What Traders Need to Know

Market Overview

The previous market analysis showed moderate accuracy, with 7 directional calls confirmed in the last trading session. The major misses were in Gold and Silver, which surged instead of cooling off, with Gold reaching nearly $3,900 and Silver hitting a 14-year high due to a flight to safe-haven assets amid the US government shutdown.

The forecast for US Dollar weakness was validated, with the DXY trading lower and confirming calls for pairs like GBP/USD, AUD/USD, NZD/USD, USD/JPY, and USD/CAD. However, USD/CHF was a notable miss, closing flat despite the Dollar weakness.

Accurate: DXY, GBP/USD, EUR/USD, AUD/USD, NZD/USD, USD/JPY, USD/CAD

Missed: Gold, Silver, USD/CHF

Market Analysis

GOLD

Gold has surged past $3,900 to a new record high, fueled by extreme risk-off sentiment from the US government shutdown and rising uncertainty. The immediate resistance is at the psychological $4,000 level, while critical support is at $3,800, with near-term support at $3,890. The outlook is strongly bullish, with expectations of a move toward the $4,000 target driven by safe-haven demand.

SILVER

Silver followed Gold's lead, breaking out of consolidation to reach a 14-year high near $47.83, driven by safe-haven flows and strong long-term industrial demand expectations, maintaining a strongly bullish market sentiment.

The next major resistance is the critical psychological $48.00 level. Near-term support rests at the recent breakout high of $46.90.

The bias is Bullish, with current strength indicating a high probability of challenging $50.00 in the short term.

DXY

The DXY continued its decline, closing below 97.70, reflecting persistent bearish momentum as the US government shutdown, weak economic data (ADP jobs), and dovish Fed rate cut expectations weigh heavily on the dollar, fostering uniformly bearish sentiment.

Immediate resistance is found at 97.90, which must be overcome to relieve selling pressure. Critical multi-month support sits at the 96.94 area.

The bias remains Bearish, anticipating further weakness due to negative political and monetary fundamentals.

GBPUSD

GBP/USD sustained its firm upward momentum, trading above 1.3450, exclusively fueled by the broad-based USD weakness and maintaining a clear bullish sentiment among traders.

The pair is challenging strong long-term resistance near 1.3530. Key support is the psychological 1.3400 level, which has become a firm floor.

The bias is Bullish, with continuation expected toward 1.3500 as the DXY struggles.

AUDUSD

AUD/USD held near its recent high, confirming a strong bullish impulse driven by US Dollar selling and a hawkish fundamental shift from the RBA, despite showing technically overbought conditions, resulting in a strongly bullish sentiment.

Immediate resistance is found at the recent high of 0.6650. Critical support is the prior major S/R level at 0.6575.

The bias is Neutral/Bullish, expecting consolidation before the next leg higher, given the strong fundamental and overbought technicals.

NZDUSD

NZD/USD moved higher for a fourth consecutive session, maintaining bullish momentum primarily due to generalized USD weakness, with market sentiment cautiously bullish awaiting the next catalyst.

Key resistance sits at 0.5845. Major support is defined by the 0.5750-0.5765 range.

The bias is Bullish, with continuation expected given the persistent weak US dollar environment.

EURUSD

EUR/USD resumed its upward trend after a day of consolidation, supported by firm bullish momentum and the rotational selling pressure against the DXY, pushing market sentiment back to cautiously bullish.

The pair faces stiff resistance at the high of 1.1780 and the psychological 1.1800 level. Strong support is located at the 1.1700-1.1710 zone.

The bias is Bullish, anticipating a test of 1.1800 as DXY weakness persists.

USDJPY

USD/JPY continued its sharp move down, confirming bearish momentum as weak USD sentiment converged with a strengthening JPY on tightening speculation, leading to a bearish market sentiment.

Overhead resistance is found at 148.00, the recently broken support level. Key support is clustered at the major S/R level of 146.50-146.75.

The bias is Bearish, anticipating trend continuation driven by sustained USD weakness and JPY safe-haven flows.

USDCHF

USD/CHF continued its move down at the start of the session, exhibiting ranging momentum as US political uncertainty drives flight to the CHF safe-haven over the USD, but still maintaining a bearish sentiment.

Resistance is located at the 0.7980-0.7995 range. Key support is clustered at the 0.7930 level, followed by 0.7900.

The bias remains Bearish, anticipating the Franc to continue gaining against the pressured Dollar.

USDCAD

USD/CAD showed consolidating price action under steady USD selling momentum, pressured by generalized USD weakness combined with the strength in the commodity-linked CAD, keeping market sentiment still bearish.

Strong overhead resistance is at the confluence of 1.3960. Support is found near the major level 1.3881.