The GBP/USD currency pair also made a slight correction throughout Monday, but traders did not see any significant movements. As we warned, the day turned out dull and uninteresting due to a lack of macroeconomic or fundamental events. The market is now paying only a very indirect attention to geopolitical news. No one in the market is currently interested in Trump's latest promises of a deal with Iran, which are accompanied by rocket strikes in the Middle East. Thus, the market is waiting for new significant events that can help answer the questions "How will the Fed act in 2026?" and "Are there real signs of an end to the war in the Middle East?" The next event that may provide answers to one of these questions is the U.S. inflation report, which will be released tomorrow. If inflation continues to accelerate, the chances of the Federal Reserve tightening policy in 2026 will increase, thereby supporting the U.S. dollar.

From a technical standpoint, the downward trend continues. The price is below the Ichimoku indicator lines, but there is currently no trend line, and the dollar's rise on Friday might be a one-off occurrence. Geopolitics no longer supports the dollar as it did before, but in 2026, many factors are favoring the American currency. Significant reasons are needed for a new price drop.

On the 5-minute timeframe on Monday, a fairly decent sell trading signal was formed. At the beginning of the American trading session, the price bounced off with minimal deviation from the 1.3369-1.3377 area and moved down by about 10-15 pips by the end of the day. Volatility was again low.

COT Report

The COT reports for the British pound show that commercial traders' sentiment has been constantly changing in recent years. The red and blue lines, representing the net positions of commercial and non-commercial traders, frequently cross each other and are mostly close to zero. Right now, the lines are moving apart, with non-commercial traders still dominating in terms of sales. Given the events in the Middle East, it is not surprising that demand for risk currencies is low.

In the long term, the dollar continues to decline due to Trump's policies, which are clearly visible on the weekly timeframe (illustration above). The trade war will continue in one form or another for a long time, and Trump's policies are aimed, directly and indirectly, at weakening the U.S. currency. However, geopolitical factors are currently at the forefront, which have recently provided strong support to the dollar. Since the conflict in the Middle East cannot be considered resolved, the U.S. dollar may show growth in the future. According to the latest COT report (dated June 2), the "Non-commercial" group closed 4,300 BUY contracts and 13,500 SELL contracts. Thus, the net position of non-commercial traders increased by 9,200 contracts over the week.

GBP/USD Analysis 1H

On the hourly timeframe, the GBP/USD pair has ended its upward trend amid the latest tensions surrounding the Strait of Hormuz and relations between Iran and the U.S. The macroeconomic and fundamental background still does not significantly influence the pair's movements (with rare exceptions). We do not believe that, without a real escalation of the conflict in the Middle East, the dollar can show strong growth, but the U.S. currency's position is currently more favorable than that of the British pound.

For June 9, we highlight the following important levels: 1.3096-1.3115, 1.3179-1.3187, 1.3369-1.3377, 1.3465-1.3480, 1.3588, 1.3671-1.3681, 1.3751-1.3763. The Senkou Span B line (1.3437) and Kijun-sen (1.3392) may also serve as signal sources. It is recommended to set the Stop Loss at breakeven when the price moves 20 pips in the correct direction. The Ichimoku indicator lines may shift throughout the day, which should be considered when determining trading signals.

On Tuesday, important events and reports are not scheduled in the UK, while the U.S. will release the less interesting ADP report and existing home sales data. We do not expect the market to react to these reports, so today's volatility may again be low, and the price may remain near 1.3369-1.3377.

Trading Recommendations:

Today, traders may consider short positions targeting 1.3179-1.3187 if the price bounces from 1.3369-1.3377. Long positions could become relevant if consolidation above the 1.3369-1.3377 range occurs, but the Ichimoku indicator lines are in close proximity to this area, from which price may bounce.

Explanations for Illustrations:

Support and resistance price levels (resistance/support) are indicated by thick red lines, around which movement may end. They are not sources of trading signals.

Kijun-sen and Senkou Span B lines are Ichimoku indicator lines transferred to the hourly timeframe from the 4-hour timeframe. They are strong lines.

Extremum levels are indicated by thin red lines from which the price has previously bounced. They are sources of trading signals.

Yellow lines indicate trend lines, trending channels, and any other technical patterns.

Indicator 1 on the COT charts shows the size of net positions for each category of traders.

The EUR/USD currency pair corrected throughout Monday. It cannot be said that the correction was strong or even noticeable—during the day, the European currency managed to recover about 30 pips after a 120-pip drop on Friday. Thus, the market is still oriented towards buying the American currency for a number of local reasons. First, the latest set of reports from overseas was impressive. Second, the "hawkish" expectations regarding the Federal Reserve's monetary policy are rising. Third, the geopolitical conflict in the Middle East is not ending, despite Donald Trump's promises. Of course, the dollar will not rise every day, but on average, it may continue to enjoy moderate demand. On Monday, there were no significant events in either the U.S. or the Eurozone, so traders had nothing to react to throughout the day. Trump again stated that a deal with Iran could be signed soon, but the market no longer believes the U.S. president.

In technical terms, the downward trend has resumed, but whether it will continue is a big question. If Tehran and Washington somehow sign a deal, demand for the U.S. currency will fall. If inflation in the U.S. starts to slow, there will be no dilemma for the Fed about whether to tighten monetary policy, which would also weaken the position of the U.S. dollar. The next inflation report is coming out on Wednesday.

On the 5-minute timeframe, only one trading signal was formed on Monday that traders could work with. At the opening of the European trading session, the price bounced off 1.1542 and then fell by around 25-30 pips. It then returned to 1.1542 and traded around it for the rest of the day.

COT Report

The latest COT report is dated June 2. In the weekly timeframe illustration, it is clear that the net position of non-commercial traders remains "bullish" but has declined significantly due to geopolitical events. Traders have been shedding the European currency in favor of the U.S. dollar in recent months. Trump's policies have not changed, but the dollar has served as a "reserve currency" for some time. However, this process may have already concluded.

We still do not see any fundamental factors to strengthen the European currency, while there remain sufficient factors for the U.S. dollar to decline. The war in the Middle East made the dollar temporarily super attractive, but when this factor runs out of "shelf life," everything will revert to the way it was. And that shelf life may have already expired. In the long term, the euro could fall to the level of $1.08 (the trend line), but the upward trend will still remain relevant. Over the past few months, the pair hasn't come very close to this line.

The positioning of the indicator's red and blue lines indicates parity between bulls and bears. Over the last reporting week, the number of longs in the "Non-commercial" group increased by 12,400, while the number of shorts decreased by 7,000. Consequently, the net position increased by 21,400 contracts in a week.

EUR/USD Analysis 1H

On the hourly timeframe, the EUR/USD pair has resumed its downward trend. The situation in the Middle East remains tense; it is not getting worse, but Washington and Tehran cannot agree on at least a temporary peace deal. If there are no new signs of a resumption of war in the Middle East and a memorandum of understanding is signed, the dollar will begin to lose ground. But so far, we see neither a deal nor a resurgence of war.

On June 9, we highlight the following levels for trading: 1.1362, 1.1426, 1.1542, 1.1585, 1.1615-1.1625, 1.1657-1.1666, 1.1750-1.1760, 1.1786, 1.1830-1.1837, 1.1907-1.1922, as well as the Senkou Span B line (1.1637) and Kijun-sen (1.1573). The Ichimoku indicator lines may shift during the day, which should be considered when determining trading signals. Don't forget to set a Stop Loss order to break even once the price moves in the correct direction by 15 pips. This will safeguard against potential losses if the signal proves false.

On Tuesday, only secondary reports will be released in the Eurozone and the U.S. For example, Germany will release reports on the trade balance and industrial production, while the U.S. will report on weekly ADP employment and home sales. We do not expect the market to react to any of these reports.

Trading Recommendations:

Today, traders may consider short positions targeting 1.1444 if the price remains below 1.1542. Long positions can be opened if the price consolidates above 1.1542, with a target of 1.1585.

Explanations for Illustrations:

Support and resistance price levels (resistance/support) are indicated by thick red lines, around which movement may end. They are not sources of trading signals.

Kijun-sen and Senkou Span B lines are Ichimoku indicator lines transferred to the hourly timeframe from the 4-hour timeframe. They are strong lines.

Extremum levels are indicated by thin red lines from which the price has previously bounced. They are sources of trading signals.

Yellow lines indicate trend lines, trending channels, and any other technical patterns.

Indicator 1 on the COT charts shows the size of net positions for each category of traders.

The GBP/USD currency pair attempted to continue its decline from Friday to Monday, but nothing came of it. The local fundamental and macroeconomic backdrop remains favorable to the U.S. dollar, but it is not as strong as many might think. Recent macroeconomic data in the U.S. have indeed improved compared to 2025. Business activity is rising, and the labor market is recovering. Only the GDP growth rates and inflation are disappointing. However, an acceleration in inflation is also a positive signal for the American currency, as the Federal Reserve would then be more "hawkish." Thus, only the pace of economic growth raises concerns among traders at the moment.

Geopolitics remains consistently negative but is not worsening. Despite the ongoing shelling in the Middle East, a full-scale war is not resuming, and negotiations, after all, are still ongoing. Therefore, in our opinion, the dollar still lacks long-term prospects. At this point, it is essential to understand whether the market's reaction to Friday's Nonfarm Payrolls was a one-time event. In recent weeks, traders have ignored both the macroeconomic background and geopolitical factors. If the market enters the trading regime of the past few weeks, we can expect another flat and low volatility.

