Alphabet – Can Earnings Volatility See a Range Breakout?Alphabet reports its earnings after the market close on Wednesday at a pivotal time in an on-going debate amongst retail traders and investors, over whether the AI trade is a bubble that is starting to deflate or is just taking a breather before initiating its next leg higher.
Alphabet, the owner of Google, is known as a hyperscaler, a company that operates a huge global cloud computing infrastructure. Its Google cloud platform is one of the giants powering the world’s AI, data and internet services, alongside Amazon Web Services (AWS) and Microsoft Azure. More importantly, it’s the first of these key companies to report its earnings. With traders extremely sensitive to levels of AI capital expenditure and on red alert for any signs suggesting this huge spending is starting to generate some significant returns, the outcome of this event could be important, not just for the Alphabet shares but also short-term sentiment toward the entire market.
The Alphabet share price topped at an all-time high of 404.38 on May 18th and has since been range trading between a low of 333.20 hit on June 26th and a high of 374.23 briefly seen on Thursday July 16th, before jitters resurfaced surrounding the AI model released by Chinese startup Moonshot, which saw prices drop back down to a low of 345.51 at the Friday close. However, at the start of this week, the Alphabet price has since rebounded to trade back at 353.15 ahead the company’s earnings release tomorrow.
Interestingly, with so much potential for price volatility resting on the outcome of these earnings, the technical outlook provides a key snapshot of the important levels traders may find useful to monitor, depending on how far the Alphabet results and management guidance deviate from market expectations.
Technical Update: Range Activity Builds Ahead of Earnings between 333.20 and 377.83.
The important focus for Alphabet this week is the release of its latest earnings report after the close on Wednesday and the potential for increased volatility that could result.
As the chart above shows, the earnings data could be important for the Alphabet stock price, with potential for more prolonged directional phases of price activity developing, especially as recent moves have seen prices confined within a sideways range between 333.20 (June 26th low) and 377.83 (61.8% retracement).
We discuss the technical outlook below and attempt to identify the key support and resistance levels that may become relevant if a breakout was to occur.
Potential Resistance Levels:
It appears that the Bollinger mid-average currently at 353.15 could represent the first resistance level this week. How this level is defended on a closing basis may be a gauge on short term price activity. If the Alphabet stock price was to close above 353.15 further upside strength may ensue, but while it caps prices, downside pressure may continue to materialise.
As the chart below shows, if the Alphabet share price were to close above 353.15, it could open potential to test 377.83, which may mark the upper extremes of the current sideways range. 377.83 is equal to the 61.8% retracement level calculated from the May high to June low and could be the key resistance to monitor.
If closes in price are seen above the resistance at 377.83 this week, it might suggest scope for moves to higher levels. This could shift the focus towards 389.63, which is equal to the May 27th high, even on towards 404.38, the May 18th upside extreme.
Potential Support Levels:
While the mid-average resistance at 353.15 continues to cap prices on a closing basis, the risk of further downside pressure may increase. This could shift the focus for traders toward a key support at 333.20 (June 26th session low), which could highlight the current lower range extreme.
A closing break below 333.20 may open potential for further declines to 322.85, which is the 61.8% retracement level (March low to May high). A closing break below 322.85 could see moves extend toward 309.44, which is the April 9th session low.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
US 100 - Bubble Fears Are Back Driving SentimentA sell off in previously high-flying chip stocks was a key reason why the US 100 index dropped 3.9% last week from opening levels at 29800 on Monday down to a close of 28566 on Friday. Sentiment has turned down at the start of July as fears of an AI bubble resurface once more, repeating a pattern of risk on then off again that has been witnessed by traders in this very popular area of financial markets since the middle of last year.
Looking forward, the huge capital expenditure being committed to artificial intelligence by several of the world biggest companies and whether it’s generating commensurate revenue returns is once again being questioned just days before Tesla and Alphabet report their latest earnings on Wednesday (after close), and 10 days before Microsoft, Meta and Amazon provide their next updates. These stocks carry a large index weighting meaning their actual results, future revenue growth predictions and capital expenditure forecasts could contribute to outsized directional moves in the US 100 across this crucial two week period into the end of July.
The technical outlook is potentially flagging an interesting dynamic that may also be worth monitoring.
Technical Update: Downside Focus Potentially Shifting to Last Low at 28206
Since posting the all‑time high at 30776 on June 3rd, the US 100 index has traced out a period of choppy sideways activity, as a decision‑making process appears to have formed between buyers and sellers. The lower limits of this sideways pattern could be marked by 28206, the June 9th low, which has held throughout the recent consolidation pattern.
However, as the chart above shows, price weakness is currently emerging after a failure to breach previous session highs on a closing basis. This price action has created a series of lower highs, which could leave traders wondering if this type of price activity is an indication of negative sentiment emerging.
Within this backdrop, being aware of potential key support and resistance levels may prove useful to establish where the next directional risks could lie this week as the key risk events play out.
Potential Support Levels:
In technical analysis, if there is a suspicion of potentially negative weak tests of previous price highs, it is often the last correction low of the previous uptrend that becomes the key support focus for traders, as closing breaks below this level can lead to further price weakness.
In the case of the US 100 index, this dynamic could bring 28206, the June 9th downside extreme into play as this level may represent the last correction low and therefore may be the first key support focus for the coming week.
While not a guarantee of continued price declines, closing breaks below 28206 could open the way for further downside momentum to emerge. Such moves, if seen, could suggest scope toward 27696, which is the 38.2% retracement, possibly then the deeper 50% level at 26753.
Potential Resistance Levels:
Of course, the support at the 28206 low is currently still intact, and while this remains the case, it’s possible the choppy sideways range can extend further. If this is the case, closing breaks back above 29239, which is equal to the 38.2% Fibonacci retracement of the latest decline, may be required to open potential for a push to higher levels.
Closing breaks above 29239 could be viewed as an indication of upside re‑emerging. If this is the case, risks may shift toward further price strength to test the next resistance at 29434, the current level of the Bollinger mid‑average, and if this is also breached, on toward 29791, the higher 61.8% retracement level.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted. Bitcoin Rebounds off Long Term Support, can the Rally continue?Bitcoin has risen 1.16% this week, keeping the world’s biggest cryptocurrency on course to register its third weekly gain in a row, something it hasn’t achieved since April. This price action could be an on-going response to its test of long-term technical support at 57,866 (see main chart) in early July, from which dip buyers reappeared taking the price up 12.5% from its low at 57699 (July 1st) to the current level around 64,900 at the time of writing (0645 BST).
