Looking at this chart, and looking at the history of Jerome Powell, I can almost guarantee that he will probably make things worse, not better. 

• The gold spot market rallied a bit during the trading session on Thursday, to reach above the $1760 level. The market is likely to continue seeing a lot of noise.
• Gold markets are waiting to see what happens on Friday morning, as Jerome Powell has a speech at the Jackson Hole Symposium.
• Traders are trying to figure out whether the Federal Reserve is going to reiterate its hawkish attitude, or if it is going to have to pivot. After all, there is somewhat mixed economic news out there, but at the end of the day, inflation is still a big deal.

The 50-Day EMA sits above and is offering a significant amount of resistance, so I think a lot of traders will be paying attention to that technical indicator. Above there, we have the $1800 level, which is where we had pulled back from previously, with the 200-Day EMA sitting above there. All of that could cause a significant amount of resistance, so do not be surprised at all to see a huge fight if we try to rally.

Traders Waiting for Jerome Powell’s Speech

Underneath, the $1720 level has offered short-term support, and I think a lot of people will be looking at that number with great interest. If we were to break it down below it, it’s possible that we could go down to the $1680 level. Anything below there opens a significant amount of potential selling pressure, and it’s possible that we could drop all the way down to the $1500 level. It’s going to be difficult to trade this market in the short term, because you are going to have to pay close attention to the bond markets and interest rates, or perhaps more specifically put, pay attention to how traders interpret whatever it is Jerome Powell says.

Looking at this chart, and looking at the history of Jerome Powell, I can almost guarantee that he will probably make things worse, not better. Clarity is not exactly his forte, so I anticipate that we have sloppy trading ahead of us. However, I do think that the support area underneath should be rather significant, so it’s going to take a lot to send the market through that floor. Another real possibility is that we are simply going to grind in this overall consolidating pattern.

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I think you need to look at this through the prism of buying dips as an investment.

• The BTC/USD currency pair rallied ever so slightly on Friday as we continue to grind back and forth.
• That being said there is a little bit of a “buy on the dip” mentality at the moment, but not necessarily anything that I would consider to be explosive or momentous.
• I think at this point in time it’s likely that we could get a little bit of a pullback, but I think also that there is a certain amount of accumulation going on which will probably be well for the long term.

Technical Analysis

The 50-day EMA sits just below the $22,000 level and could offer a bit of dynamic support. If we were to break it down below there, then it’s obvious that it would be a negative turn of events. Breaking down below all of that opens up the possibility of a move down to the $20,000 level. The $20,000 level is a large, round, psychologically significant figure that a lot of people will pay close attention to and breaking down below that could really open up the floodgates.

The alternate scenario of course is that we break above the $25,000 level, perhaps reaching the $28,000 level. The $28,000 level extends to the $32,000 level and should be a massive resistance barrier. If we can clear all of that, then it would obviously be a change of trend, and at that point, I think that Bitcoin could go much higher. If we were to see Bitcoin break above there, we would probably start to see some of the smaller markets react and rally as well.

A lot of this will come down to the US dollar, which is starting to try to strengthen itself again. A lot of people are banking on the Federal Reserve loosening monetary policy, and therefore boosting risk appetite. If the Federal Reserve starts to get tight again, that could have people running away from Bitcoin as well. Either way, I think you need to look at this through the prism of buying dips as an investment, but if you are a shorter-term trader, you should probably continue to go back and forth and try to build up a sizable account through a range bound system that is focused more on a lower timeframe going forward.

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The pair will likely continue falling as sellers target the next psychological level of 1.1800.

Bearish View

• Sell the GBP/USD pair and set a take-profit at 1.1800.
• Add a stop-loss at 1.1975.
• Timeline: 1-2 days.

Bullish View

• Set a buy-stop at 1.1935 and a take-profit at 1.2000.
• Add a stop-loss at 1.1850.

