data showed better-than-expected growth, rising to 50.9 in January, signaling expansion in the sector.
On the trade front, China retaliated against US tariffs by targeting select American companies and placing levies on US energy and agricultural products.
However, analysts believe China’s response was measured, avoiding major escalation while still sending a warning to former US President Donald Trump.
The tariffs will take effect on February 10, leaving room for potential negotiations. Meanwhile, Trump threatened 100% tariffs on BRICS nations if they introduce an alternative currency to challenge the US dollar.
Therefore, the US dollar’s weakness and ongoing trade tensions could support gold prices, as investors seek safe-haven assets. However, stronger US economic data and cautious Fed signals may limit gains, keeping gold in a consolidation phase until fresh catalysts emerge.
GOLD (XAU/USD) – Technical Analysis
Gold (XAU/USD) is trading at $2,814.11, marginally down by 0.01%, reflecting a cautious market stance ahead of key U.S. economic data releases. The price action remains above the pivotal level at $2,808.60, which continues to act as a key inflection point for traders.
Sustained moves above this pivot point suggest bullish momentum, with immediate resistance located at $2,830.19. A breakout above this level could trigger further buying interest, potentially targeting $2,848.35 and, in an extended rally, $2,871.03.
On the downside, gold finds immediate support at $2,782.04. A breach below this level could open the door for a deeper pullback toward $2,752.15 and possibly $2,730.45 if bearish pressure intensifies.
The 50-day Exponential Moving Average (EMA) at $2,772.52 offers dynamic support, reinforcing the bullish bias as long as prices hold above this key technical marker.
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USD/CAD Price Analysis – Feb 04, 2025
Daily Price Outlook
During the European trading session, the USD/CAD currency pair has failed to stop its downward trend and is still under pressure, trading around 1.4387.
The main reason for this losing streak is the strength of the Canadian Dollar (CAD). The Loonie has gained almost 2.6% from its high of 1.4800 on Monday, partly because US President Donald Trump decided to delay his plan to impose 25% tariffs on Canada and Mexico. This move helped boost the CAD, making the USD weaker in comparison.
Moreover, investors are now expecting the Bank of Canada (BoC) to cut interest rates by 25 basis points (bps) to 2.75% in its upcoming meeting in March. The possibility of this rate cut is another factor that has weighed on the Canadian Dollar, although it’s still holding strong.
On the other hand, the US Dollar (USD) has been struggling due to Trump’s decision to delay tariffs, which has reduced the Greenback's appeal as a safe-haven currency.
As a result, the US Dollar Index (DXY), which tracks the strength of the USD against six major currencies, is struggling to hold above 108.40, which was its low point from Monday.
US Dollar Weakens as Trump Delays Tariff Plans, Boosting Canadian Dollar
On the US front, the broad-based US Dollar (USD) has weakened after President Trump decided to delay his tariff plans on Canada and Mexico for 30 days.
This decision followed an agreement with his North American counterparts to tighten border restrictions aimed at preventing illegal immigration and the flow of fentanyl into the US. As a result, the Canadian Dollar (CAD) has become more attractive, strengthening sharply.
This move also suggests that Trump is using tariffs as a negotiating tool to secure better trade deals, giving the CAD a short-term boost. However, the Canadian Dollar's long-term outlook remains uncertain, as concerns grow that inflation in Canada may fall below the Bank of Canada's (BoC) 2% target.
Meanwhile, the US Dollar's safe-haven appeal has declined, pushing the US Dollar Index (DXY) lower. The DXY, which tracks the value of the USD against six major currencies, is struggling to recover from Monday’s low of 108.40.
Investors are now looking ahead to the US JOLTS Job Openings data for December, set to be released at 15:00 GMT. Economists predict that around 8 million new jobs were posted, slightly fewer than the 8.10 million in November.
This data could provide further insight into the US labor market and the USD's movement against the Canadian Dollar.