From a macro perspective this week, Bitcoin prices may have found support from a recovery in general risk sentiment as cooler than expected US inflation prints on Tuesday and Wednesday, have seen market concerns regarding a Federal Reserve rate hike at their next meeting on July 29th reduce significantly, despite Fed Chair Kevin Warsh commenting in his testimony to Congress on Tuesday that one month of lower US inflation prints is not enough to confirm the Fed’s job to cap rising prices is done.
Looking forward, traders may be focusing on the direction geopolitical risks in the Middle East take moving into early next week. Assessing these developments against the current technical backdrop, which is outlined below, to determine whether the current Bitcoin rally has further to run.
Technical Update: Back to Important Long Term Technical Support:
Bitcoin has fallen more than 54% from the October 2025 all‑time high at 126,304 into the June 2026 low of 57,699, leaving a negative momentum backdrop and pattern of lower highs and lower lows. Traders tend to view this as a downtrend in price, with risks for further extension if sellers remain evident. However, as the weekly chart below highlights, the decline has recently tested what may be an important longer‑term support area.
This potential support sits at 57,866, which is the 61.8% Fibonacci retracement of the rise from September 2023 to October 2025. In technical analysis, the 61.8% level is often viewed as the most important Fibonacci retracement, because if prices close below the identified retracement level, it may lead to an extended period of price weakness, possibly moving all the way down to where the price strength began. In the case of Bitcoin, it’s perhaps not surprising that a bounce has materialised after 57,866 was tested.
Looking forward, traders could now be trying to establish where key support and resistance levels sit to gauge whether the Bitcoin rally could extend, or if the downtrend may resume.
Potential Support Focus:
We have suggested that the 61.8% retracement level at 57,866 could be a key long‑term support, however moving to the daily chart (see below) shows closer support levels that may need to give way on a closing basis if prices are to eventually retest 57,866 again.
While uncertainty amongst traders regarding the Iran conflict on Monday did bring renewed selling pressure for Bitcoin this week, it was the rising Bollinger mid‑average, currently at 62,497, that held and helped to spark the latest phase of price strength. This may mean that closes below 62,497 could open potential tests of the next support at 61,254, which is the July 6th low and rally point. If that level were also broken, risks could shift again toward the 57,866 retracement level. Ultimately, it may prove to be closes below 57,866 that lead to further price declines.
Potential Resistance Focus:
While short term support at 62,497 remains intact, Bitcoin could keep trying to extend its current recovery. However, the latest price strength has been capped by resistance at 65,558, which is the June 22nd high. If Bitcoin is going to build fresh upside momentum, traders could be watching this level, as breaks above it may be viewed as a sign the market may be attempting to move higher again.
Breaks above 65,558, as the daily chart above shows, could see focus shift to 67,425, which is the 38.2% Fibonacci retracement of the decline from May 5th to July 1st. If Bitcoin closes above 67,425, it may then have room to move toward 70,259, the 50% retracement, and possibly even 73,236, the higher 61.8% Fibonacci level.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
Gold – Feeling the Pressure of Rising Fed Hike ExpectationsGold moves have become increasingly sensitive to the swing from ceasefire to escalation of hostilities between the US-Iran, as the resultant spike in energy markets has raised fears amongst traders of a Federal Reserve rate hike, something that historically weighs on prices.
Events in the Middle East yesterday, where President Trump reinstated a blockade of Iran as both sides traded missile strikes saw the Gold price drop 2.87% from opening levels at 4098 down to a low of 3987, before eventually closing back at 4001.
However, in the short term, it may be the case that buyers of Gold remain in place between 3959, the June 24th low, and 4000 (more on this in the technical update below), however events later today may see their resolve tested by the release at 1330 BST of the latest US Consumer inflation reading (CPI), which could reintroduce the potential for a Fed rate hike at their next meeting on July 29th, depending on how far the actual reading deviates from market expectations.
Also important, could be the comments made by Fed Chair Kevin Warsh in his first testimony to Congress which is due to start at 1500 BST. Anything he says regarding the on-going impact of the Iran conflict, inflation or the potential for future Fed rate hikes could lead to an extended period of volatility for Gold into the Friday close.
Technical Update: Downtrend Themes Continue:
Gold established a new correction low at 3959 on June 24th, from which a short‑term recovery materialised in what appears to be a reaction to over‑extended downside conditions. However, last week and yesterday saw fresh weakness emerge, with the rally reversing from resistance at 4171, a level equal to the 50% Fibonacci retracement of the June 17th to 24th decline. This rejection keeps the broader price pattern of lower highs and lower lows in place, and opens the possibility of further weakness, if selling pressure continues to be seen.
As such, traders may be assessing where the next key support and resistance levels could lie to gauge the potential for bigger directional moves or reversals.
Potential Support Focus:
The June 24th low at 3959 is possibly the key support level for Gold this week. Having seen the recent recovery develop from this level, how 3959 is defended on a closing basis may be important for future direction. Closing breaks below 3959, if seen, could act as a catalyst for further downside momentum.
If 3959 were to give way, downside risks could shift toward the October 28th low a 3887. A closing break below 3887 could expose the potential of further price declines and turn the downside focus toward 3819, which is the October 2nd extreme. Should 3819 also fail on a closing basis, the next level may become 3628, which is the September 18th low.
Potential Resistance Focus:
While the support at 3959 remains intact, Gold still has scope for further recovery attempts. However, on the resistance side, it may be the 4100/4171 band that is the key area for traders to monitor. This zone aligns with both the declining Bollinger mid‑average and 50% Fibonacci retracement, which capped the market last week. If Gold can close above this 4100/4171 area, it may lead to upside momentum materialising.
If Gold were to close above 4171, it could open risks of further recovery attempts toward 4229, which is the 61.8% retracement of the June 17th to 24th decline. Breaks above 4229 could then see the Gold price extend toward 4382, which is a level equal to the June 17th session high.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
US 500 - Will Q2 Earnings, Inflation and Fed Warsh Shift SentimeAfter riding the wild swings driven by shifting AI hype and sky high valuations, then the escalation of tensions in the Middle East between the US and Iran, the focus for US 500 traders this week may shift back for a period to more event driven dynamics.