The British pound, like the euro, is currently in a black period. In 2026, almost everything is stacked against risk assets and currencies, so it is not surprising that they cannot sustain the upward trends seen in 2022 and 2025 for now. Nevertheless, this difficult phase will eventually end, and even the war in the Middle East will not last forever. We continue to believe that the conflict between Iran and the U.S., as well as their allies, will turn into a sluggish bickering with regular shelling and rocket strikes, but without full-scale military actions. In this case, the market is unlikely to buy dollars again solely for their "safe properties." Periodically, the U.S. dollar may appreciate, but we generally regard any increase in the dollar as a correction.

As for the British pound, it also has a few growth factors. The Bank of England is almost guaranteed to abandon further monetary policy tightening in June, and another political crisis in the UK does not make the pound more attractive to traders, as the British economy's growth rates have long been unsatisfactory. Nonetheless, the prospects for the British currency are somewhat better. Just looking at the daily timeframe makes it clear—the GBP/USD pair has been in sideways movement for nine months, and the dollar has not shown any stronger movement than a pullback or correction. This week, the American currency may receive some assistance from the inflation report due out on Wednesday, but it could equally support the British pound. On the 4-hour timeframe, the pair has not yet breached the 1.3306 level, so an upward pullback this week is quite possible.

The average volatility of the GBP/USD pair over the last five trading days is 72 pips. For the pound/dollar pair, this value is considered "average." On Tuesday, June 9, we expect movement within a range bounded by levels 1.3273 and 1.3417. The upper channel of the linear regression is directed upward, indicating a recovery of the upward trend. The CCI indicator has entered oversold territory, signaling a possible end to the downward trend.

Nearest Support Levels:

S1 – 1.3306

S2 – 1.3245

S3 – 1.3184

Nearest Resistance Levels:

R1 – 1.3367

R2 – 1.3428

R3 – 1.3489

Trading Recommendations:

The GBP/USD currency pair has resumed its downward movement. Trump's policies will continue to put pressure on the U.S. economy, so we do not anticipate long-term growth in the U.S. dollar. However, 2026 is shaping up to be very positive for the dollar due to geopolitics. Therefore, long positions with targets at 1.3489 and 1.3550 may be considered when the price is above the moving average. If the price is below the moving average line, trading to the downside with targets at 1.3273 and 1.3245 will be appropriate. The market situation often changes, and it continues to primarily track geopolitical news, which is not homogeneous.

Explanations for Illustrations:

Linear regression channels help determine the current trend. If both are directed in the same direction, the trend is strong;

The moving average line (settings 20,0, smoothed) determines the short-term trend and the direction in which trading should be conducted;

Murray levels are target levels for movements and corrections;

Volatility levels (red lines) are the probable price channels within which the pair will stay for the next 24 hours, based on current volatility indicators;

The CCI indicator entering the oversold zone (below -250) or the overbought zone (above +250) indicates an approaching trend reversal in the opposite direction.

The EUR/USD currency pair traded quite calmly on Monday, with the U.S. dollar failing to extend Friday's momentum, and volatility once again fell to minimal levels. Despite a steady stream of geopolitical news, traders are still hardly reacting to it. On Monday, it became known that Iran launched rocket strikes against Israel, marking the first such attacks since the ceasefire agreement came into effect in early April. Thus, it's time to talk about the escalation of the conflict and the resumption of war rather than expecting a ceasefire anytime soon.

However, as mentioned, the market hardly reacted to this new violation of the temporary ceasefire in the Middle East, as it essentially does not affect anything. The parties to the conflict still cannot agree on a deal, and negotiations continue despite regular shelling from both "rebels," with the Strait of Hormuz remaining blocked. Therefore, one more strike or one less does not matter. In general, the market has reacted only to one event in the past three weeks—the NonFarm Payrolls report released on Friday. This report did indeed show positive figures, indicating not only a recovery in the U.S. labor market but also allowing the Federal Reserve to move faster toward inflation containment.

We doubt that the tightening of the Fed's monetary policy is a foregone conclusion by the end of the year, as we still do not know what position new chair Kevin Warsh will take and how he will influence the entire FOMC. Therefore, we would not rush to conclusions. However, the fact remains—a hawkish sentiment is strengthening in the market, which could further support the American currency.

This sentiment may grow stronger this week, as the May inflation report will be released on Wednesday, and the index may show a third consecutive acceleration, this time to 4.2%. This will be yet another reason for the Fed to tighten monetary policy faster than the market currently anticipates. Thus, geopolitics is clearly on the dollar's side at the moment, and key indicators influencing the Fed's monetary policy are also in the dollar's favor.

We do not expect significant growth for the American currency in 2026, but in the first half of the year, almost everything is falling in its favor. Modest growth for the U.S. dollar is possible, but in the long term, any increase in the currency will be a correction. Let's remember that Bitcoin corrected for three months before the new decline, and many traders did not believe in a new crash. However, the correction ended, and Bitcoin fell again. The same could happen with the dollar. It may continue to correct for another six months, but the global fundamental backdrop still points to a rather cloudy future for the greenback.

The average volatility of the EUR/USD currency pair over the past five trading days, as of June 9, is 63 pips, which is considered "average." We anticipate that the pair will move between levels 1.1480 and 1.1606 on Tuesday. The upper channel of the linear regression has turned upward, indicating a trend change to bullish. The CCI indicator has entered the overbought zone and has formed two "bearish" divergences, warning of the onset of a downward correction that is still not complete. On Friday, it entered the oversold zone, warning of a possible end to the correction.

Nearest Support Levels:

S1 – 1.1536

S2 – 1.1475

S3 – 1.1414

Nearest Resistance Levels:

R1 – 1.1597

R2 – 1.1658

R3 – 1.1719

Trading Recommendations:

The EUR/USD pair continues its downward movement, presumably a correction within the context of a global upward trend. The global fundamental backdrop for the dollar remains extremely negative, with only the geopolitical factor regularly supporting it. For prices located below the moving average, shorts may be considered with targets at 1.1480 and 1.1475. Above the moving average line, long positions are relevant with targets at 1.1719 and 1.1780. The market continues to pull away from geopolitical factors, but in recent weeks, the dollar has been in demand as hopes for peace in the Middle East have weakened.

Explanations for Illustrations:

Linear regression channels help determine the current trend. If both are directed in the same direction, the trend is strong;

The moving average line (settings 20,0, smoothed) determines the short-term trend and the direction in which trading should be conducted;

Murray levels are target levels for movements and corrections;

Volatility levels (red lines) are the probable price channels within which the pair will stay for the next 24 hours, based on current volatility indicators;

The CCI indicator entering the oversold zone (below -250) or the overbought zone (above +250) indicates an approaching trend reversal in the opposite direction.

The American dollar has been feeling quite well in recent weeks, but the market is all about waves and cycles. After a bullish cycle, a bearish one follows, and trends depend on the strength of each cycle. For the EUR/USD instrument, we have seen a complete five-wave trend segment, so it is now permissible to expect the formation of a bullish segment. Can the American news background support the euro and pound against the dollar? Let's sort it out.

Last week, a considerable amount of important statistical data was released in America, but the market hardly noticed most of it. Only the Nonfarm Payrolls report garnered attention. Consequently, the market continues to filter many reports, and the dollar cannot count on strong support from economic data. This week in America, a May inflation report will be released, and only this report may elicit a market reaction similar to that of the Nonfarm Payrolls report. Market participants expect U.S. inflation to continue rising, bringing the Federal Reserve closer to tightening monetary policy. Core inflation is expected to spike from 4.2%, while the core rate may rise to 2.9%. If the actual figures turn out to be higher, it will further bolster the market's "hawkish" expectations. This is a supportive factor for the dollar. Therefore, for us to build a bullish wave set, we need inflation to at least remain within the projected range.

My readers may also pay attention to the PPI report on Thursday. This index will show how much producers have raised prices in May, which will naturally be reflected in subsequent inflation reports. The logic is the same: the higher inflation, the greater the chances of a further strengthening of the American currency.

In addition, the market will certainly continue to closely watch geopolitical developments. It is now even more interesting to see if Trump's latest promise of ending the conflict with Iran will materialize soon. So far, I see only regular rocket attacks in the region. However, if it happens, it will be much easier for the euro and pound to rise. The dollar still enjoys its status as a "safe haven," but aside from that, it currently has few strong advantages.

Wave Picture for EUR/USD:

Based on the analysis of EUR/USD, I conclude that the instrument remains within a bullish trend segment, while in the shorter term, it is within a downward trend segment that may already be complete. In my view, this is a good time to try to form long positions. An unsuccessful attempt to break the 1.1513 mark, which corresponds to 76.4% on the Fibonacci scale, combined with the completed appearance of the downward trend segment, suggests that the instrument will transition to forming a bullish wave set with targets around the 17 figure and higher.

Wave Picture for GBP/USD:

The wave picture for the GBP/USD instrument has become clearer. Currently, the instrument has formed three downward waves, while the EUR/USD instrument has formed five. Therefore, the pound may be limited to constructing a corrective structure, and both currency pairs may begin building bullish trend segments. At this point, it is only an assumption, but a probable one. If correct, the instrument will start rising with targets around the 35 figure and above. Market participants currently have a good opportunity to buy.

