As global markets digest key developments in monetary policy and geopolitical tensions, volatility remains a persistent feature across major currency pairs and gold. Shifting sentiment around inflation, interest rate paths, and global trade dynamics continues to reshape expectations. Below is an in-depth analysis and forecast for EUR/USD, GBP/USD, USD/JPY, NZD/USD, and Gold (XAU/USD), incorporating recent price action, fundamental events, and technical positioning.
🇪🇺/🇺🇸 EUR/USD Outlook – Euro vs U.S. Dollar
Euro Under Pressure Despite Temporary Strength
Market Drivers:
- EU Trade Relief: Temporary postponement of U.S. tariffs on EU goods offered short-term support to the euro.
- Weak EU Fundamentals: The EC revised 2024 growth forecasts to 0.9%. German consumer confidence remains depressed.
- Monetary Policy Outlook: ECB is expected to cut rates in June, reinforcing a dovish bias.
- U.S. Influence: Durable goods and consumer confidence data will impact USD direction. Hawkish/dovish commentary from Fed speakers (e.g., Kashkari) may trigger volatility.
Current Price Behavior:
- The euro rose to a one-month high at 1.14, testing resistance before facing renewed selling pressure.
- Despite the recent uptick, sellers regained control around 1.1413.
- Market bias remains neutral to bearish, with correction potential if U.S. data strengthens the dollar.
Key Levels:
- Support: 1.1376, 1.1315, 1.1269, 1.1220
- Resistance: 1.1413, 1.1456
Forecast:
Expect range-bound trading with a tilt to the downside unless U.S. data disappoints significantly. Sustained trading below 1.1376 could open the door to 1.1315. A break above 1.1413 would challenge 1.1456, though a euro rally seems limited without stronger EU fundamentals.
🇬🇧/🇺🇸 GBP/USD Outlook – British Pound vs U.S. Dollar
Bullish Momentum Capped by Economic Risks
Market Drivers:
- BoE Policy Outlook: Rate cuts are expected, though more gradual than initially forecast. Markets price a terminal rate near 3.7%.
- U.K. Data: Recent economic prints remain mixed, offering limited support for further GBP gains.
- U.S. Influence: Durable goods and consumer confidence, alongside Fed speeches, will heavily impact intraday direction.
Current Price Behavior:
- The pound tested 1.3563, near recent highs. Momentum has slowed, and hesitation near 1.3542 support hints at potential retracement.
- Bias is still upward, but technical exhaustion and soft UK data suggest caution for further gains.
Key Levels:
- Support: 1.3542, 1.3474, 1.3434, 1.3382
- Resistance: 1.3593, 1.3713
Forecast:
While the broader trend favors further gains, watch for retracements toward 1.3474 if buyers fail to hold 1.3542. Only a clean break above 1.3593 would support a move toward 1.3713. Sentiment hinges on both UK economic resilience and U.S. macro data.
🇺🇸/🇯🇵 USD/JPY Outlook – U.S. Dollar vs Japanese Yen
Yen Strength Challenged by U.S. Data Volatility
Market Drivers:
- U.S. Fiscal Concerns: Dollar softness is fueled by fears over the U.S. budget deficit and Trump’s aggressive fiscal plans.
- BoJ Outlook: Governor Ueda maintains a hawkish stance, supporting yen strength amid global uncertainty.
- Safe-Haven Demand: Market risk aversion continues to support the yen, especially as geopolitical and fiscal tensions rise.
Current Price Behavior:
- USD/JPY declined to 142.19, where buyers emerged.
- Despite a temporary bounce, the price is testing resistance near 143.07, with potential to move toward 144.10 if broken.
Key Levels:
- Support: 142.19, 141.52
- Resistance: 143.07, 144.10, 144.80
Forecast:
The medium-term outlook remains bearish due to BoJ tightening and rising haven demand. A break below 142.19 would reinforce downside toward 141.50. However, a confirmed move above 144.10 would signal the resumption of a bullish correction.
🇳🇿 /🇺🇸 NZD/USD Outlook – New Zealand Dollar vs U.S. Dollar
Kiwi Faces Pressure Ahead of Expected RBNZ Cut
Market Drivers:
- RBNZ Outlook: A 25 bps cut is widely anticipated, with additional cuts likely this year. Forecasts will be key for longer-term direction.
- Domestic Conditions: Despite higher-than-expected Q1 inflation (2.5%), weak growth and global uncertainty dominate sentiment.
- External Factors: U.S. dollar movement and risk sentiment (affected by Trump’s trade policy) will continue influencing the kiwi.
Current Price Behavior:
- NZD/USD dropped sharply to 0.5950, down nearly 0.8% on the day.
- The pair remains under heavy pressure after peaking near 0.6031.
Key Levels:
- Support: 0.5920, 0.5880
- Resistance: 0.5990, 0.6030
Forecast:
Expect continued downside pressure unless the RBNZ surprises with a hawkish outlook. A bounce toward 0.5990 could occur on USD weakness, but the pair may test 0.5920 if RBNZ confirms a dovish path.
🌕 Gold (XAU/USD) Outlook – Gold vs U.S. Dollar
Capped by Fed Uncertainty, Awaiting Catalyst
Market Drivers:
- U.S. Macroeconomic Data: Durable goods and consumer sentiment could sway expectations for Fed policy and drive demand for gold.
- Real Yields and Dollar: A strong dollar and rising yields may pressure gold, while dovish Fed signals or soft data would support upside.
- Geopolitical and Fiscal Risks: Safe-haven flows remain a wildcard amid growing fiscal concerns and trade uncertainty.
Current Price Behavior:
- Gold has consolidated below key highs, struggling to maintain upward momentum amid mixed U.S. signals.
- Direction remains tied to upcoming data and Fed communication.
Key Levels:
- Support: $2325, $2300
- Resistance: $2380, $2405
Forecast:
Gold remains in consolidation mode, with risk skewed to the upside if upcoming U.S. data disappoints or Fed signals a dovish shift. A break above $2380 would open the door to $2405. However, sustained strength in the dollar could force a test of $2325.
📊 Summary Table: As of May 28, 2025
| Asset | Bias (Short-Term) | Bias (Medium-Term) | Key Support Levels | Key Resistance Levels |
|---|---|---|---|---|
| 🇪🇺 EUR/USD | Bearish/Corrective | Bearish | 1.1376, 1.1315, 1.1269 | 1.1413, 1.1456 |
| 🇬🇧 GBP/USD | Capped Upside | Neutral to Bullish | 1.3542, 1.3474, 1.3434 | 1.3593, 1.3713 |
| 🇯🇵 USD/JPY | Weak Bullish | Bearish | 142.19, 141.52 | 143.07, 144.10, 144.80 |
| 🇳🇿 NZD/USD | Bearish | Bearish | 0.5900, 0.5845 | 0.6030, 0.6090 |
| 🪙 XAU/USD | Range-bound | Bullish | 2,330, 2,297, 2,263 | 2,375, 2,398, 2,420 |