Q2 earnings season started last Thursday when PepsiCo reported, but it gets into full swing this week with the major US banks, such as Bank of America, JP Morgan, Citigroup, Goldman Sachs and Morgan Stanley reporting on Tuesday and Wednesday, then shifts to a tech focus with TSMC, the world’s largest manufacturer of advanced AI chips and a key supplier to important US 500 constituents NVIDIA, Apple, AMD and Broadcom, reporting before the open on Thursday, and then Netflix reporting after the close. Q2 performance may take on a greater emphasis this time around as traders want to see if the current stretched valuations are justified and whether management flag any cost or future revenue concerns created by the on-going Iran conflict.
Not only that, but traders will also receive the outcome of the latest US inflation readings, with consumer inflation (CPI) due on Tuesday at 1330 BST and then factory gate inflation (PPI), due at the same time on Wednesday. While market expectations for a Fed rate hike at their meeting in late July may have reduced, the jarring impact of a resumption of hostilities in the Middle East, have seen rate hike expectations for a move later in the year spike again, something which has weighed on US 500 prices. This topic is something that Fed Chair Kevin Warsh may discuss in his first testimony to Congress which commences at 1500 BST on Tuesday.
Looking forward, the US 500 has dropped 0.6% from 7560 to 7530 at the start of the week as traders respond with caution to conflicting reports on the closure of the Strait of Hormuz to oil shipping and prepare for the possible volatile week ahead.
What happens next could be influenced by shifting event driven sentiment and the response to the latest technical outlook, outlined below.
Technical Update: Decision Making Process?
Since the US 500 index posted its current all-time high of 7625 on June 2nd, more balanced themes have dominated. This has been reflected by a period of sideways activity, as price strength has been met by selling pressure to turn activity lower, only for buyers to emerge and reverse price weakness back to the upside.
What is particularly interesting about this activity, which suggests more balanced sentiment themes, is that the June price highs are at lower levels each time, while recent lows have been at a higher levels each time.
In this type of environment, a closing break above the latest failure high, or below the recent correction low is usually required to confirm which side has been able to come out on top and establish a more sustained price move in the direction of the eventual price break.
Potential Support Levels:
If the current sideways activity is to be resolved to the downside in a negative fashion, traders may be focused on the June 26th last correction low of 7300. Closing breaks below 7300 might be required to suggest downside momentum is emerging again, with risks of moves to lower levels.
Closing breaks below 7300 could trigger a deeper retracement of the March 31st to June 2nd advance, with scope toward 7208, equal to the 38.2% Fibonacci retracement and possibly then 7106, the April 29th low.
Potential Resistance Levels:
Of course, it is equally possible buyers begin to gain the upper hand, resulting in a more extended phase of price strength. If this is the case, it may be closing breaks above the latest failure high posted on June 15th at 7583 that is required to suggest it.
If the 7583 level is broken on a closing basis, it could lead to further price strength toward 7625, which is the June 2nd upside extreme, possibly even 7774, a level equal to the 38.2% Fibonacci extension.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
Oil (WTI) – Experiencing a Stress Test of Market PositioningJust as traders were starting to get comfortable with the Oil (WTI) price below $70 at the start of July, attacks on three commercial ships navigating the Strait of Hormuz early on Tuesday morning, which were blamed on Iran, initiated a chain of events that are challenging market positioning in energy markets.
In response to the attacks on oil shipping, the US struck over 80 sites in Iran on Tuesday and crucially revoked a waiver allowing new sales of its oil, drawing a retaliatory response from Iran. The US followed this up with a further 90 targeted strikes overnight, to which Tehran again responded.
More important to the direction of Oil prices may be the comments of US President Donald Trump which were made after the first series of strikes, who suggested that the interim agreement signed on June 17th may be over, raising the possibility of the beginning of a new phase of full-on conflict between the two nations.
Perhaps unsurprisingly, Oil prices spiked on the news, and volatility has increased as traders try to determine whether this is more brinkmanship on the part of President Trump or peace negotiations are officially over and hostilities will resume, which may stop the flow of Middle East supplies through the Strait of Hormuz for an extend period. A move which could see a deeper upside squeeze to Oil market positioning. After opening the week at 68.982 and briefly falling to a low of 68.222, prices jumped aggressively up to 76.417 yesterday afternoon before pulling back to 74.50 at the time of writing (0630 BST) as market participants try to work out what comes next.
Looking forward, traders may need to monitor newswires closely for fresh updates from Washington and Tehran to determine whether events are escalating or pulling back from the brink of fresh conflict. Reassessing the current technical outlook may also be important.
Technical Update: Sharp Rally - Reaction or Reversal?
The re‑escalation of the US-Iran conflict has driven a strong Oil (WTI) price rally over the past couple of days, but it comes directly after a 32% decline from the June 3rd high into the July 2nd low. Set against that backdrop, traders may see the latest strength as a short‑term reaction to over-extended downside conditions rather than a meaningful shift in trend.
Of course, if geo‑political concerns continue, they could provide the catalyst for additional price strength over coming sessions. In this type of environment, traders often place greater emphasis on key technical levels, as they help determine whether the latest rally is simply a reactive bounce or the beginning of a more meaningful shift in directional momentum.
With that in mind, reassessing the charts to identify both support and resistance levels that may influence price action and direction could be important.
Potential Resistance Levels:
After an extended phase of weakness, any recovery often begins as a reactive bounce, driven more by over-extended downside conditions than by a confirmed shift in trend. In these situations, the 38.2% Fibonacci retracement level of weakness typically acts as a potential resistance point. This suggests that while further price strength may be seen in Oil, it could be the 38.2% level that marks the first key resistance level and how its defended on a closing basis should be monitored.
As the chart above shows, the 38.2% retracement level stands at 79.54 and closing breaks above 79.54 may now be required to lead to further upside momentum, resulting in the recent recovery extending toward higher resistance levels. If such a break is seen, it may open scope for tests of 83.31, the 50% Fibonacci retracement of the latest decline, and if 83.31 then gives way on a closing basis, on toward 87.08, the 61.8% retracement.