Key Principles of My Analysis:

1. Wave structures should be simple and clear. Complex structures are difficult to play because they often require changes.
2. If there is uncertainty in the market, it is better not to enter.
3. There is no 100% certainty in the direction of movement, nor can there ever be. Do not forget about protective Stop Loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.

The British pound begins a new week on a somewhat gloomy note. Last week ended with a predicted collapse, but not due to the Nonfarm Payrolls report, rather because of the wave analysis. I mentioned earlier that single corrective waves are rare. Therefore, the GBP/USD instrument was expected to form at least a three-wave structure. The decline in quotes on Friday led to the formation of wave 3 or C. Based on all of the above, the pound may improve its position in the near future, and the European currency, which is presumably completing its downward wave set, may aid it in this.

What interesting events await us in the UK this week? Virtually nothing. Only some reports will be released on Friday that deserve attention, but even those are unlikely to affect the pound's short-term prospects or the wave structure. The British news background ranks third after geopolitics and American data, so it receives little attention. On Friday, reports on GDP and industrial production for April will be released in the UK. The values reported are likely to be weak again. Therefore, the pound cannot expect significant support.

However, it currently has a favorable wave structure and possibly even geopolitical factors, though it's hard to believe. I have frequently stated that geopolitics largely supports the U.S. dollar, but the dollar cannot rely solely on this factor to sustain market trust. Currently, Donald Trump continues to insist that an agreement with Iran is nearly achieved. Although there is no trust in the American president, according to the theory of probability, he cannot constantly make false or misleading statements. Therefore, sooner or later, Trump will be right about the conflict's resolution, and the market may occasionally listen to him. Why not now, when the wave analysis is favorable for both the euro and the pound?

Based on all of the above, geopolitics and the American news background will be significant for the GBP/USD instrument this week. The pound has chances for growth, but a successful attempt to break through the 33 figure (the low of wave 1 or A) will indicate that wave 3 or C may take a more extended form.

Wave Picture for EUR/USD:

Based on the analysis of EUR/USD, I conclude that the instrument remains within a bullish trend segment, while in the shorter term, it is within a downward trend segment that may already be complete. In my view, now is a good time to try to form long positions. An unsuccessful attempt to break the 1.1513 mark, which corresponds to 76.4% on the Fibonacci scale, combined with the completed appearance of the downward trend segment, suggests that the instrument will transition to building a bullish wave set with targets around the 17 figure and higher.

Wave Picture for GBP/USD:

The wave picture for the GBP/USD instrument has become clearer. Currently, the instrument has formed three downward waves, while the EUR/USD instrument has formed five. Therefore, the pound may be limited to constructing a corrective structure, and both currency pairs may begin building bullish trend segments. At this point, it is only an assumption, but a probable one. If correct, the instrument will start rising with targets around the 35 figure and above.

Key Principles of My Analysis:

1. Wave structures should be simple and clear. Complex structures are difficult to play because they often require changes.
2. If there is uncertainty in the market, it is better not to enter.
3. There is no 100% certainty in the direction of movement, nor can there ever be. Do not forget about protective Stop Loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.

The European currency found itself in a knockout at the end of last week, but may rise from the ashes shortly. As I mentioned, the wave structure of the downward segment of the EUR/USD trend looks complete, so the European currency may build a bullish wave set in the near future. Undoubtedly, the strengthening of the euro will largely depend on geopolitical factors. Therefore, if Iran and the U.S. manage to agree on a memorandum of understanding, negotiate another ceasefire, and unlock the Strait of Hormuz, it will provide significant support for all risk currencies, including the pound and the euro. Conversely, if the conflict persists along with the blockade of the strait, the European currency may only anticipate a corrective wave set, after which a new impulsive downward segment of the trend will begin.

This week, there will be several important events in the European Union, but I will focus my attention on the most crucial one – the European Central Bank meeting. At the beginning of the week, the market is confident that the ECB will raise interest rates by 25 basis points on Thursday. This has been reiterated recently by several ECB officials, although not all. There may be a few opponents of tightening monetary policy on the ECB Board, but the "hawks" are likely to prevail.

In my opinion, an increase in ECB rates will support the euro, which is currently set on a bullish trajectory, regardless. The market often prices events in advance; however, this is not the case now, as demand for the euro has been declining in recent weeks. Therefore, the ECB's policy tightening, already known, has not yet been priced in by market participants. If this assumption is correct and geopolitics does not lead to a new collapse, the euro could have good prospects ahead.

It is also important to consider what signals the ECB and Christine Lagarde are sending to the market. The central bank may raise rates once, or it may be preparing for a whole cycle of increases, given that inflation in the EU has been rising for five consecutive months. The conflict in the Middle East is not ending and is much closer to escalation than to a peace agreement. Consequently, oil prices are unlikely to decrease in the near term, and inflation may continue to accelerate.

Wave Picture for EUR/USD:

Based on the analysis of EUR/USD, I conclude that the instrument remains within a bullish trend segment, while in the shorter term, it is within a downward trend segment that may already be complete. In my view, this is a good time to try to establish long positions. An unsuccessful attempt to break through the 1.1513 mark, which corresponds to 76.4% on the Fibonacci scale, combined with the completed appearance of the downward trend segment, suggests that the instrument will transition to forming a bullish wave set with targets around the 17 figure and higher.

Wave Picture for GBP/USD:

The wave picture for the GBP/USD instrument has become clearer. Currently, the instrument has formed three downward waves, while EUR/USD has formed five. Therefore, the pound may be limited to constructing a corrective structure, and both currency pairs may begin building bullish trend segments. At this point, it is only an assumption, but a probable one. If correct, the instrument will start rising with targets around the 35 figure and above. Market participants currently have a good opportunity to buy.

Key Principles of My Analysis:

1. Wave structures should be simple and clear. Complex structures are difficult to play because they often require changes.
2. If there is uncertainty in the market, it is better not to enter.
3. There is no 100% certainty in the direction of movement, nor can there ever be. Do not forget about protective Stop Loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.

The weakening of the Japanese currency is justified and well-founded, considering recent events in the Middle East. As is known, Japan is a net importer of energy resources; therefore, the latest round of Middle Eastern confrontation has had a negative impact on the yen. At the start of Monday's trading, global oil prices rose by more than 5% — in particular, the cost of a barrel of Brent oil surged above $98 (the first time since June 3).

As is known, Iran and Israel exchanged rocket strikes within a day, thus jeopardizing the fragile truce in the Middle East. Against the backdrop of a sharp surge in anti-risk sentiment and rising oil prices, the USD/JPY pair climbed to the middle of the 160 range.

However, buyers could not consolidate in this price area. After the price settled at 160.40, sellers seized the initiative in the pair. The yen gradually strengthened and eventually returned to the 159 range.

Interestingly, the pair began to decline for nearly the same reason it previously rose. Only the sign "minus" changed to a "plus." Initially, the market reacted to the risks of further escalation and the expansion of conflict in the Middle East; however, signals of possible de-escalation soon emerged. In other words, the geopolitical agenda remains the key driver for USD/JPY, but its tone has shifted from alarming to more positive.

First, the United States did not support the escalation scenario, signaling that the basic scenario for developments is diplomacy. Donald Trump refrained from making threats against Tehran and urged Israel not to retaliate for the Iranian rocket attack. And although the Israeli side "disobeyed" the White House (the IDF attacked Iranian facilities overnight), Washington continues to insist on de-escalation. On Monday, Trump stated on his social media that Israel and Iran "are striving for a truce."

Second, de-escalation signals also came from Tehran. Essentially, Iran announced the cessation of rocket strikes against Israel. According to media reports, representatives of the Israeli leadership and the U.S. previously relayed to Tehran that in the event of a halt to attacks, retaliatory strikes would also be stopped. Judging by the Iranian armed forces' statement, this offer was accepted: Tehran officially announced the cessation of operations. According to Israeli Channel 12, after this announcement, Trump and Benjamin Netanyahu held another phone call, thereby "cementing" the agreements reached. According to the NYT, the Israeli Prime Minister instructed the military to stop preparations for a new attack on Iran.

Against the backdrop of these messages, the USD/JPY pair fell nearly 50 pips, retreating from five-week highs.

An additional factor putting pressure on the pair is the risk of currency intervention. After all, the level of 160.00 is a kind of "red line" for the Japanese authorities. It was here at the end of April (when USD/JPY jumped to 160.70) that the Japanese Ministry of Finance deployed a record 11.7 trillion yen from its foreign exchange reserves to strengthen the national currency. The fact that the pair has returned to local highs indicates that the entire effect of the spring inflows has been completely neutralized.

Previously, in 2022–2024, actual (not verbal) interventions also occurred near price ranges of 150-160, which formed what traders refer to as a "range memory." Therefore, the market may begin to reduce long positions in anticipation of approaching the upper boundary of this range — in this case, the aforementioned level of 160.70.

Given the current circumstances, one should not underestimate the risk of renewed currency intervention. A weak yen drives up imported inflation in Japan, increasing business and household expenses for purchasing energy resources, thereby nullifying government efforts for budgetary support to the population. Apparently, Prime Minister Sanae Takaiichi and Finance Minister Satsuki Katayama are under serious political pressure within the country, as they have recently significantly tightened their rhetoric, stating their readiness to "take decisive measures" against excessive volatility and speculative movements in exchange rates.

