Solid Goold Trading

Monday’s Edition

With Nick Goold

Equity markets surged last week, with the Nasdaq and S&P 500 reaching record highs and Japan’s Nikkei climbing above 40,000 again. A ceasefire between Israel and Iran eased Middle East tensions, reducing fears of supply problems, boosting investor confidence, and sending crude oil prices down over 10%. Gold fell as tensions in the Middle East eased, reducing safe-haven demand.

U.S. economic data was weaker than expected. Both GDP growth and durable goods orders came in below forecasts, raising concerns about the economy. Former President Trump continued to pressure the Federal Reserve to cut interest rates. The U.S. dollar fell, with the USD Index hitting a new low for 2025, and long-term Treasury bonds continued to slide.

Bitcoin rebounded after dipping to $100,000, as improved risk sentiment encouraged investors to return to riskier assets. With geopolitical tensions easing and doubts growing about U.S. growth, markets are now watching the Fed and upcoming global data for direction.

Markets This Week

U.S. Stocks

U.S. equities had a very strong week, boosted by a ceasefire in the Middle East and growing hopes of a U.S. interest rate cut. Last week’s weaker-than-expected economic data, along with continued pressure from former President Trump for lower rates, was seen as positive for stocks. The uptrend looks set to continue now that the market has broken above the key 43,000 level. Resistance lies at 44,000, followed by 45,000, while support is seen at 43,000, 42,000, and 41,500.

Japanese Stocks

The Nikkei 225 surged last week after breaking above the 39,000円 level, despite ongoing U.S.–Japan tariff negotiations ahead of the July 8 deadline. Japanese equities took their cue from strong gains in U.S. markets and renewed buying interest as the Bank of Japan appears likely to delay any interest rate hikes. The rally may continue with the next resistance at 41,000円, followed by 42,000円. Support levels are now seen at 40,000円, 39,000円, and 38,000円.

USD/JPY

USD/JPY started last week strongly, rising on easing Middle East tensions, but ran into heavy resistance at 148, prompting a change in direction. A decline in long-term U.S. interest rates, driven by weaker economic data and ongoing pressure from former President Trump, led to broad U.S. dollar weakness. Technical indicators are pointing sideways, suggesting that a recovery followed by range trading looks likely this week. The pair now faces resistance at 145, 146, and 148, with support at 144, 143, and 142.

Gold

Gold was under pressure throughout last week as easing Middle East tensions encouraged selling. A strong U.S. stock market, reflecting increased risk appetite, also weighed on gold, which closed the week at its lowest level in over a month. After a significant drop, sideways price action is likely this week. Support is seen at $3,250 and $3,200, while resistance stands at $3,300, $3,350, and $3,400.

Crude Oil

U.S. efforts to reduce tensions between Israel and Iran led to a sharp drop in crude oil, with prices falling back to levels seen before the conflict began. The selling was aggressive and swift, as speculators rushed to exit positions. The market found support around the previous resistance level at $65, and volatility has since dropped significantly. While the situation remains fragile, there is still potential for renewed tensions, so looking for buying opportunities on dips appears to be the best approach. Support is at $65 and $60, with resistance at $70, $75, and $80.

Bitcoin

Bitcoin recovered strongly from the $100,000 support level as easing Middle East tensions saw speculators quickly return as buyers. The rally continued through the end of the week as overall risk sentiment improved. Both the short-term and medium-term outlooks are positive, so focusing on buying opportunities ahead of a potential test of $110,000 looks like the best approach this week. Resistance is at $110,000, $112,500, and $115,000, with support at $105,000, $100,000, and $95,000.

This Week’s Focus

Monday: U.K. GDP, U.S. Chicago PMI
Tuesday: Japan Tankan Survey, U.K. PMI, E.U. CPI, U.S. Federal Reserve Chair Powell speech, U.S. Manufacturing PMI
Wednesday: E.U. ECB President Lagarde Speaks
Thursday: U.S. Employment Data, U.S. Non Manufacturing PMI
Friday: U.S. Independence Day holiday

A quiet start to the week is expected, with few major news events as markets wait for progress on U.S.–Japan tariff negotiations ahead of next week’s deadline for the current tariff freeze. In the U.S., employment data will be released on Thursday instead of Friday due to the Independence Day holiday.

Tensions in the Middle East will also stay in focus to see if they rise again, but recent calm has reduced immediate concerns. The main theme for markets right now is the outlook for the next U.S. interest rate cut. Everyone will be watching Federal Reserve Chair Powell’s speech on Tuesday, which could give important clues about when the Fed might lower rates.