USD/CAD – Technical Analysis
The USD/CAD pair is trading at $1.44852, up 0.38%, reflecting a continuation of bullish momentum. The pair is comfortably holding above the key pivot point at $1.44525, signaling sustained buying interest.
Immediate resistance is positioned at $1.45254, with a break above this level potentially accelerating gains toward $1.45906 and $1.46681, the latter marking a significant barrier for bullish extension.
On the downside, immediate support is identified at $1.43820, followed by $1.43175 and $1.42623. A drop below these levels could trigger corrective pullbacks; however, the broader bias remains bullish as long as the pair sustains above the pivot.
The 50-day Exponential Moving Average (EMA) at $1.44369 underpins the bullish outlook, acting as dynamic support.
Additionally, the Relative Strength Index (RSI) remains in neutral-to-bullish territory, suggesting further room for upside before reaching overbought conditions.
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GBP/USD Price Analysis – Feb 03, 2025
Daily Price Outlook
During the first half of the European session on Monday, the GBP/USD currency pair continued its downward trend, dropping to around the 1.2293 level. This decline can be attributed to market concerns triggered by the imposition of tariffs on Canada, Mexico, and China by US President Donald Trump, which spooked global financial markets and prompted investors to seek safer assets.
Moreover, the British Pound showed a mixed performance against its major peers as investors shifted their focus toward the upcoming Bank of England (BoE) monetary policy decision, set to be announced on Thursday.
GBP/USD Focuses on Bank of England's Expected Rate Cut Amid Slowing Inflation and Weak Labor Demand
The Bank of England (BoE) is expected to cut interest rates by 0.25% to 4.50%. Most of the BoE's policymakers (seven out of nine) are likely to agree with this cut. However, two members, including Catherine Mann, who tends to be more cautious, may vote to keep rates the same. This decision comes as the UK shows signs of slowing inflation and weak labor demand, making the BoE consider easing its policy.
The expectation for a rate cut is based on slowing inflation and weak job demand in the UK. The UK's core Consumer Price Index (CPI), which leaves out things like food and energy, dropped to 3.2% in December. Additionally, the labor market saw a small increase of 35,000 new jobs in the three months up to November.
Therefore, the anticipated rate cut by the BoE, driven by slowing inflation and weak job demand, could weaken the GBP, leading to potential downward pressure on the GBP/USD pair in the short term.
US Dollar Strengthens Amid Tariff Concerns and Focus on Labor Market Data
On the US front, the broad-based US Dollar surged as global market sentiment worsened, particularly following US President Donald Trump's decision to impose tariffs on Canada, Mexico, and China.
This move spooked investors, leading them to flock to the safety of the US Dollar. The US Dollar Index (DXY), which measures the Greenback’s strength against six major currencies, climbed above 109.50, its highest level in over two weeks.
Trump’s tariffs included 25% on Canada and Mexico, and 10% on China, citing concerns over illegal immigration and fentanyl. While he also threatened tariffs on Europe, he softened his stance toward the UK, noting a potential deal with Prime Minister Keir Starmer.
Investors are closely watching this week's labor market data to get a sense of how long the Federal Reserve might keep interest rates steady. After last Wednesday’s meeting, Fed Chair Jerome Powell mentioned they’d only change rates if inflation improves or the job market weakens.
On Monday, traders are paying attention to the ISM Manufacturing PMI and the revised S&P Global Manufacturing PMI. The ISM PMI is expected to rise slightly to 49.5, but it’s still below the 50.0 mark, which signals the economy could be slowing down.
Therefore, the US Dollar's strength, driven by global market uncertainty and Trump's tariff decisions, could put pressure on the GBP/USD pair, potentially causing the pound to weaken against the dollar.
GBP/USD – Technical Analysis
The GBP/USD pair is trading at $1.22693, down 0.97%, reflecting sustained bearish momentum as the pair struggles below key technical levels.
The price is currently hovering beneath the pivot point at $1.23076, signaling a potential continuation of the downtrend.
Notably, the 50-day Exponential Moving Average (EMA) at $1.24076 adds further pressure from above, reinforcing the bearish outlook unless a strong reversal occurs.