Potential Support Levels:
So far, the 79.54 retracement resistance remains intact on a closing basis, and while this is the case, the risk of downside moves may increase. If weakness develops, focus might shift to 72.00, a level equal to half the latest rally, as a possible support level.
A closing break below 72.00 may suggest further downside pressure, potentially exposing the next support at 67.55, which is the July 2nd low. A closing break below 67.55 could see risks extend toward 61.88, the February 17th low.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
Dow Jones Index (US 30) – Can the Uptrend Continue?The Dow Jones Index (US 30) has been on an impressive run of late, trading from a low of 49762 on June 11th all the way up to a register a new all time high of 53224 this morning, that’s a gain of 7%. Rotation has been a big part of the story, as traders look to move out of high valuation AI stocks back into potentially safer, cash rich blue chip US corporates. A more settled geo-political backdrop in the Middle East has been another factor, although the truce between US-Iran remains fragile meaning traders may need to pay attention to reports such as those out earlier today of Iranian missile strikes on 2 commercial ships transiting the Strait of Hormuz (Bloomberg), or updates on when the next round of peace talks to bring an official end to the conflict may begin, just in case they increase index price volatility.
While Friday’s weaker US jobs report saw market expectations of a Fed interest rate hike at the end of July drop to around a 20% chance (Bloomberg), sensitivity remains regarding the differing views of Fed policymakers toward inflation and the potential need for rate hikes later in the year. Looking forward on the event front, tomorrow’s release at 1900 BST of the minutes from the June Fed meeting could bring some clarity to this situation but could also generate some index moving headlines, so staying alert and apprised of the technical backdrop could be a prudent approach.
Technical Update: Can the Uptrend Continue?
It could be suggested that Friday’s price activity in the Dow Jones Index (US 30) reflected trader indecision over whether recent price strength can extend without a correction developing first. This was highlighted by a neutral Doji pattern within candlestick analysis, where Friday’s session opened and closed at the same level, leaving a daily candle with no real body, as can be seen on the main chart.
A reason for this indecision may have been the run‑up to the July 4th holiday, meaning the early price action this week could reveal whether the uncertainty is meaningful or simply a short‑term pause in what has already been a strong advance. With this in mind, it could be useful to monitor key support and resistance levels to assess where directional risks may emerge into Friday’s close.
Potential Support Levels:
If trader uncertainty develops into further price weakness, the initial focus could turn to the 52450 level which is equal to half of the latest price strength. Closing breaks below 52450, if seen, could then lead to further declines.
Breaks below 52450 could trigger a deeper retracement of the June 11th to July 3rd advance, with scope toward 51912, which is equal to the 38.2% Fibonacci retracement and, if that were also to give way on a closing basis, possibly even 51506, the deeper 50% level.
Potential Resistance Levels:
As the chart below shows, an uptrend condition which is a positive pattern of higher highs and higher lows, does currently remain in place. So, while support at 52450 continues to hold on a closing basis, it may indicate that last Friday’s indecision is not an important development, opening the way towards further price strength.
If this is the case, closing breaks above the latest all time high of 53224 (July 7th) could develop. If seen, this may increase the risks of further upside momentum to test 54016, which is equal to the 61.8% extension and, if that were also to give way, 56179, which is the higher 100% extension.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
Silver – Another Rally Within The Longer Term Downtrend?Silver has experienced a reversal of its fortunes over the last 2 weeks, trading from 7-month lows hit on June 23rd at 55.589 all the way up to close on Friday, July 3rd at 62.369. Perhaps unsurprisingly this rally has coincided with the reopening of the Strait of Hormuz, which has seen oil plummet back below $70, easing inflation concerns which had weighed heavily on Silver during June. Not only that, but Thursday’s weaker US jobs numbers saw expectations for Federal Reserve interest rate hikes, possibly as early as the end of July, ease back, reducing the downside pressure on Silver and other precious metals that pay no interest or dividends.
Looking forward, the week ahead is light on events, other than the release of the Fed minutes from their June meeting, the first under new Chair Kevin Warsh, which are due on Wednesday at 1900 BST. This may mean price action, sentiment and the technical outlook could take on greater significance. The Monday open has seen prices drop 1.2% down to 61.609 at the time of writing (0700 BST), which may suggest a nervy few days ahead for Silver traders..
Technical Update: Is This Another Rally Within the Downtrend?
A recovery has developed from the June 23rd low at 55.589, driven by short‑term over‑extended downside conditions, but traders may now be assessing whether this is simply a limited rally, or the start of a positive sentiment shift capable of producing a more extended phase of strength.
Since that low at 55.589, daily candles have shown small real bodies and long upper/lower shadows, signalling consolidation rather than directional conviction. Unless key support or resistance levels are broken in the week ahead, this type of indecisive activity could persist.
So what are those potential support and resistance levels?
Potential Resistance Focus:
With a pattern of lower highs and lower lows in price still evident, it might be argued that a downtrend pattern remains in force. If this is the case, it may prove to be the declining Bollinger mid-average, currently at 63.212, that marks the first key resistance level. If potential is to turn toward further price strength, it could well be closes above 63.212 that are required to see it.
Closes above 63.212, if seen, could prompt traders to look for a more extended upside retracement of the January/March decline. This may result in further upside toward 68.283, which is the 38.2% Fibonacci retracement level, and potentially then 72.237, the higher 50% level.
Potential Support Focus:
If the Bollinger mid-average resistance at 63.212 continues to cap any future rally in Silver over upcoming sessions, risks may turn towards a fresh phase of price weakness. As the chart below shows, the first support level might prove to be 55.589, which is equal to the June 23rd low. Within the current backdrop, it might prove prudent to monitor how 55.589 is defended on a closing basis to assess if continued price weakness may emerge.
As the chart above illustrates, a break below 55.589 could see downside momentum increase, with the next support perhaps being marked by 48.619, which is the low trade posted on November 21st 2025, maybe even 45.533, the low posted on October 28th 2025.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
NVIDIA – Facing A Technical Correction Test?NVIDIA is a stock at the heart of the AI trade and while much has been made of AMD and Micron in recent weeks, it remains the benchmark against which all in the chipmaker sector are judged against. After a stellar run in May, June has been a volatile month for AI stocks which has seen NVIDIA in particular fall from a high of 231.79 on June 3rd down to a low of 189.54 on Monday, before recovering to its current level at 197.20. Monday’s drop to 2 month lows brings an interestingly technical level into play, which could have implications for not only the direction of NVIDIA stock but also the entire AI sector in general as we move forward into the early days and weeks of Q3.