It is also worth noting that just last Friday (June 5), the Japanese parliament passed an additional budget of 3.11 trillion yen (approximately $19 billion) in an urgent vote. The Takaiichi government undertook this just two months after the approval of the main annual budget. The devaluation of the yen, in this context, intensifies the burden and partially negates the stimulus package's effect, since rising prices for imported energy and raw materials increase the real cost of the budget and reduce purchasing power, diminishing the multiplier effect of additional government spending. It is evident that further USD/JPY growth may prompt retaliatory measures by the Japanese authorities.

Thus, long positions on the pair seem risky despite the ongoing tensions in the Middle East. Trump's peacekeeping efforts appear to be yielding some results — at least in terms of holding back further escalation. Moreover, the USD/JPY pair is approaching a high-risk zone, increasing the likelihood of currency intervention. Under these conditions, it would be advisable to adopt a wait-and-see position on the pair: further growth is associated with heightened risks, while the fundamental prerequisites for a sustainable reversal have yet to materialize.

The combination of rising geopolitical risks and strong U.S. macroeconomic data created an ideal environment for the strengthening of the U.S. dollar. Oil prices rose amid the escalation of the conflict in the Middle East. Iran is dictating its terms to the White House. It demands payment for the transit of tankers through the Strait of Hormuz and links the deal with Washington to Israel's commitment not to attack Hezbollah, which is based in Lebanon. Why?

Dynamics of U.S. presidential ratings

Tehran is skillfully playing on Trump's desires. The U.S. president is under pressure from American voters who are extremely dissatisfied with events in the Middle East. Republicans risk losing elections in the fall. It is not surprising that the White House is trying in every way to tame militant Israel.

However, Netanyahu has his own elections. The opposition calls him an American puppet and claims that he has sold Israel's sovereignty.

As a result, a Gordian knot is created, which Trump has yet to untangle. This indicates further closure of the Strait of Hormuz, increasing the risk of a rally in Brent prices and strengthening the U.S. dollar amid talks of an increase in the federal funds rate. The futures market indicates a 75% probability that this will happen in 2026. The chances of two acts of monetary restriction are estimated at 32%.

Dynamics of speculative positions on the U.S. dollar

High demand for safe-haven assets and expectations of a Federal Reserve rate hike are far from the only strong points for the "bears" on EUR/USD. The U.S. economy looks much better than the European one, partly because of its geographic distance from the two largest armed conflicts of the 21st century — in Ukraine and the Middle East.

Strong data on the U.S. labor market confirms this. From March to May, private-sector employment grew by an average of 188,000 jobs. This marks the indicator's dynamics returning to their highest levels since March 2024. Thus, the difficulties in the labor market at the end of 2025, when the Fed was lowering rates, were temporary, driven by tariffs, anti-immigration policies, and mass cuts in government employment. These difficulties have now been overcome.

Technically, on the daily chart, EUR/USD is attempting to find a bottom for the "bulls" after the most significant blow in three months. Key resistances are near the pivot level of 1.1555 and the lower boundary of fair value at 1.1575. A rebound from these levels will provide a basis for increasing previously opened shorts.

Donald Trump was disappointed by the decline in stock indices in response to strong U.S. labor market data. In his view, the S&P 500 should be rising, yet it fell. Investors were frightened by the potential increase in the federal funds rate, although in reality, the rate needs to be lowered. Investors ignored the words of the White House owner — the Nasdaq Composite recorded its worst daily performance in over a year. Its decline provided temporary support to BTC/USD.

Dynamics of Bitcoin and Nasdaq

Prior to this, Trump stated that the deal with Iran was at the final stages of negotiations. However, other information was coming from Tehran. Supposedly, there was no progress in the talks, and payment was required for transit through the Strait of Hormuz. Washington is unlikely to be pleased by this news. The U.S. president is trying to downplay the resumption of hostilities between the Islamic Republic and Israel. He is very eager to sign a peace agreement, and his opponents are taking advantage of this.

Trump's words no longer command trust, and along with them, Bitcoin's trust is also diminishing. The drop in BTC/USD by more than half from record highs has forced crypto funds to struggle to survive. Their market value has fallen from a peak of $134 billion to $72 billion. As a result, companies that promised never to sell tokens face a difficult choice: either reduce their holdings or default.

Dynamics of crypto fund capitalization

The first to falter was the industry leader — Strategy by Michael Saylor. The company sold Bitcoin for $2.5 million for the first time in four years. While this amount is small relative to the volume of holdings, the mere fact of it triggered an avalanche of sell-offs.

Investors withdrew $4 billion from Bitcoin-focused ETFs during the longest historical streak of 12 consecutive days of outflows from specialized exchange-traded funds. They are reallocating capital to the U.S. stock market, favoring artificial intelligence technologies over digital assets. It is not surprising that the Nasdaq Composite's retreat allowed BTC/USD to find a bottom. However, I do not think the crowd will continue to sell equity securities. They will likely buy the dip very soon.

Technically, on the daily chart, BTC/USD is testing fair value and forming an inside bar. Traders might consider setting pending buy orders from 63,800 and sell orders from 62,400. Activation of one of these will allow for a trade. A re-entry is permitted in case of a single execution of the stop order.

On the lower time frame, I can identify a classic three-wave bullish corrective structure. Following its completion, a new downward trend segment began to form, which, logically, should be impulsive in nature. If this assumption is correct, we should expect a five-wave structure within wave C of the higher degree, targeting levels below the 1.1400 level. Are there fundamental reasons to expect such a strong appreciation of the US dollar? Not definitive ones, but the market is gradually losing confidence in a deal between the United States and Iran, which is supporting sellers.

The EUR/USD pair changed very little during Monday's session, and price fluctuations remained limited. This is neither surprising nor unusual, as there were no economic releases or major events scheduled today, while the market is increasingly paying less attention to geopolitical headlines.

Today, Iran and Israel exchanged new missile strikes, the first such attacks since the temporary ceasefire was established. Therefore, in my view, both sides continue to move steadily toward further escalation of the conflict or, at the very least, a prolonged and exhausting confrontation—not toward a peace agreement. As a result, the U.S. dollar remains the preferred currency among market participants, while today's minor decline in the dollar should be viewed as nothing more than a correction following Friday's rally.

However, it is also possible that the dollar's advance has already ended, as EUR/USD has completed a five-wave decline. Naturally, the downward trend segment could become more extended and complex if geopolitical developments continue to signal a lack of progress toward resolving the Middle East conflict. Nevertheless, from a wave-analysis perspective, the five-wave structure appears complete. Therefore, at least three corrective waves to the upside can be expected.

Meanwhile, Donald Trump continues to insist that a deal with Iran could be reached in the near future and has even asked Israeli Prime Minister Benjamin Netanyahu not to launch retaliatory strikes against Iran. Notice how the U.S. president's rhetoric has changed: from "we will destroy Iran" to "please do not strike Iran; we need a deal."

The White House leader clearly understands that the longer the conflict lasts, the lower his chances of maintaining full political control in the United States. Elections are only five months away, while Trump's approval ratings—and, consequently, those of the Republican Party—continue to deteriorate. Trump urgently needs to bring the conflict to an end, declare victory, and sign a nuclear agreement. It increasingly appears that Washington may have to make the key concessions during the negotiations.

General Conclusions

Based on my EUR/USD analysis, I conclude that the instrument remains within a bullish trend segment (lower chart), while in the shorter term it remains within a downward trend segment that may already be complete.

In my opinion, the current environment offers a reasonable opportunity to consider long positions. A failed attempt to break below the 1.1513 level, which corresponds to the 76.4% Fibonacci retracement, combined with the apparent completion of the downward trend segment, suggests that the instrument may begin forming a new bullish wave sequence targeting the 1.1700 level and above.

On the higher time frame, a bullish trend segment remains visible, followed by the development of a corrective wave structure. In the near future, wave C is expected to form with targets near 1.1352, which corresponds to the 38.2% Fibonacci retracement level. Once the A-B-C structure is completed, a new long-term bullish trend may begin.

Key Principles of My Analysis

1. Wave structures should be simple and easy to interpret. Complex structures are difficult to trade and frequently undergo revisions.
2. If there is no confidence in the market situation, it is better to stay out of the market.
3. There can never be absolute certainty regarding market direction. Always use protective Stop Loss orders.
4. Wave analysis can be combined with other analytical methods and trading strategies.

The EUR/USD pair spent two weeks trading within Imbalance 13, attempting to form a buy signal within that zone. However, the bulls failed to find sufficient grounds for a new advance, and Friday's Nonfarm Payrolls report effectively invalidated their efforts. As a result, the pair fell well below Imbalance 13, rendering this pattern invalid. The only active signal that remains is the one formed within Imbalance 15, but it is a bearish signal within what is still considered a bullish trend.

Naturally, I am not suggesting that readers avoid buying the U.S. dollar. The U.S. currency has been in demand throughout 2026, which means its appreciation may continue. However, in my view, once the conflict in the Middle East is resolved, the dollar will lose a significant portion of its appeal among traders.

Unfortunately, there are still no signs that the conflict in the Middle East is nearing an end, and Tehran and Washington remain unable to find common ground. On Monday, Iran carried out its first strikes against Israel in two months in response to Tel Aviv's attack on Beirut, once again putting negotiations and a potential peace agreement at risk. However, such developments are no longer particularly surprising, as both sides regularly carry out strikes and appear more concerned with avoiding any display of weakness than with preserving the negotiation process. As a result, the dollar continues to enjoy preference among traders due to geopolitical considerations.