The GBP/USD sell-off gained steam during the American and Asian sessions as the US dollar strength continued. The pair dropped to a low of 1.1880, which was the lowest point since 2020. It has crashed by about 12% in 2022.

UK Economic Outlook

The GBP/USD pair declined as the outlook for the UK economy worsened. On Monday, many unions representing rail workers announced that they will strike soon. This will be the biggest strike in over 25 years and will affect train passengers across the UK. The workers are protesting poor wages amid soaring inflation.

The UK government has asked unions to go back to the negotiating table and reach a deal. At the same time, groups representing rail companies urged their workers not to strike. Other unions, especially those representing postal workers, have warned of a major strike.

These strikes will affect the country’s economy at a difficult time when inflation has surged to the highest level in over four decades. House prices have surged while retail sales have all declined. Consumer confidence has slumped to the lowest level in over a decade.

The GBP/USD pair also declined as the US dollar strength continued broadly. The closely watched US dollar index rose to $106 as the currency rose against developed and emerging market currencies. The index rose as investors reacted to the strong labor market data.

On Friday, data published by the Bureau of Labor Statistics (BLS) showed that the economy added over 372k jobs in June while the unemployment rate remained at 3.7%. While the participation rate is still low, analysts expect that the Federal Reserve will continue tightening policies in the coming months.

The next key catalyst for the GBP/USD pair will be the upcoming US consumer inflation data. Analysts expect that inflation jumped to 8.8% in June.

GBP/USD Forecast

The four-hour chart shows that the GBP/USD pair has been in a strong bearish trend in the past few months. Recently, it formed an inverted cup and handle pattern that is shown in black. As it dropped in the overnight session, the pair managed to move below the lower side of the cup. It has also moved below the 25-day and 50-day moving averages.

Therefore, the pair will likely continue falling as sellers target the next psychological level of 1.1800. A move above the resistance point at 1.1950 will invalidate the bearish view.

Yes, it’s been a nice rally as of late, but the reality is that it is but a blip on the radar of what we had seen for so long.

The British pound continued to grind to the upside on Monday, although it should be noted that it was a very quiet session as Americans were away for Memorial Day. Ultimately, we also have the 50-day EMA above that should offer resistance as well. Regardless, even if we rally from here, I think that it is going to be more of a grind higher and it will probably set up for a longer-term selling opportunity.

The 1.30 level above is massive resistance just waiting to happen because it is “market memory” that comes into play here. It had been previous support, so I would certainly think that the sellers would be interested in getting involved again. The 1.30 level is also a large, round, psychologically significant figure, so in and of itself it could cause a certain amount of noise.

Ultimately, this is a market that has been in a downtrend for quite some time, and I think that any breakdown should be looked at as a potential selling opportunity. If we break down below the 1.25 on a daily close, that will more than likely continue to put sellers back into the marketplace. The 1.22 level underneath could be the target, perhaps even the 1.20 level after that. The market has been in a downtrend for quite a few different reasons, not the least of which would be risk aversion. There are still plenty of reasons to think that fear will be out there, which would have money drive into the US dollar.

Part of what we have been seeing lately has been yields dropping in America, but we have sold off so drastically that a bit of a bounce had to happen. Ultimately, this is a market that will eventually start to look at people buying bonds as driving up demand for the greenback as well. In fact, it’s not till we break above the 1.31 level that I would consider buying the British pound, and until the Bank of England changes its overall outlook on interest rate hikes. Yes, it’s been a nice rally as of late, but the reality is that it is but a blip on the radar of what we had seen for so long. I’m looking for signs of exhaustion to start selling again.

I believe at this point you are more likely than not going to see choppy and destructive behavior more than anything else.

The FTSE 100 rallied a bit on Tuesday to reach the 7500 level, but it is worth noting that we have seen quite a bit of compression as of late and volatility. This is a chart that is getting ready to see a potentially big move, but we need to define which direction we are heading in, and I believe we will see that in the next couple of daily candlesticks.