This technical update is outlined below and could be something worth monitoring through the important event risk tomorrow when Fed Chair Kevin Warsh speaks at 1400 BST and then on Thursday when the latest US jobs report is release at 1330 BST.
Technical Update: Facing Technical Correction Test?
When trading any market, there are times when important support or resistance levels are tested or even broken, which can lead to directional moves either up or down. NVIDIA’s share price has recently seen a strong sell‑off and has tested one of these possible levels at 191.84, equal to the 61.8% Fibonacci retracement of the March 30th to May 14th advance.
Within the Fibonacci approach, three retracement levels are used after a phase of strength or weakness — 38.2%, 50%, and 61.8%. Looking at the NVIDIA chart above, each of these levels has recently played a role in highlighting potential of directional moves.
The 208.63 level, which was the 38.2% Fibonacci retracement, initially held and prompted a bounce, but closing breaks on June 5th triggered weakness toward 200.17, the deeper 50% level. While this also held briefly, renewed weakness saw closing breaks lower that has now taken price to 191.84, the deeper 61.8% level.
This illustrates how traders can use Fibonacci retracements to gauge whether a break of one support is occurring and to identify the next potential support, which in the case of NVIDIA, has been the next Fibonacci level.
Fibonacci techniques suggest NVIDIA has again tested key support at 191.84, and traders may anticipate at least a recovery attempt from that point. However, they will also monitor closing defence of 191.84, as closing breaks lower could lead to further price declines.
What are the Risks if 191.84 is Broken on a Closing Basis?
A closing break below the 61.8% retracement can be a potential trigger. Some traders even suggest risks may turn toward a revisit to where the original move began, which for NVIDIA is 164.28, the March 30th session low.
However, as the chart above shows, there are possible supports evident between the 191.84 and 164.28 levels. Therefore, closing breaks under 191.84 if seen, could result in price weakness, but earlier support levels might come into play. For instance, the April 10th low at 184.80 could be a focus on a downside break of 191.84, even then 180.33, the April 8th session extreme, possibly further.
What if 191.84 Support Remains Intact on a Closing Basis?
The 191.84 retracement is currently holding on a closing basis, and while this continues, risks may be for a more extended phase of price strength. In this case, traders may monitor 203.75, equal to the June 23rd session high.
As the chart above shows, if closing breaks above 203.75 are seen, the next resistance might prove to be 206.04, which is the 38.2% retracement. If this level is then beached on a closing basis, focus could shift to 211.36, a level equal to the 50% Fibonacci retracement, possibly further.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
EURUSD - Is the Short-Term Low Now in Place?Last week (June 24th), EURUSD traded at 1.1324, a one year low, the result of diverging interest rate outlooks between the ECB and Federal Reserve.
On the EUR side, traders embraced more dovish rhetoric to cut back their expectations for future ECB interest rate hikes after central bank President Christine Lagarde suggested that she doesn’t see any need for a more aggressive response to combat a surge in inflation created by the Iran war, while Preliminary PMI surveys for the Eurozone’s two biggest economies, France and Germany showed economic activity shrank in June, a warning sign that growth in the Eurozone may be stalling.
On the USD side, it was a different story, with economic data remaining resilient and Fed speakers continuing to flag their inflation concerns, adding support to the recent narrative that the US central bank may stand ready to hike rates as early as its next meeting at the end of July.
Since its Wednesday low, EURUSD has rebounded, traded several times up to the 1.1430 area before dropping back to 1.1395 again at the time of writing (0645 BST). This price action poses the question, are FX traders readying themselves for a fresh assault on the downside or is the short-term low in place and a deeper squeeze possible?
The answer to that question may be contained in the outcome of 3 key events scheduled for tomorrow and Thursday. The first is the release of preliminary inflation data for the Eurozone at 1000 BST. EURUSD traders may be watching closely to find evidence supporting or contradicting the recent interest rate outlook provided by ECB President Lagarde. Then, later in the day at 1400 BST Madame Lagarde and Fed Chair Warsh, share the stage at a central bank event organized by the ECB in Sintra, Portugal. Their comments on inflation, economic growth, future rate moves and the Iran conflict could keep FX market volatility elevated into Thursday, when traders receive the latest US Non-farms jobs report at 1330 BST.
With all of this and the early capital flows at start of Q3 to account for, being prepared for bigger directional moves could be a sensible decision.
Technical Update: Recovering from Retracement Support:
Having posted a recovery high of 1.1849 in April, EURUSD has since seen a retreat of 4.4%, taking the pair last week to its lowest level since late May 2025 at 1.1324. This type of move would normally attract trader attention given the potential for further declines. However, as the weekly chart below shows, this sell-off has tested a potential long-term support at 1.1359, the 38.2% Fibonacci retracement of the January 2025 to January 2026 advance.
A 38.2% retracement can act as an important support focus, and with the 1.1359 level remaining intact on a weekly closing basis, fresh attempts at upside have so far emerged this week. The key question now is whether 1.1359 represents a base for a more extended recovery, or if the bounce is simply a limited recovery within a broader downside phase.
Potential Resistance Levels:
The recovery from the support at 1.1359 has confirmed buyer interest is currently present around this area. However, if a more extended phase of strength is to develop, closing breaks above resistance provided by the 38.2% retracement of June weakness at 1.1439 may be required to open the way for more extended upside moves.
If 1.1439 were to give way on a closing basis, attention could shift toward 1.1475, which is the 50% retracement level. A break above 1.1475 may then open scope toward 1.1510, the higher 61.8% retracement.
Potential Support Levels:
We have already suggested that it is the 38.2% long term retracement support at 1.1359 that is a possible longer term focus, but this may only be important if EURUSD closes below it on Friday. However, as discussed above, there is a significant amount of new data traders will need to digest before then, suggesting shorter term levels could also play an important role before the end of the week.