In the near future, market sentiment and the direction of the pair will continue to depend primarily on geopolitical developments. If Tehran and Washington ultimately sign a memorandum of understanding, extend the ceasefire, and make progress on the nuclear issue, the bears may be forced to retreat, allowing the euro and the pound to resume their upward movement. However, the probability of such an optimistic scenario appears to be declining with each passing day.

Under the current circumstances, traders may focus on bearish patterns. A new bearish imbalance may be formed by the end of today's session. However, if an agreement between Iran and the United States is eventually reached, the euro could resume its advance in line with the broader bullish trend despite the presence of bearish patterns. At this stage, however, it remains unclear how far the euro may decline before that occurs. The current technical picture now provides considerably stronger support for the U.S. dollar.

Once again, I must emphasize that the entire rally in the U.S. dollar between January and March was driven primarily by geopolitical developments. As soon as the United States and Iran agreed to a ceasefire, bears immediately retreated, and bulls dominated trading for more than a month. At present, the likelihood of reaching an agreement appears to be declining once again, while the market remains highly skeptical of any reports suggesting a quick resolution to the conflict or a comprehensive agreement between Iran and the United States. Consequently, geopolitics continues to exert underlying pressure on EUR/USD.

There was no meaningful economic data on Monday. The first notable event of the week will arrive on Wednesday with the release of the U.S. inflation report. In the eurozone, the European Central Bank will hold its policy meeting on Thursday, which could support the bulls, as the ECB is highly likely to decide in favor of further monetary tightening.

Bulls still have numerous reasons to remain active in 2026, and the outbreak of conflict in the Middle East has not significantly reduced them. From a structural and long-term perspective, Trump's policies, which contributed to the sharp decline of the dollar last year, have not fundamentally changed. In the coming months, the U.S. dollar may periodically strengthen due to risk-off flows, but this factor requires continued escalation of the conflict in the Middle East. I still do not believe in the emergence of a sustained bearish trend for EUR/USD. The dollar has received temporary support from the market, but what factors can provide bears with long-term momentum?

News Calendar for the United States and the Eurozone:

• Germany – Industrial Production (06:00 UTC).
• United States – Existing Home Sales (14:00 UTC).

The economic calendar for June 8 contains only two secondary events. Therefore, the impact of the economic backdrop on market sentiment on Tuesday is expected to be minimal.

EUR/USD Forecast and Trading Recommendations:

In my view, the pair remains in the process of forming a bullish trend. The fundamental backdrop changed sharply three months ago, but the broader trend cannot yet be considered invalidated or completed. Therefore, bulls may well resume their advance in the near term if they receive even modest support from geopolitical developments.

At present, traders can only maintain short positions initiated from Imbalance 15 and wait for new patterns to emerge. The decline in the pair is being prolonged by objective factors, although without the strong U.S. labor market and unemployment data, the support zone of Imbalance 13 would most likely have held. However, it failed to hold, giving bears an opportunity to launch a more substantial offensive. Geopolitics remains the key driver.

The GBP/USD pair has an excellent opportunity to continue its decline after reacting to Bearish Imbalance 19 following two weeks of trading within it. Undoubtedly, Friday's bearish momentum was fueled by U.S. economic data, which turned out to be unexpectedly strong. I believe few market participants expected such robust Nonfarm Payrolls figures for April and May. However, the U.S. labor market in 2026 is performing considerably better than it did last year, which continues to support the U.S. dollar.

Geopolitical developments are also currently favoring the dollar, as Tehran and Washington remain unable to sign even an interim agreement concerning peace and the reopening of the Strait of Hormuz. As a result, the dollar remains in a more advantageous position compared to the euro and the pound. Although the current chart structure appears fairly straightforward and points toward further downside in the pair, I would caution traders against drawing overly confident conclusions.

On Friday, the dollar received substantial support from the market, but no one knows how events in the Middle East will develop. If an unexpected breakthrough occurs and Donald Trump ultimately reaches an agreement with Iran, demand for the safe-haven dollar could immediately begin to decline. Thus, the bears have received an excellent opportunity to continue their offensive, but sustaining this momentum will require continued geopolitical support. The worse the geopolitical situation becomes, the more favorable it is for the dollar.

Overall, the situation in the Middle East is currently better than it was just a few months ago when the parties were engaged in full-scale military confrontation. However, the balance can shift in the opposite direction at any moment. Over the past several weeks, we have witnessed numerous potential escalations in the Middle East, and only the reluctance of both sides to engage in active military operations has prevented a renewed conflict.

In my view, the broader trend remains bullish despite the pair's sharp declines this year. The ceasefire in the Middle East remains fragile, but it is still in place and could be extended for another 60 days. However, the Strait of Hormuz remains under a dual blockade, the nuclear issue remains unresolved, and any perceived progress in negotiations is based largely on statements from Donald Trump. Iran maintains a completely different position. The situation continues to fluctuate between improvement and deterioration. For now, the market retains some confidence that an agreement can still be reached, but that confidence is not unlimited.

The current chart picture is as follows. Bullish Imbalance 18 generated a reaction from price, but Bearish Imbalance 19 ultimately produced a sell signal as well. Therefore, the technical outlook shifted to bearish in a single day. However, it could reverse again in the coming days, as geopolitical developments have recently been changing several times a day.

The economic calendar provided no meaningful information on Monday. Traders will have to wait another day or two before new economic data begins to arrive. There is certainly no shortage of geopolitical headlines, but the market is currently unwilling to react to secondary news. Today, reports emerged of Iranian strikes against Israel, yet GBP/USD is rising, which means the dollar is weakening.

The broader fundamental backdrop remains such that, from a long-term perspective, I continue to expect further weakness in the U.S. dollar. Even the conflict between Iran and the United States changes little in this regard. Geopolitical tensions have temporarily reminded investors of the dollar's safe-haven status over the past two months, but the overall environment for the U.S. currency remains less than favorable.

If the U.S. economy gains additional momentum in 2026, the Federal Reserve resumes its monetary tightening cycle, and the conflict between the United States and Iran evolves into a prolonged confrontation, then the dollar could indeed target the 1.3100–1.3000 level. However, in my opinion, the long-term outlook for the U.S. dollar cannot change solely because of one strong Nonfarm Payrolls report.

News Calendar for the United States and the United Kingdom:

• United States – Existing Home Sales (14:00 UTC).

The economic calendar for June 9 contains only one event, which is unlikely to attract significant market attention. Therefore, the impact of the economic backdrop on market sentiment on Tuesday is expected to be minimal.

GBP/USD Forecast and Trading Recommendations:

For the British pound, the long-term outlook remains bullish; however, the most recent signal generated is a sell signal. Therefore, in the near term, provided that geopolitical developments do not interfere, bears may continue their attack toward the lows of May 18 and March 31. Liquidity could be taken from those swing lows, after which, if geopolitical conditions become more favorable, bulls may once again take control.

At present, it is difficult to imagine that the conflict between Iran and the United States will be resolved in the near future. Therefore, the pound's upward potential remains relatively limited.

Useful links:

My other articles are available in this section

InstaForex course for beginners

Popular Analytics

Open trading account

Important:

The begginers in forex trading need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp market fluctuations due to increased volatility. If you decide to trade during the news release, then always place stop orders to minimize losses.

Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes. For successful trading, you need to have a clear trading plan and stay focues and disciplined. Spontaneous trading decision based on the current market situation is an inherently losing strategy for a scalper or daytrader.

#instaforex #analysis #sebastianseliga

Yet, despite the severity of the situation, sellers of EUR/USD were unable to translate that moment into a sustained move. In my view this price behavior reflects the position of the United States, which did not support this latest phase of the conflict and called on the parties to de-escalate immediately. Washington's conciliatory rhetoric allowed markets to hope that the "April scenario" would not repeat and that the current exchange of strikes would remain a local episode.

Nevertheless, conditions remain extremely tense, and, as pilots say, the situation is "on the verge of stalling," given the bellicose rhetoric and actions of both Israel and Iran.

In brief, yesterday, Israel was hit by an attack: Iranian forces launched 11 ballistic missiles. The situation prompted an immediate response from Donald Trump, who urged Israeli leaders to refrain from a retaliatory strike and said that a final agreement with Tehran was near. Nevertheless, Israel struck Iranian missile launchers and infrastructure sites in central and western Iran. Mehrabad Airport in Tehran was also attacked.

Despite Israel's decision not to heed the US president's request, traders reacted to events with relative restraint. Much of that response reflects further comments by Donald Trump, who said today that Netanyahu will have no choice but to accept a deal with Iran. He added that new Iranian strikes on Israel had not altered his desire to complete US-Iran negotiations and reach an agreement.

In other words, the United States is publicly signaling that the window for a deal remains open. Accordingly, US forces do not plan to rejoin strikes on Iran as they did in April of this year.

By and large, it is currently only Trump's stance that is preventing EUR/USD from collapsing into the 1.14 area. Going forward everything will depend on the actions or inactions of Israel, Iran, and pro-Iranian forces in the region. Houthi fighters in Yemen, backed by Iran, claimed responsibility today for missile strikes on central Israel. The movement also said it would block Israeli maritime traffic in the Red Sea, declaring all vessels connected to Israel legitimate military targets.

