Market narrative
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As we came into the year gold was all the rage. Bitcoin seemed to be an afterthought but with the metal pushing into the $4500 level before the end of last year you didn't have to look far for forecasts to $6k.
Forex
MUFG believes gold remains well supported despite higher US Treasury yields, arguing that persistent geopolitical tensions are generating enough safe-haven demand to offset the headwinds from a more hawkish interest-rate outlook. The price of Gold in US dollars (XAU/USD) traded around $4,100 on Friday after extending its rebound from.
Rabobank expects renewed pressure on Pound exchange rates as concerns over Prime Minister Andy Burnham's spending plans unsettle the gilt market. The British Pound concluded this trading week facing a difficult combination of political uncertainty, elevated UK bond yields and doubts over how the new government intends to fund its policy.
The bullish breakout flagged in last week's outlook played out exactly as anticipated, sending USD/JPY to fresh multi-decade highs. Whether the rally can extend further will likely be determined by a packed week headlined by policy decisions from the Federal Reserve and Bank of Japan, alongside key inflation, growth and labour market data from both economies.
The CHF/JPY is currently in consolidation, with traders seeking for fresh triggers ahead of the BoJ's policy decision on 31 July.
Stronger UK retail sales and improving business activity support the pound, but GBP/EUR must break 1.1760 to revive July's rally. The Pound to Euro exchange rate recovered on Friday after suffering three consecutive daily declines earlier in the week.
It was not an easy week for the euro. Now, EUR/USD has accumulated a decline of more than 0.4% over the last 2 trading sessio.
ING's forecast for EUR/USD to retreat towards 1.1380 has already been realised, with the pair now testing its lowest levels of July as higher energy prices support the US Dollar. The Euro-to-Dollar exchange rate traded close to 1.1371 late on Friday, extending its retreat from the mid-July peak near 1.1470.
Gold is testing key support after its recent breakout, with a sustained move above $4,203 potentially confirming a bullish reversal toward the 200-day moving average.
EUR/JPY Price Forecast: Cross consolidates under 187.00, bulls target 188.00
United States CFTC Gold NC Net Positions declined to $183.9K from previous $186.7K
NZD/USD Price Forecast: Tests 0.5800 as bullish momentum fades
Looks like we don't need to worry about that Fort Knox Gold audit anymore
EUR/USD has extended its decline after forming a notable double-top pattern, with the ECB's latest rate decision strengthening the bears.
Gold gains despite firm US Dollar
The FOMC rate decision in June is what finally helped USD bulls to take a big step forward and from the weekly chart, that move is still quite evident although it started to stall shortly after running into the Fibonacci level at 101.80.
Silver Price Forecast: XAG/USD consolidates as bulls struggle to clear the 21-day SMA
Gold and silver are moving higher as traders focus on falling Treasury yields.
The American currency is losing ground as demand for safe-haven assets declines.
Gold recovers as peace talk hopes cool oil and Treasury yields, but Trump's Iran decision keeps the inflation trade alive.