If you squint, you can make out an inverse head and shoulders pattern. If we do break out above the neckline, the theoretical target would be 7800. This would be a “risk-on” type of move, but I do not think that’s as likely to happen. Ultimately, you should also pay attention to the 50-day EMA underneath, because it has offered nice dynamic support. Underneath there, we have the 200-day EMA rising, so it all comes together for support.

Alternately, you could make an argument for a down-trending line that we are paying close attention to, so we could drop down to the 7400 level, possibly even the 7200 low water lead. The market has been extraordinarily volatile, and that typically does not bode well for buyers. That being said, it’s worth noting that every time we have fallen, there has been a significant push to the upside in an attempt to recover, so I think we will continue to see a lot of compression and we are due for some type of expansion move.

The candlestick for the trading session on Tuesday is rather bullish-looking, but it also is worth noting that there’s a lot of noise just above. Because of this, I think we will continue to see more confusion than anything else. This is a market that had been in a massive uptrend for a while, but we are starting to see a lot of confusion, so at this point, it’s likely going to be a situation where you need to be cautious with your position size, and of course risk management. I believe at this point you are more likely than not going to see choppy and destructive behavior more than anything else. However, the market will continue to build up pressure in order to make a decision.

The ₹77 levels have been important in the past, and I think that is where we are heading.

The US dollar rallied a bit during the trading session on Thursday again to break above the ₹76.50 level. This is an area that previously has been a little bit of resistance, but in the bigger scheme of things is minor at best. When you look at the chart, we have been in an uptrend for quite some time, pulled back to the ₹75.50 level, and then shot higher again. Remember, this is a pair that typically grinds in one direction or the other and does tend to trend for very long periods.

The ₹77 levels have been important in the past, and I think that is where we are heading. This makes a lot of sense considering that the US dollar is strengthening against almost everything at the moment, and of course, the Indian rupee represents an emerging market economy. Right now, there are a lot of concerns about global growth slowing down, and the strengthening US dollar acts as a bit of a feedback loop because most emerging market debt is denominated in US dollars so therefore it creates quite a bit of problem for countries like India.

If we do see a continued strengthening of the US dollar against most other currencies, there is no reason to think that it cannot break above the ₹77 level rather handily. Keep in mind that the central bank in India is a little bit more active in setting a range, but right now I do not think they have a major issue with the rupee falling, mainly because it could be too expensive to fight it.

There are energy concerns, but it appears that India is finding some type of backdoor situation with the Russians, so that may not have the effect on India that it very well could have on other places like Europe. Nonetheless, if we start to see a lot of economic pain around the world, there is almost no chance India escapes it. Furthermore, investors tend to repatriate money when things get tough. Most of the money is going to come out of places like India and back into other places like Europe or the United States. The US dollar is considered to be a safe currency, and that might be the only thing people care about at this point.

Expect choppy behavior, but if you are a longer-term trader, this might be a place to start building a position.

Solana has done very little during the trading session on Thursday, as has been the case for the last couple of weeks. We are hanging about the $100 level, an area that would attract a lot of attention. As long as we can find some type of has no real catalyst to get moving, I see this changing anytime soon.

Solana will more than likely need to see some type of external influence to get overly bullish. At this point, I think it is obvious that Solana is going to be waiting for Bitcoin or Ethereum to make up its mind before it will make a move. Solana is playing second fiddle to these markets, despite the fact that it had burst onto the scene so aggressively just a couple of years ago. Nonetheless, the 50 Day EMA above offers a little bit of technical resistance, just as the 200 Day EMA well. With that in mind, I think this is a situation where the market will probably find quite a bit of selling pressure above, so I think it is going anywhere anytime soon. This chart represents what is going on in the entire crypto market right now, nothing.