Even so, the fate of the negotiation process—and therefore of EUR/USD—now depends not on the Houthis but on the United States, Israel, and Iran. It is worth noting that Iranian officials are issuing contradictory statements. On the one hand, Foreign Ministry spokesman Esmaeil Baghaei said the United States "bears direct responsibility for Israel's violation of the ceasefire" (referring to an attack on territory in Lebanon). He also said incidents over the past 24 hours had only worsened the chaotic situation in the diplomatic process. On the other hand, neither Iranian nor US officials have said they are withdrawing from negotiations. Moreover, according to Baghaei, talks between Iran and the United States continue—the sides are still exchanging messages through Pakistani intermediaries.

Thus, the situation remains in limbo. In my view, the current escalation has not yet run its course despite Donald Trump's calls for de-escalation. For example, Al Jazeera reported that this morning a powerful explosion occurred at the Iranian Foreign Ministry building in Tehran. The nature of that incident is not yet clear, but EUR/USD has already reacted by dipping to the low of 1.15 area.

Overall, persistent tensions in the Middle East increase global inflationary risks, including in the United States. Combined with recent strong US labor data (May nonfarm payrolls showed an increase of 172,000 jobs) and strong ISM indexes, traders are increasingly confident the Federal Reserve will keep the policy rate unchanged at least until the end of the year. Market participants now also assign about a 40% probability of policy tightening in the second half of the year.

Under these circumstances, priority remains with short positions, but selling EUR/USD should be considered only when bears break and close below support at 1.1500 (the lower Bollinger band line on the H4 chart) and sustain levels below it. The main target for a southbound move is 1.1420, which corresponds to the lower Bollinger band line on the W1 timeframe.

Gold entered the new week deep in a correction, hovering near three?month lows around $4,300 per ounce. After amazing US nonfarm payrolls and a sharp hawkish shift in Federal Reserve rhetoric, the precious metal lost more than 3% on Friday and continued lower on Monday, breaking the key psychological and technical support of the 200-day moving average ($4,380.00). Investors are now waiting for the US inflation (CPI) release on Wednesday, which could be a turning point for the market.

Fundamental backdrop: a hawkish shock and escalation

The main catalyst for the crash was the US nonfarm payrolls (NFP) report for May, released on Friday. The figures exceeded the most optimistic expectations.

Key figures: actual payrolls came in at 172,000 (vs. a forecast of 85,000). March and April data were revised up by a combined 93,000 jobs, while the unemployment rate remained at 4.3%.

This data completely changed market expectations. Markets now price in more than a 70% chance of a Fed rate hike before the end of 2026 (up from about 50% before the report).

The US dollar index (USDX) jumped, breaking the psychological 100.00 level for the first time since early April. The 10-year Treasury yield shot above 4.58%, making the dollar very attractive on a yield basis compared with gold, which pays no yield.

Contrary to expectations, renewed fighting in the Middle East over the weekend did not support gold. Israel and Iran exchanged direct missile strikes and Yemeni Houthis hit Israeli territory. This paradoxical reaction is explained by the "oil channel": geopolitical crises push oil prices higher, which raises inflation expectations and in turn prompts central banks toward tighter policy — a major bearish factor for gold.

Short technical analysis

The technical picture for XAU/USD has deteriorated sharply, confirming a medium-term trend change after the break of the key $4,380.00 support (200-day EMA on the daily chart). Gold has broken and settled below this critical medium-term level.

A descending channel has formed on the daily and 4-hour charts, within which price has traded since mid-May. Today it is testing the lower boundary of that channel on the daily chart, near $4,315.00, and the round level of $4,300.00.

The RSI (14) on the daily chart is around 32–33, approaching the oversold zone. This suggests selling momentum is tiring and increases the probability of a short?term consolidation or technical bounce.

However, if the $4,255.00 support (50 EMA on the weekly chart) also fails, that would be another very strong bearish signal.

Key events this week

Conclusion

Gold is under heavy pressure from a combination of hawkish forces. Strong US labor data (NFP) and the subsequent re-pricing of Fed rate expectations (probability of a hike now over 70%) inflicted a severe blow to a non-yielding asset. The dollar strengthened above 100.00, and the 10?year yield rose above 4.50%.

The technical break of the 200-day moving average ($4,380.00) confirmed a trend change, and the market is now searching for a bottom. The $4,255.00–$4,380.00 zone will be the battleground in the coming days. A technical break below $4,250.00 would open the way to 4,100.00 and lower. However, very low RSI readings (around 33) suggest the sell-off may lose momentum.

Economists say that after overcoming short-term obstacles, gold could recover to $5,500.00 by the end of 2026 as central banks continue aggressive reserve accumulation.

Investors should exercise extreme caution. US inflation data on Wednesday will be the defining macro test — any upside surprise will strengthen the dollar and likely send gold below the key $4,255.00 support. Weak inflation could deliver a welcome bounce, which, given current conditions, may still amount to only a corrective rally.

Over four consecutive weeks of losses, funds saw $5.4 billion of net outflows, $1.72 billion of which left just last week. For comparison: that entire amount is comparable to the combined inflows during several months of the market's strong run in early 2025. Thirteen consecutive red days for Bitcoin, seventeen for Ethereum.

BlackRock moved nearly $2.2 billion in Bitcoin and Ethereum to Coinbase Prime over ten days. Fidelity's custody, which holds part of Strategy's reserves, shrank by 15,000 coins in a week. The picture is made up of many pressure points — and they all point in the same direction.

Against this backdrop, Bitcoin broke the psychologically important $60,000 level — a floor that a year ago still seemed a reliable support for any correction. Dropping below $60,000 changes the technical picture dramatically: the next significant support zone is around $53,000 — the average purchase price of Bitcoin by investors that CryptoQuant warned about. Historically, bear markets only ended after testing this level and a "real capitulation" — the moment when the last holders give up and lock in losses. According to CryptoQuant, such capitulation hasn't happened yet: a substantial portion of short- and medium-term holders' PnL has not reached deeply negative territory. That means the market still carries a large overhang of potential sellers.

So, if anyone is counting on a quick correction or pullback in crypto, don't expect big pumps anytime soon.

Trading recommendations

Bitcoin

Buyers are currently targeting a return to $63,600, which would open a direct path to $65,800, and then to $67,700 — breaking that would signal attempts to restore a bull market. On a drop, buyers are expected at $61,100. A return below that area could quickly push BTC toward $59,600, with the furthest target around $58,200.

Ethereum

A clear hold above $1,724 opens a direct path to $1,783. The furthest target is the high near $1,838; overcoming that would indicate strengthening bullish sentiment and renewed buyer interest. On a decline, buyers are expected at $1,645. A return below that area could quickly push ETH toward $1,563, with the furthest target around $1,476.

What's on the chart

• The red lines represent support and resistance levels, where the price is expected to either pause or react sharply.
• The green line shows the 50-day moving average.
• The blue line is the 100-day moving average.
• The lime line is the 200-day moving average.

Price testing or crossing any of these moving averages often either halts movement or injects fresh momentum into the market.

Today, gold fell below the round level of 4,300.

From a technical perspective, the XAU/USD pair maintains a bearish bias, moving within a downward-sloping parallel channel and remaining below the 200-day SMA. An additional signal comes from the negative MACD dynamics, indicating strengthening downward momentum. The Relative Strength Index (RSI), hovering near the 30 level, reflects sustained selling pressure, although its proximity to oversold territory may limit further downside.

The upper resistance boundary is located around the 200-day SMA at approximately $4,439, while the channel resistance line near $4,560, along with the 50-day SMA, represents a more significant barrier as long as the downtrend persists. On the lower side, initial support is located around $4,260; a decisive break below this level could open the way for a deeper correction within the current bearish structure.

Today, on Monday, gold (XAU/USD) continues to move in the established direction, attempting to hold the round level of $4,300, which marks its lowest point since March 23. Escalation of the conflict in the Persian Gulf is supporting higher oil prices, increasing inflation risks and reinforcing expectations of tighter monetary policy from central banks. Against this backdrop, demand for the non-yielding precious metal is declining. An additional confirmation of downward pressure came from Friday's break below an important technical level — the 200-day simple moving average (SMA), strengthening prospects for continued downside momentum that has persisted for nearly two months.The conflict between Israel and Iran has entered a more tense phase, accompanied by mutual strikes across multiple fronts. Israel reported new attacks on military infrastructure in western and central Iran in response to ballistic missile launches targeting Ramat David Airbase on Sunday evening. The geographic scope of the confrontation is expanding: reports of Israeli strikes in southern Lebanon and Iranian activity in northern Iraq are increasing concerns about a broader regional escalation. This undermines an already fragile ceasefire and reduces the likelihood of a near-term resolution of the three-month-long confrontation, while simultaneously supporting the U.S. dollar as a safe-haven asset, which remains stable near two-month highs.Additional support for the dollar came from strong U.S. labor market data released on Friday. The Nonfarm Payrolls (NFP) report reinforced expectations that the Federal Reserve will maintain higher interest rates for a longer period. In May, the U.S. economy added 172,000 jobs, significantly exceeding the forecast of 85,000, while the previous month's figure was revised upward to 179,000. The unemployment rate remained at 4.3%, in line with expectations, despite a slowdown in average hourly earnings growth to 3.4% year-on-year, down from 3.6% in April.

Market reaction was swift: participants are now pricing in more than a 70% probability of further monetary tightening by the Federal Reserve before the end of the year. This factor also supports the U.S. dollar and points to continued downward pressure on gold prices. On Monday, no significant macroeconomic data releases are expected in the United States, so the dynamics of the dollar and the XAU/USD pair will largely depend on geopolitical news flow.