The first key short-term support could be 1.1379, which is equal to half the latest rally. Breaks below this level could lead to further price declines toward 1.1324, which is the June 24th session low, then 1.1211, a level equal to the May 29th 2025 extreme.
On a longer term outlook, Friday’s close could tell us a lot about the where EURUSD may move next in the first month of Q3. If the long-term retracement support at 1.1359, has been broken on a weekly closing basis it may suggest a deeper retracement of the January 2025 to January 2026 price strength could be on the cards.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
US 500 – A Pivotal Trading Period to Start Q3The US 500 starts the new week at a pivotal moment, rocked over the previous 5 trading days by the latest sell off in AI stocks which according to Bank of America led to net outflows from US equity funds in the week ending June 24th for the first time in 3 months (Bloomberg), and by a resumption of attacks by the US and Iran on each other that threatened the fragile stability in the region. These events saw the index open on Monday 22nd June at 7485 and end the week 1.9% lower at 7345.
Today’s price action has been more constructive, with US 500 traders reacting positively to news reports released on Sunday that the US and Iran had agreed to stop attacking each other and are likely to resume technical talks on Tuesday aimed at bringing an official end to the war. This has seen prices move briefly up to a high of 7404, before settling back to trade +0.65% at 7393 at the time of writing (0700 BST). However, it is possibly too early to decide whether this move is sustainable given the important events packed into a week shortened by the US Independence Day holiday on Friday.
Looking forward, the outcome of Tuesday’s peace talks between the US-Iran may grab headlines, but on Wednesday the focus could shift to comments made by Federal Reserve Chair Kevin Warsh when he speaks at 1400 BST from a central bank event organised by the ECB in Sintra, Portugal. With traders nervous about inflation and rate hikes, the direction of the US 500 is likely to remain sensitive to any updates that he makes on these topics. Then on Thursday, the latest US non-farm payrolls report is due for release at 1330 BST, and it could be worth monitoring whether the headline jobs number remains resilient, and if the unemployment rate remains around 4.3%, which could see market expectations for a Federal Reserve rate hike on July 29th increase, a potential negative for sentiment toward the US 500. Or, if there are signs of weakness in the headline and the unemployment rate climbs, something which could see rate hike expectations put on hold until later in the year, a possible positive for the direction of the US 500.
With so much to absorb in a short period, there could be potential for extra price volatility in the US 500 to start Q3!
Technical Update: Weak Test of June Highs in Place?
Within technical analysis, an uptrend is defined by higher price highs and higher price lows, where a setback after a new recovery high is followed by buyers re‑emerging and generating enough strength to break and close above the previous high. In this type of price behaviour, traders anticipate continued price strength to maintain the positive momentum.
However, when a phase of strength fails to overcome the previous high, it is often viewed as a ‘weak test’ of that upside extreme, especially if it is followed by fresh price weakness.
In the US 500 index, as the chart above shows, strength into the June 15th high failed below the June 2nd extreme at 7625, followed by the latest price decline. While this doesn’t guarantee further weakness, traders may look to define key support and resistance levels that could determine whether a more extended correction is possible, or if the weakness proves limited before fresh upside returns.
Potential Support Levels:
If the recent price activity is developing into a ‘weak test’, the support focus often turns to the last correction low of the advance. For the US 500 index, this looks on the chart to be 7299, which is the June 11th session low and rally point.
Closing breaks below 7299 could trigger a deeper retracement of the March 31st to June 2nd advance, with scope toward 7208, a level equal to the 38.2% Fibonacci retracement and potentially then 7106, the April 29th low.
Potential Resistance Levels:
While support at 7299 remains intact attempts at price strength are still possible. If this is the case, the initial resistance level could stand at 7446, which represents the current price point of the declining Bollinger mid‑average.
If prices were to break above 7446 on a closing basis, attention may turn toward 7583, which is the June 15th high, and if this were also to give way, risks could then shift back toward the June 2nd upside extreme at 7625.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
Gold – Under Heavy Pressure With October Lows in SightAny positive momentum for Gold which saw it touch a high of 4382 last week after the US and Iran signed their interim peace agreement, seems to have evaporated quickly to be replaced with negativity linked to rising inflation risks that may increase the chance of global central banks keeping interest rates at elevated levels for a longer period or even raising them. A scenario which tends to weigh on Gold and other precious metals that pay no interest or dividend.
The double whammy for traders to manage is that the more hawkish outlook embraced by new Chair Kevin Warsh at last week’s Fed meeting, has also helped lift the US dollar to 1-year highs, further pressuring Gold prices which are priced in dollars and make the popular metal more expensive to purchase for international buyers. Yesterday, prices dropped to a new low for 2026 at 3959, and in doing so brought a 10-month extreme registered on October 28th at 3887 within touching distance.
Now, with Gold prices recovering slightly back around 3985 at time of writing (0645 BST) the focus for traders over the next 36 hours could be on the US PCE Index release later today at 1330 BST. This is the Fed’s preferred gauge of inflation, and while prices are anticipated to have risen, any print exceeding market expectations could see chances of a Fed rate hike in July increase, which may be a negative for Gold, while any surprise reading to the downside could lead to a more extended relief rally.
Technical Update: Focus Now on 3959 June Low:
While a period of price strength did emerge in Gold from the June 11th low into the June 17th high, traders appear to have viewed this as a limited reactive recovery within the ongoing price pattern of lower highs and lower lows. As the chart below shows, the rally was held and reversed by resistance at the declining Bollinger mid‑average (currently 4272), from which fresh weakness has developed, a move that on Wednesday saw closing breaks below the June 11th low at 4024.
Of course, an existing downtrend pattern does not guarantee further weakness, and traders could be trying to identify the next key support and resistance levels to gauge where the next directional themes may emerge.
Potential Support Focus:
Wednesday’s drop saw the 3959 level hold the decline and even see a minor bounce. As such, this level may be viewed as the first support focus. Closing breaks below 3959 over the upcoming sessions may lead to further price declines.
If 3959 were to give way on a closing basis, risks could shift toward 3887, the October 28th low as the next important support to monitor. Should that level also fail, focus might then move to 3810, which is the October 2nd extreme, which could represent a deeper potential support area.
