Today's Analysis: XAU/USD Prices Surge Above $2,400 Amid U.S. Economic Data and India's Tax Cut

Product: XAU/USD

Prediction: Increase

Fundamental Analysis:

This week, the U.S. has a busy economic schedule with key data releases. Expectations of interest rate cuts have boosted the dollar and lowered U.S. Treasury yields. Gold prices have risen, reaching above $2,400, ending a four-day decline. Spot gold prices strongly rebounded, briefly surpassing $2,410, due to India's cut in gold and silver import taxes. The Indian government announced plans to reduce the import tax from 15% to 6%, which could boost global gold demand. Experts say this move may increase retail demand and help curb smuggling in India.

Technical Analysis:

Gold prices have stopped falling, suggesting they may rise soon. The RSI is bullish, showing that buyers are gaining momentum, which could push gold prices higher. For gold to continue rising, it needs to break above $2,412. If it does, the next resistance level is $2,450, and then it may challenge the all-time high of $2,483. However, if gold falls below the July 22 low of $2,384, a deeper correction is possible. The next support level would be the 50-day Simple Moving Average (SMA) at $2,359.

Product: EUR/USD

Prediction: Decrease

Fundamental Analysis:

European Central Bank (ECB) officials have hinted at two more rate cuts this year, causing some euro buyers to step back. Now, investors are focusing on the Eurozone PMI data. This data will show if the current euro trend will continue. If the data is good, it may reduce expectations of more ECB rate cuts, possibly stopping the euro's decline. If the data is bad, the euro may face further downward pressure.

Technical Analysis:

The Euro fell early on Tuesday, pushing EUR/USD to new lows near $1.0850. The pair is trying to stabilise before important trading on Wednesday. The EUR/USD has dropped almost 1% from its recent high of $1.0948. It is still above the 200-day Exponential Moving Average (EMA) at $1.0804, but this week's drop makes it vulnerable to further declines as it moves back into a downward trend.

Product: USD/JPY

Prediction: Decrease

Fundamental Analysis:

The USD/JPY pair trades higher around $155.85, ending a two-day losing streak early Wednesday in Asia. However, the pair's gains might be limited due to growing speculation that the Bank of Japan (BoJ) will continue raising interest rates to strengthen the yen. According to Reuters, Toshimitsu Motegi, a senior ruling party official, said the BoJ should clearly communicate its intent to normalize monetary policy with steady rate hikes. This expectation might boost the Japanese Yen (JPY) against the US Dollar (USD) for now.

Technical Analysis:

Momentum favours sellers, as shown by the RSI dropping below the neutral 50 line. This means the USD/JPY is likely to move downwards. The first support level is at $155.00. If it breaks below this, it could drop to the June 4 low of $154.55, then the May 3 low of $151.86, and further down to the March 8 low of $146.48. However, if buyers push the rate above $156.33, it could rise further. The next resistance level would be at $157.00.

Product: BTC/USD

Prediction: Decrease

Fundamental Analysis:

Bitcoin's recent drop is due to Mt. Gox started to repay over 140,000 bitcoins, worth about $8.5 billion, to its creditors. According to a Telegram group of Mt. Gox creditors have started receiving Bitcoin and Bitcoin Cash (BCH) repayments via the Kraken crypto exchange. At the same time, the U.S. government moved 58.74 bitcoins, worth nearly $4 million, to Coinbase Prime, leading to speculation about its purpose.

Technical Analysis:

From a technical perspective, Bitcoin bounced back from the 50-day and 100-day moving averages over the weekend, reaching a recent high of around $68,486. This provided support for its price. However, the hanging man candlestick pattern that formed overnight suggested a possible downward trend, which has now materialised. Immediate support lies between $64,370 and $63,737, provided by the 50-day and 100-day moving averages. If Bitcoin breaks below this range, the next support to watch is at $61,751, before the 200-day moving average just above the psychological level of $60,000.

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