Looking ahead, investor attention will shift to U.S. inflation data: the Consumer Price Index (CPI) and Producer Price Index (PPI), scheduled for release on Wednesday and Thursday respectively. In addition, interest rate decisions from the Bank of Canada and the European Central Bank meeting may further increase volatility in financial markets.

From a technical perspective, XAU/USD maintains a bearish bias, remaining below the 200-day SMA. Immediate support is located at 4,300, with further support at 4,260. A decisive break below this level would open the path to deeper losses.

Resistance is now formed by the 200-day EMA, the round level of 4,400, and the 200-day SMA. Oscillators remain negative, but the Relative Strength Index is approaching oversold territory, indicating a potential minor corrective rebound.

Israel struck southern suburbs of Beirut again. Iran responded with missile strikes on Israeli territory for the first time since April, after which Israel attacked military targets inside Iran — explosions were reported in Tehran, Isfahan, Tabriz, and Karaj. The ceasefire is effectively coming apart. Yet President Trump continues to claim some progress.

Media reports show that Trump called Netanyahu ahead of the strikes, urging him not to derail talks with Tehran, but he was not heeded. After the strikes took place, the US president said they must not wreck the peace process and expressed hope that Israel would refrain from further retaliation, warning of the risk of a multi-year escalation. That is an important signal: Washington is trying to keep the diplomatic track alive but is clearly losing influence over its ally's actions.

Tehran, for its part, called US actions a breach of the truce and placed responsibility for any further escalation on Washington. Iranian parliament speaker Ghalibaf went further, declaring that American military bases in the region are becoming "legitimate targets" because of their support for Israel. That is a direct threat the market cannot ignore — bases in Kuwait, Bahrain, Qatar, and the UAE would be at risk, that is, in immediate proximity to the Strait of Hormuz.

Note that the Lebanon track has become the conduit through which the war is broadening. Iran insists that the ceasefire in Lebanon must be included in any overall deal with the US, while Israel continues operations and does not consider itself bound by any US-Iran understandings. Meanwhile, the Gaza campaign continues, and Egypt is conducting a new round of talks with Hamas — the conflict is unfolding on multiple fronts simultaneously.

With this level of escalation, the threat of a new full shutdown of the strait becomes real again — a scenario oil markets have long tried not to price in. If Iranian threats against US bases materialize and the US responds with strikes on Iranian territory beyond the current scope of the conflict, oil prices could spike sharply, as could demand for the US dollar as a safe haven.

From a technical perspective, EUR/USD buyers need to focus on clearing 1.1540. Only that would set up a test of 1.1560. From there, a move to 1.1580 is possible, though advancing further without support from large players would be difficult. The more distant target would be the 1.1600 high. On the downside, I would expect substantial buying interest only around 1.1505. In case of muted buying activity there, it would be preferable to wait for a decline to a fresh low at 1.1480 or consider long entries at 1.1445.

Regarding the GBP/USD pair, the immediate task of buyers is to overcome the resistance level of 1.3345. That would open the way to 1.3375. Breaking above that level would be challenging, and the next target would be the 1.3410 area. In the event of a decline, bears will try to seize control at 1.3315. If they succeed, a break below that level would deal a severe blow to bulls and push sterling toward 1.3290 with a prospect of extending down to 1.3255.

The test of the 1.3329 price level occurred when the MACD indicator had just started moving lower from the zero line, confirming a valid entry point for selling the pound. As a result, the pair declined by 25 points.

Unfortunately, there are no U.S. economic releases scheduled for the second half of the day, so traders' attention will shift to unscheduled comments from Federal Reserve officials regarding interest rates, as well as statements from Trump concerning the conflict in the Middle East. The market is likely to react with heightened sensitivity to any signals related to monetary policy. Any hints of a more hawkish stance from Federal Reserve officials could trigger selling pressure on the British pound and strengthen the U.S. dollar.

Geopolitical tensions in the Middle East, particularly in the context of relations with Iran, have also remained a significant source of uncertainty weighing on the market in recent weeks. Statements by President Trump, known for their unpredictability, could trigger sharp movements in oil markets and affect overall stability in the currency market. Any escalation of the conflict or intensification of rhetoric could spark renewed investor concerns.

As for the intraday strategy, I will rely primarily on the implementation of Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: I plan to buy the pound today upon reaching the entry point around 1.3349 (the green line on the chart), with a target at 1.3386 (the thicker green line on the chart). Around 1.3386, I plan to exit long positions and open short positions in the opposite direction, targeting a 30–35 point move. Any rise in the pound today is likely to be limited to a modest correction.

Important! Before buying, make sure that the MACD indicator is above the zero line and is just beginning to move higher from it.

Scenario No. 2: I also plan to buy the pound today if there are two consecutive tests of the 1.3319 level while the MACD indicator is in oversold territory. This will limit the pair's downward potential and lead to a reversal to the upside. In this case, a rise toward the opposite levels of 1.3349 and 1.3386 can be expected.

Sell Signal

Scenario No. 1: I plan to sell the pound today after a break below the 1.3319 level (the red line on the chart), which is expected to trigger a rapid decline in the pair. The key target for sellers will be 1.3278, where I plan to exit short positions and immediately open long positions in the opposite direction, targeting a 20–25 point move. Selling pressure on the pound may return at any moment today.

Important! Before selling, make sure that the MACD indicator is below the zero line and is just beginning to move lower from it.

Scenario No. 2: I also plan to sell the pound today if there are two consecutive tests of the 1.3349 level while the MACD indicator is in overbought territory. This will limit the pair's upward potential and lead to a reversal to the downside. In this case, a decline toward the opposite levels of 1.3319 and 1.3278 can be expected.

Chart Notes:

• Thin green line – the entry price at which the trading instrument can be bought;
• Thick green line – the estimated level where Take Profit orders may be placed or profits may be manually secured, as further growth above this level is unlikely;
• Thin red line – the entry price at which the trading instrument can be sold;
• Thick red line – the estimated level where Take Profit orders may be placed or profits may be manually secured, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to take overbought and oversold zones into account.

Important. Beginner Forex traders should exercise extreme caution when making market entry decisions. It is best to stay out of the market ahead of major fundamental reports to avoid exposure to sharp price fluctuations. If you choose to trade during news releases, always use stop-loss orders to minimize potential losses. Without stop-loss orders, you can lose your entire deposit very quickly, especially if you do not apply proper money management and trade large volumes.

Remember that successful trading requires a clear trading plan, such as the one presented above. Making spontaneous trading decisions based solely on the current market situation is inherently a losing strategy for an intraday trader.

The test of the 1.1521 price level occurred when the MACD indicator had just started moving below the zero line, confirming a valid entry point for selling the euro. As a result, the pair declined by 20 points.

The sharp 3.8% decline in German industrial orders in April created problems for the euro. Particularly concerning was the drop in new orders, which serve as a leading indicator of future manufacturing activity. A 3.8% decrease compared with the previous month suggests that German manufacturers are facing increasing difficulties in securing new contracts. This may be attributed to several factors, including persistent inflation, rising energy costs, and a global slowdown in demand, particularly from key trading partners. The decline in the euro was a direct consequence of this disappointing data.

Given the absence of any U.S. economic releases during the second half of the day, market participants will focus on any unexpected comments from Federal Reserve officials regarding interest rates. Remarks from voting FOMC members concerning monetary policy will be particularly important. Any hints of further policy tightening could trigger significant price movements and strengthen the U.S. dollar against the euro. Investors will closely monitor any signals capable of altering expectations regarding the regulator's future actions.

As for the intraday strategy, I will rely primarily on the implementation of Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: Today, euro purchases may be considered if the price reaches the 1.1533 level (the green line on the chart), with a target at 1.1570. At 1.1570, I plan to exit long positions and open short positions in the opposite direction, targeting a 30–35 point move from the entry point. However, expecting a strong rise in the euro today may be difficult.

Important! Before buying, make sure that the MACD indicator is above the zero line and is just beginning to move higher from it.

Scenario No. 2: I also plan to buy the euro today if there are two consecutive tests of the 1.1510 level while the MACD indicator is in oversold territory. This will limit the pair's downward potential and lead to a reversal to the upside. In this case, a rise toward the opposite levels of 1.1533 and 1.1570 can be expected.

Sell Signal

Scenario No. 1: I plan to sell the euro after the price reaches the 1.1510 level (the red line on the chart). The target will be 1.1480, where I intend to exit short positions and immediately open long positions in the opposite direction, targeting a 20–25 point move. Selling pressure on the pair may return at any moment today.

Important! Before selling, make sure that the MACD indicator is below the zero line and is just beginning to move lower from it.

Scenario No. 2: I also plan to sell the euro today if there are two consecutive tests of the 1.1533 level while the MACD indicator is in overbought territory. This will limit the pair's upward potential and lead to a reversal to the downside. In this case, a decline toward the opposite levels of 1.1510 and 1.1480 can be expected.

Chart Notes:

• Thin green line – the entry price at which the trading instrument can be bought;
• Thick green line – the estimated level where Take Profit orders may be placed or profits may be manually secured, as further growth above this level is unlikely;
• Thin red line – the entry price at which the trading instrument can be sold;
• Thick red line – the estimated level where Take Profit orders may be placed or profits may be manually secured, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to take overbought and oversold zones into account.