Potential Resistance Focus:
While support at 3959 remains intact, attempts at a recovery are possible. If so, the first key resistance may stand at 4120, a level equal to the 38.2% Fibonacci retracement of the latest decline. If fresh strength is to materialise, closing breaks above 4120 may now be required to suggest it.
If prices were to close above the 4120, it could open scope toward 4171, which is the 50% retracement level, and then 4229, the higher 61.8% retracement level.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
Can the US 100 Index Break to New Highs?Last week, the US 100 index overcame a mid-week wobble on Wednesday created by Federal Reserve policymakers providing a more hawkish outlook at their rate meeting than was being anticipated. This saw it fall to a brief low of 29620 before recovering to end the week back at 30351, a mere 1.4% from its all-time high of 30776 registered on June 3rd. The reason for the strong rebound was Washington and Tehran both signing an interim peace agreement which opened the Strait of Hormuz to critical oil and gas shipments from the Middle East, while at the same time committing to further weekend talks with the aim of reaching a final agreement in 60 days.
Despite some initial confusion that these talks may have been halted on Sunday by renewed fighting between Israel and Hezbollah in Lebanon, the outcome of the discussions seemingly has been encouraging, seeing the creation of a roadmap toward reaching a final deal in 60 days, a line of communication for the safe passage of commercial vessels through the Strait of Hormuz and a mechanism for further technical talks later this week (Bloomberg). This has seen a sharp recovery in sentiment which has taken the US 100 from an early Monday low of 30,051 back up to current levels of 30,427 at the time of writing (0730 BST).
Looking forward, with events in the Middle East potentially looking more stable in the short term, traders may be asking if a new record high in the US 100 can be seen this week? There are 2 events that may have a major influence over whether this could happen or not. The first is the quarterly earnings report after the close on Wednesday from chip manufacturer Micron, who has been one of best performing companies in the semiconductor sector through 2026. Another strong quarterly performance could bring fresh positive attention to the AI trade, while disappointment could see the reverse happen. Then on Thursday at 1330 BST, the latest US PCE Index, the Fed’s preferred inflation gauge, is released. Traders may be monitoring this closely to determine how quicky the Fed may need to raise rates to combat inflation. Higher interest rates or rate expectations, tend to weigh on growth stocks in the US 100 and vice versa.
Technical Update: Consolidation in Uptrend or Trend Reversal?
The US 100 index has spent June in a choppy consolidation, unwinding the upside extremes of the strong advance seen between the March 31st low and the June 3rd high. This type of pause is typical after such a move, but it may still leave traders debating whether this is a limited correction within an ongoing uptrend or the start of a broader sentiment shift toward price weakness.
With the next directional themes still unclear, the price action around key short‑term support and resistance levels may define moves in the week ahead.
Potential Support Levels:
While the initial trade last week was for price weakness to materialise again, this decline found support at 29722, which is equal to the 38.2% Fibonacci retracement of the June advance. As the chart below shows, with this level holding on the downside and the development of fresh attempts to move higher, 29722 may be viewed as the first key support this week.
While not a guarantee of continued price weakness, closing breaks below 29722 could lead to continued price declines, resulting in a deeper retracement of the latest strength. Such moves could see further downside to 29427, the 50% retracement, possibly then the deeper 61.8% level at 29133.
Potential Resistance Levels:
The latest price strength has brought the June 3rd all-time high of 30776 back onto the radar screen. An all-time is always an important focus for traders, as having found selling pressure here before, it may be the case again. Therefore, if further price strength is seen this week, 30776 is set to be the first key resistance focus.
Closing breaks above 30776, if seen, could be viewed as an indication of upside momentum re-emerging. If this is the case, risks may shift toward further price strength to test resistance at 31751, a level equal to the 38.2% Fibonacci extension, and if this is breached, on toward 32355, which is the higher 61.8% extension level.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
Can the US 100 Index Break to New Highs?Last week, the US 100 index overcame a mid-week wobble on Wednesday created by Federal Reserve policymakers providing a more hawkish outlook at their rate meeting than was being anticipated. This saw it fall to a brief low of 29620 before recovering to end the week back at 30351, a mere 1.4% from its all-time high of 30776 registered on June 3rd. The reason for the strong rebound was Washington and Tehran both signing an interim peace agreement which opened the Strait of Hormuz to critical oil and gas shipments from the Middle East, while at the same time committing to further weekend talks with the aim of reaching a final agreement in 60 days.
Despite some initial confusion that these talks may have been halted on Sunday by renewed fighting between Israel and Hezbollah in Lebanon, the outcome of the discussions seemingly has been encouraging, seeing the creation of a roadmap toward reaching a final deal in 60 days, a line of communication for the safe passage of commercial vessels through the Strait of Hormuz and a mechanism for further technical talks later this week (Bloomberg). This has seen a sharp recovery in sentiment which has taken the US 100 from an early Monday low of 30,051 back up to current levels of 30,427 at the time of writing (0730 BST).
Looking forward, with events in the Middle East potentially looking more stable in the short term, traders may be asking if a new record high in the US 100 can be seen this week? There are 2 events that may have a major influence over whether this could happen or not. The first is the quarterly earnings report after the close on Wednesday from chip manufacturer Micron, who has been one of best performing companies in the semiconductor sector through 2026. Another strong quarterly performance could bring fresh positive attention to the AI trade, while disappointment could see the reverse happen. Then on Thursday at 1330 BST, the latest US PCE Index, the Fed’s preferred inflation gauge, is released. Traders may be monitoring this closely to determine how quicky the Fed may need to raise rates to combat inflation. Higher interest rates or rate expectations, tend to weigh on growth stocks in the US 100 and vice versa.
Technical Update: Consolidation in Uptrend or Trend Reversal?
The US 100 index has spent June in a choppy consolidation, unwinding the upside extremes of the strong advance seen between the March 31st low and the June 3rd high. This type of pause is typical after such a move, but it may still leave traders debating whether this is a limited correction within an ongoing uptrend or the start of a broader sentiment shift toward price weakness.
With the next directional themes still unclear, the price action around key short‑term support and resistance levels may define moves in the week ahead.
Potential Support Levels:
While the initial trade last week was for price weakness to materialise again, this decline found support at 29722, which is equal to the 38.2% Fibonacci retracement of the June advance. As the chart below shows, with this level holding on the downside and the development of fresh attempts to move higher, 29722 may be viewed as the first key support this week.