Whether or not it is consolidation or accumulation remains to be seen, but at this point, it looks like you have got a clear range-bound market that you can deal with, but we are essentially at “fair value.” The bottom of the range is at the $80 level, while the top is at the $120 area. We are right in the middle of it, so unless you have a longer-term outlook on the market, there is absolutely no reason to get involved. While Solana does have a great longer-term outlook to it, I do not necessarily think this is going to be anything more than a potential investment. That is probably true with most cryptocurrencies right now, at least until money starts flowing back into the markets. As a general thought, it appears that there is no real desire to get involved in the crypto markets by most traders, so therefore I think you probably should listen unless you are looking to buy it “on the cheap” and hold onto it until the cycle starts to rally everything out there. Expect choppy behavior, but if you are a longer-term trader, this might be a place to start building a position.

The European Union is a mess at the moment, so it is difficult to imagine that this index is going to rise very rapidly.

The Euro Stoxx 50 went sideways over the last three trading sessions as we hang about the €3750 region. This is an area that previously has been both support and resistance, so is not a huge surprise to see that these stocks are hanging around this vicinity. At this point, traders are trying to determine whether or not they are going to go short or try to pick up a bit of value.

Notice that the candlestick from the Thursday session the last week was an inverted hammer, sitting right on top of the €3700 level. This is an area that I will be paying close attention to because it could kick off massive selling in not only the Euro Stoxx 50 Index, but most European indices in general. After all, stocks do tend to move in the same general direction in the region, so this index is a great indicator of where we may go in other markets.

Keep in mind that the Euro Stoxx 50 represents nine different European countries, so this gives you a good overall indicator of the EU. Obviously, there has been a significant problem in the European Union as of late due to the lack of economic growth, and there are a lot of concerns when it comes to the energy policy of the European Union, as the continent is essentially held hostage to Russian energy, so it needs to sort that situation out before it can step away from an impending recession.

It is worth noting that the Germans have recently had to bring down their estimates of GDP, and that shows just how dire the situation could be. Furthermore, inflation is going to be a major issue in a region that has a major problem for its central bank, as they are struggling with the idea of trying to tighten monetary policy to fight inflation. In other words, the European Union is a mess at the moment, so it is difficult to imagine that this index is going to rise very rapidly. Note that the 50-day EMA sits just below the €3900 level and is racing lower. I think that offers dynamic resistance, and I would be a seller of signs of exhaustion after short-term rallies. I would also short this market below the €3700 level. As things stand right now, I do not have any interest in trying to buy this market.

I believe this is a market that is going to be easier to short than to go long in.

The Euro has rallied a bit during the trading session on Thursday but gave back the gains to form an inverted hammer. While this market continues to drop, the reality is that the strength of the candlesticks continues to shrink as well. This suggests that perhaps we could see this market try to make a turnaround rather soon, but we need to pay close attention to the 1.08 level as it is a major floor in the market.

The 1.08 level caused the most recent bounce, so it does make a certain amount of sense that there will probably be support there again. Breaking below that level would attract a lot of attention, and perhaps even more selling but it is worth noting that it is at the top of a major consolidation area on longer-term charts. The market breaking below the 1.08 level would more likely than not offer choppy downward action. I do not think that it will be easy to bust through all of that noise underneath.

On the upside, if we were to break above the highs of both Wednesday and Thursday, that would be the violation of a couple of inverted hammers, and that would of course be a very bullish sign. In that scenario, the market would initially target the 1.10 level, and then perhaps the 1.11 level after that. The 50 Day EMA is sitting at the 1.11 level as well, so that adds even more credence to the idea of resistance. In fact, that is the beginning of a “zone of resistance” that extends to the 1.12 level. In general, this is a market that needs to break through all of that in order to go higher for the longer term.

As things stand right now, I believe this is a market that is going to be easier to short than to go long in, perhaps using rallies to find a bit of value in the US dollar, as the market continues to favor the greenback. Furthermore, the interest rate differential continues to favor the United States, and I think that will be a major driver here. This is a market that has been in a downtrend for ages, and even if it were to change directions for the longer term, we have a lot of work to do before you can be a buyer.