Important. Beginner Forex traders should exercise extreme caution when making market entry decisions. It is best to stay out of the market ahead of major fundamental reports to avoid exposure to sharp price fluctuations. If you choose to trade during news releases, always use stop-loss orders to minimize potential losses. Without stop-loss orders, you can lose your entire deposit very quickly, especially if you do not apply proper money management and trade large volumes.

Remember that successful trading requires a clear trading plan, such as the one presented above. Making spontaneous trading decisions based solely on the current market situation is inherently a losing strategy for an intraday trader.

The sharp decline in German industrial orders put pressure on the euro during the first half of the day, as it provided further evidence of a slowdown in the European economy, which had already been showing signs of weakness. A contraction in industrial production, especially in a key economy such as Germany, inevitably affects the overall performance of the eurozone economy, influencing both investor and consumer sentiment.

The negative dynamics in industrial orders point to several issues. First, they may indicate a decline in the competitiveness of German products in global markets due to Trump's tariffs. Second, they may reflect a broader slowdown in the global economy caused by high energy prices, which is reducing demand for industrial goods. Third, domestic factors cannot be ruled out.

Unfortunately, there are no U.S. economic releases scheduled for the second half of the day, so traders' attention will shift entirely to Trump and his statements regarding the conflict between Iran and the Middle East. The absence of U.S. macroeconomic data creates a vacuum that is likely to be filled by speculation and rumors. This could lead to increased volatility in both currency and equity markets.

Any statement by Donald Trump regarding his view of the situation in the Middle East and potential actions toward Iran will add another layer of uncertainty. Tensions in this strategically important region remain a risk factor for the global economy, and any new comments or announcements could either heighten or ease market concerns.

If strong economic data is released, I will rely on the Momentum strategy. If the market shows no reaction to the data, I will continue using the Mean Reversion strategy.

Momentum Strategy (Breakout Trading) for the Second Half of the Day:

For EUR/USD

• A breakout above 1.1535 may lead to a rise in the euro toward 1.1560 and 1.1579;
• A breakout below 1.1505 may lead to a decline in the euro toward 1.1480 and 1.1448;

For GBP/USD

• A breakout above 1.3343 may lead to a rise in the pound toward 1.3375 and 1.3407;
• A breakout below 1.3309 may lead to a decline in the pound toward 1.3285 and 1.3256;

For USD/JPY

• A breakout above 160.24 may lead to a rise in the dollar toward 160.43 and 160.67;
• A breakout below 160.02 may trigger further selling pressure on the dollar toward 159.83 and 159.60;

Mean Reversion Strategy (Fade Trade) for the Second Half of the Day:

For EUR/USD

• I will look for short positions after a false breakout above 1.1547 followed by a return below this level;
• I will look for long positions after a false breakout below 1.1494 followed by a return to this level;

For GBP/USD

• I will look for short positions after a false breakout above 1.3352 followed by a return below this level;
• I will look for long positions after a false breakout below 1.3297 followed by a return to this level;

For AUD/USD

• I will look for short positions after a false breakout above 0.7070 followed by a return below this level;
• I will look for long positions after a false breakout below 0.7035 followed by a return to this level;

For USD/CAD

• I will look for short positions after a false breakout above 1.3957 followed by a return below this level;
• I will look for long positions after a false breakout below 1.3932 followed by a return to this level.

The wave structure on the hourly chart remains straightforward at this point. The latest completed upward wave broke above the previous peak, while the latest downward wave broke below the previous low. Therefore, the trend has once again shifted to bearish. Bulls may launch a new offensive only if Iran and the United States sign an interim agreement, stop violating the ceasefire terms, and the Strait of Hormuz remains open. Without these conditions, further appreciation of the euro will be extremely difficult.

On Friday, traders received the data they had been waiting for since the beginning of the week. Throughout the week, a considerable amount of economic information was released in the United States, and nearly all reports showed positive dynamics. However, the market reacted rather cautiously, preferring to wait for the most important releases. On Friday, it became known that the U.S. unemployment rate remained unchanged in May, while Nonfarm Payrolls exceeded traders' expectations by 87,000. In addition, the April reading was revised upward. As a result, a single report was enough for bears to become active after several weeks of inactivity and begin selling aggressively. It should be recalled that the dollar currently has one undeniable advantage — geopolitics. No significant news emerged from the Middle East over the weekend. The opposing sides continued to exchange attacks as usual, while making no progress toward a ceasefire agreement. Since the chances of reaching a peace settlement remain extremely low, the market is unwilling to move too far away from the dollar. Strong U.S. economic data is also adding confidence to the bears.

On the 4-hour chart, the pair rebounded from the 38.2% Fibonacci retracement level at 1.1667 and resumed its decline within the downward trend channel. Consolidation below the 23.6% Fibonacci level at 1.1569 suggests a continuation of the decline toward the next retracement level of 0.0% at 1.1411. Bulls are unlikely to regain control before a breakout above the channel. No emerging divergences are currently observed on any indicator.

Commitments of Traders (COT) Report:

During the latest reporting week, professional traders opened 12,387 Long positions and closed 7,053 Short positions. Over seven weeks in February and March, the bulls' overall advantage disappeared due to the war in Iran, while over the past ten weeks the situation has stabilized amid the suspension of hostilities in the Middle East. The total number of Long positions held by non-commercial traders currently stands at 235,000, while Short positions amount to 186,000. The gap is once again widening in favor of the bulls.

Overall, large market participants continue to maintain a strong long-term interest in the euro. Naturally, various global developments, which have been abundant in recent years, continue to influence investor sentiment. At present, the market's attention remains focused on the Middle East, where the conflict has merely been paused rather than resolved. Therefore, in the near term, the trajectories of the euro and the dollar will depend less on Federal Reserve or European Central Bank monetary policy and economic data, and more on developments in Iran.

News Calendar for the United States and the Eurozone:

The economic calendar for June 8 contains no significant events. Therefore, the impact of the economic backdrop on market sentiment on Monday is expected to be absent.

EUR/USD Forecast and Trading Tips:

Short positions may be considered today if the pair closes below 1.1514 on the hourly chart, with a target at 1.1409. Long positions may be considered on a rebound from 1.1514, with targets at 1.1578 and 1.1630.

Fibonacci grids are plotted from 1.1409 to 1.1850 on the hourly chart and from 1.2081 to 1.1411 on the 4-hour chart.

The wave structure remains bearish, as bulls lack positive geopolitical developments to launch a sustained advance. The latest completed upward wave failed to break the previous peak, while the latest downward wave broke below the previous low. Geopolitical developments remain highly uncertain at this stage, leaving neither bulls nor bears with a clear advantage. The bearish trend can only be considered complete after a break above the June 5 high.

The news background was entirely on the side of the bears on Friday, which led to the sharp decline. However, a new week has begun, and traders will need new reasons to open positions. The first important event of the week is scheduled for Wednesday. On that day, the U.S. inflation report for May will be released, and it is likely to shape expectations regarding the Federal Reserve's policy outlook ahead of next week's meeting. The Consumer Price Index may show acceleration for the third consecutive month. Analysts expect it to rise to 4.2%. Thus, inflation could exceed the Federal Reserve's target by more than two times in May. In my view, this would be sufficient for the market to begin pricing in monetary policy tightening by the Fed before the end of 2026. A rate hike in June remains unlikely, but the new FOMC President, Kevin Warsh, may indicate that the regulator is prepared to take such a step at its next meeting. If inflation slows, the Fed is likely to maintain its wait-and-see approach, reducing bears' confidence. Therefore, the higher the inflation reading in the United States, the more supportive it will be for the dollar.

On the 4-hour chart, GBP/USD rebounded from the 1.3482–1.3514 resistance level and declined toward the 23.6% Fibonacci retracement level at 1.3327. Consolidation below this level would allow bears to continue their advance toward the next Fibonacci level at 1.3159 (0.0%). A rebound from the 1.3327 level would favor the pound and a moderate recovery toward 1.3429. No emerging divergences are currently observed on any indicator.

Commitments of Traders (COT) Report:

Sentiment among the Non-commercial group became less bearish during the latest reporting week. The number of long positions held by speculators decreased by 4,291, while the number of short positions fell by 13,471. The gap between long and short positions now stands at approximately 53,000 versus 110,000. Bears have dominated in recent months, which comes as no surprise given the geopolitical situation in the Middle East and the political crisis in the United Kingdom. The bears' advantage currently exceeds two to one.

I still do not believe in a sustained bearish trend for the pound. However, in the near term, market direction will depend not on economic indicators, Trump's trade policy, or central bank monetary policy, but rather on the duration, scale, and consequences of the war in the Middle East. In recent weeks, the market has adjusted to expectations of a prolonged conflict, but recent developments suggest that a ceasefire may still be reached, although the process is unlikely to be easy or quick.

News Calendar for the United States and the United Kingdom:

The economic calendar for June 8 contains no notable events. Therefore, the economic background is unlikely to influence market sentiment on Monday.

GBP/USD Forecast and Trading Tips:

Short positions were possible after the rebound from the 1.3454–1.3466 resistance level on the hourly chart, with targets at 1.3408 and 1.3349–1.3355. Both targets have been reached, and these positions may remain open with a target at 1.3277. Long positions may be considered today if the pair consolidates above the 1.3349–1.3355 level, targeting 1.3408.

Fibonacci grids are drawn from 1.3158–1.3655 on the hourly chart and from 1.3866–1.3158 on the 4-hour chart.