Solid Goold Trading

Monday’s Edition

With Nick Goold

The extension of the two-week Iran ceasefire helped global stock markets continue to rise last week. However, WTI oil prices also moved higher as traders stayed focused on the risk of oil supply disruption. Strong U.S. retail sales and better consumer sentiment data also showed that the U.S. economy remains strong.

Higher oil prices and strong U.S. data pushed long-term U.S. interest rates higher. This helped USD/JPY rise back close to the 160 level. In Japan, Finance Minister Satsuki Katayama said Japan is in close contact with the U.S. about possible action to stop further yen weakness.

U.S. company earnings also supported market sentiment, with around 84% of S&P 500 companies that have reported so far beating expectations. Gold fell as the stronger U.S. dollar encouraged selling. EUR/USD and European stock markets also fell as concerns grew that the Iran conflict could hurt economic growth, especially if oil supply remains disrupted.

Markets This Week

U.S. Stocks

Technology stocks moved to new record highs last week, but the Dow fell slightly despite better-than-expected U.S. economic data. The market remained cautious as the U.S. and Iran have still not reached a clear end to the conflict, while the extended ceasefire has made traders nervous about pushing stocks much higher. The Dow remains in a short-term uptrend, but a break below the 10-day moving average could trigger a fall, especially if WTI oil prices continue to rise. Resistance levels are at 49,600, 50,000, 50,500 and 51,000. Support is seen at 48,500, 48,000, 47,000, 46,000, and 45,000.

Japanese Stocks

The Nikkei index touched 60,000 last week as the extension of the U.S.–Iran ceasefire supported market sentiment and the yen remained weak. The market held above the 10-day moving average several times, confirming the short-term uptrend. However, if resistance around 60,000 holds and prices move below the 10-day moving average, the best short-term trading opportunity this week may be to look for a selling opportunity. Resistance is seen at 60,000, 60,500, 61,000, 61,500 and 62,000, while support is at 57,000, 56,000, 55,000, 54,000, and 52,000.

USD/JPY

Strong U.S. economic data and higher WTI oil prices supported the U.S. dollar last week, helping USD/JPY move back closer to resistance around 160 in quiet trading conditions. However, the risk of intervention by Japanese authorities continues to limit further gains. The Bank of Japan meeting could create volatility, especially if it signals a delay in future interest rate hikes, but for now, range trading between 157.50 and 160 remains the best short-term strategy. Resistance is at 160.00, 160.50, 162, and 165, while support is seen at 158.00, 157.50, 156.50 and 155.00.

Gold

Gold fell slightly last week as the stronger U.S. dollar and rising long-term U.S. interest rates encouraged selling. The market moved below the 10-day moving average, showing weaker short-term momentum. Overall, trading remained quiet as many commodity traders focused more on WTI oil. With the 10-day moving average pointing sideways, range trading is the preferred strategy this week. Resistance is at $4,900, $5,000, and $5,100, while support is at $4,650, $4,600, $4,500, and $4,400.

Crude Oil

WTI rose last week and tested the $100 level again after the two-week ceasefire was extended but negotiations to end the war failed. The Strait of Hormuz remained close to shut, keeping concerns about oil supply deliveries high. The situation in Iran remains unpredictable, so looking to trade against large moves may be the best strategy this week. Resistance is at $100, $110, and $120, while support is at $90, $80, $75, $70, and $67.5.

Bitcoin

Bitcoin tested old resistance around $75,000 last week and held above it as risk sentiment continued to recover. This helped the market move higher and showed that buyers remain active. Upward momentum appears to be growing, so further gains are possible as long as Bitcoin stays above the 10-day moving average. Resistance is at $80,000, $85,000, and $90,000 while support is at $75,000, $65,000, $60,000, and $55,000.

This Week’s Focus

Monday: None
Tuesday: Japan BoJ Interest Rate Decision, U.S. CB Consumer Confidence
Wednesday: Australia CPI, U.S. Durable Goods Orders, Housing Starts and Fed Interest Rate Decision
Thursday: Japan Industrial Production, E.U. CPI, Unemployment Rate and GDP, U.K. BoE Interest Rate Decision, E.U. ECB Interest Rate Decision, U.S. GDP, Core PCE Price Index and Chicago PMI
Friday: Japan Tokyo Core CPI, Australia PPI, U.K. S&P Global Manufacturing PMI, U.S. S&P Global Manufacturing PMI

This week, markets will focus on Iran news, oil supply risks, and three major central bank meetings. All three central banks are expected to keep interest rates unchanged, but the Bank of Japan meeting may have the biggest impact. Traders will watch for any comments about possible future rate hikes, especially with Japan’s economy still weak and USD/JPY near 160.

The U.S. Federal Reserve and the European Central Bank will also be important. Traders will focus on inflation, higher oil prices, and whether interest rates could still be cut later this year. Markets are likely to react quickly to WTI oil price moves and new headlines from Iran.