If sellers maintain control, immediate support is seen at $1.22284. A break below this level could accelerate declines toward $1.21595, with $1.21054 as the next critical support zone.
Conversely, if the pair manages to recover above the pivot point, initial resistance is expected at $1.23877. Surpassing this could open the door for further gains toward $1.24541 and $1.25225, though such moves may face strong selling interest given the broader bearish bias.
The technical structure favors a bearish outlook below $1.23069, with a recommended sell entry at this level. The take-profit target is set at $1.22281 to capture potential downside momentum, while a stop-loss at $1.23565 helps manage risk in case of unexpected reversals. A sustained move above the 50-EMA would be required to shift the bias towards a more bullish scenario.
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EUR/USD Price Analysis – Feb 03, 2025
Daily Price Outlook
During the European trading session, the EUR/USD currency pair experienced downward trend, driven by the strength of the US Dollar.
The demand for the US Dollar as a safe-haven asset surged significantly following US President Donald Trump's escalating trade war rhetoric.
The US Dollar Index (DXY), which measures the Greenback's value against six major currencies, surged above the 109.50 mark. As a result, EUR/USD dropped over 1%, reaching near 1.0230 at the start of the week.
Moreover, the losses in the EUR/USD pair were further bolstered by the President Trump reiterated his threats to impose tariffs on the European Union (EU).
Over the weekend, Trump had already slapped 25% tariffs on Canada and Mexico, along with 10% tariffs on China.
He also warned of potential tariff hikes on the EU, although he did not provide further details. This uncertainty surrounding trade policies put additional pressure on the EUR/USD pair.
Trump's Tariff Threats and Economic Slowdown Pressure on EUR/USD
President Trump has once again threatened to impose tariffs on the European Union (EU), intensifying trade tensions. Over the weekend, he announced 25% tariffs on Canada and Mexico and 10% on China.
Trump further warned that similar measures could be applied to the EU, claiming that the region has “taken advantage” of the US by not buying enough American goods. He emphasized that the EU benefits more from trade with the US than vice versa, adding to concerns over the EUR/USD pair.
However, the possibility of tariffs on the Eurozone comes at a challenging time for the region. The Eurozone economy is already showing signs of slowdown, with preliminary GDP data for Q4 2024 showing no growth, following a 0.4% expansion in Q3.
Germany, the Eurozone’s largest economy, contracted by 0.2% year-over-year in Q4, highlighting the weakness. The threat of tariffs could make matters worse, putting more pressure on the euro and pushing the EUR/USD lower.
In response to these economic challenges, the European Central Bank (ECB) has been lowering interest rates. Last Thursday, it cut the Deposit Facility rate to 2.75% and signaled a clear path for further cuts.
Traders expect the ECB to make three more rate cuts by the summer. Meanwhile, inflation data from January showed mixed results, adding uncertainty to the Eurozone’s economic outlook, further weighing on the EUR/USD pair.
EUR/USD – Technical Analysis
The EUR/USD pair is trading at $1.02379, up 1.14%, reflecting renewed bullish momentum after breaking past key technical levels. The currency pair is currently hovering just above its pivot point at $1.02375, a critical level that could dictate the near-term trend.
Despite this upside movement, EUR/USD remains below its 50-day Exponential Moving Average (EMA) at $1.04228, suggesting that the broader trend is still under pressure unless a decisive breakout occurs.
If bullish sentiment persists, the next immediate resistance lies at $1.02917, a key hurdle that, if breached, could open the door towards $1.03516 and potentially $1.04340.
On the flip side, failure to sustain above the pivot point may trigger a pullback toward immediate support at $1.01770. Further downside risks include targets at $1.01249 and $1.00826, where buying interest could re-emerge.
The technical setup favors a cautiously bullish outlook above $1.02179, with an entry suggested at this level. A take-profit target is set at $1.02917, capturing potential gains from continued upward momentum, while a stop-loss at $1.01685 helps limit downside risks.
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