While not a guarantee of continued price weakness, closing breaks below 29722 could lead to continued price declines, resulting in a deeper retracement of the latest strength. Such moves could see further downside to 29427, the 50% retracement, possibly then the deeper 61.8% level at 29133.
Potential Resistance Levels:
The latest price strength has brought the June 3rd all-time high of 30776 back onto the radar screen. An all-time is always an important focus for traders, as having found selling pressure here before, it may be the case again. Therefore, if further price strength is seen this week, 30776 is set to be the first key resistance focus.
Closing breaks above 30776, if seen, could be viewed as an indication of upside momentum re-emerging. If this is the case, risks may shift toward further price strength to test resistance at 31751, a level equal to the 38.2% Fibonacci extension, and if this is breached, on toward 32355, which is the higher 61.8% extension level.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
Oil (WTI) – Focus on Movement Through the Strait!On Monday, Oil (WTI) prices gapped lower after the US and Iran both confirmed they had reached an interim peace agreement which would allow the Strait of Hormuz to reopen. This drop continued through Tuesday, to what was at the time a 3-month low at 76.261 as speculation grew regarding the impact unleashing these critical supplies from the Middle East region could have on oil prices.
Then, on Wednesday some uncertainty crept back in, were Iran fully on board with the deal, would the Strait reopen? This uncertainty helped prices spike briefly to print a high of 80.517. However, at this point President Trump stepped in. Once he confirmed that he had signed the interim peace deal ahead of schedule last night, he paved the way for oil prices to drop back down to new lows at 74.702 this morning (0700 BST).
Now looking forward, traders may be left in wait and see mode over the next 36 hours, watching and listening intently for updates on reports of the size and speed of actual shipping flows through the Strait of Hormuz. After all, there still could be room for disappointment or a surprise statement which may inject a nasty jolt of price volatility into the Friday close. In this environment, keeping apprised of the technical trend and levels that may come into play, could be useful.
Technical Update: Breaking Lower From Range?
Since the price volatility seen between the March 9th high and March 10th low, price activity in Oil (WTI) had formed a broad and choppy sideways range, with sentiment dominated by the various headlines regarding the US-Iran conflict. However, since posting the June 3rd high at 99.33, followed by the news of the agreement of an interim peace deal, prices have encountered selling pressure, resulting in a 24% decline, into the latest price correction low.
Within this phase of price weakness, closing breaks below not only the April 17th low at 82.60 but also the 62% retracement at 79.55 have materialised, a level which we recently suggested could mark the lower limits of the sideways range. While this type of break lower isn’t a guarantee of further weakness, it may now see some traders questioning whether risks may be turning to the downside. If this is the case, it could prove beneficial to reassess where the next key support and resistance levels may stand.
Potential Support Levels:
After the latest phase of weakness including the close below the 62% retracement at 79.55, further price declines could be possible. If this were to be the case, traders may initially be focused on the low posted on March 5th at 75.05, as defining the next key support level.
A closing break below 75.05 could suggest downside pressure is increasing which may open potential for moves to test the next support at 69.39 (March 2nd low). This level also giving way on a closing basis may see risks materialise for further declines toward 61.88, which is the February 17th low.
Potential Resistance Levels:
Following the gap lower at Monday’s open, a possible resistance point has been left at 83.17, which is Monday’s session high. If a more extended phase of price strength is to emerge, closing breaks above 83.17 may now be required to suggest it.
As the chart above shows, breaks above 83.17 could shift attention toward higher resistance levels, possibly opening scope for tests of 84.54, the 38.2% Fibonacci retracement of the June decline, and then the 50% retracement at 87.39.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
GBPUSD – Buckle Up for a Busy 48 Hours of Event Risk!While the details of a plan to reopen the Strait of Hormuz on Friday are finalised, the attention of FX traders may shift to other market drivers. Amongst the major currency pairs, GBPUSD perhaps has the most event risk attached to it, with key UK economic data, a Federal Reserve and Bank of England interest rate decision and a crucial UK local election to consider, all in the space of 48 hours. Throughout June so far, GBPUSD has been rangebound, trading between a high of 1.3483 from June 5th and a low of 1.3306 from June 8th. It could be possible that things are about to change and traders may need to prepare for a more volatile period ahead.
The power 48-hour event risk window starts at 0700 BST on Wednesday with the latest UK CPI reading. Inflation in the UK is expected to have risen again, driven higher by energy prices, so any surprise prints, above or below what the market anticipates, could impact on the direction of GBPUSD as traders prepare for the Federal Reserve (Fed) interest rate decision later in the day at 1900 BST. No change to US rates is widely expected, shifting the focus for FX traders to the comments made by new Fed Chair Kevin Warsh at his first press conference in charge. With US economic data resilient and inflation in May rising at its fastest pace for 3 years, his comments on future rate moves could send a fresh jolt of volatility through GBPUSD moving into Thursday morning.
Thursday’s attention shifts back to the UK and the GBP side of the currency pair. The initial focus is a local election in the town of Makerfield on the outskirts of Manchester. Andy Burnham, the current Mayor of Greater Manchester is standing for Labour. A win could see him make a swift challenge to current UK PM Kier Starmer’s leadership of the country, and given that Andy Burnham is seen as more likely to want to spend, this result could rock UK asset markets more than the Bank of England rate decision at 1200 BST, where policymakers are expected to keep rates unchanged again to buy time to assess another month of inflation and growth readings.
As you can see, preparing for GBPUSD volatility could be a wise move!
Technical Update: More Balanced Themes Ahead of By-Election:
When a period of sideways price activity develops in any asset, where buyers are active at the lower limits of a range and sellers at the upper extremes, it is generally viewed as a sign of balance in the market. This reflects neither side being able to dominate, resulting in choppy, sideways movement until a catalyst emerges that allows one side to gain the upper hand.
As the chart above shows, GBPUSD is currently caught within such a sideways range. On the downside, buyers have been active around 1.3303/06, the May 18th and June 8th lows, while any strength has been capped by resistance at 1.3525, a level equal to the 61.8% Fibonacci retracement of the early‑May decline.
A close below 1.3303 or above 1.3525 may be required to suggest a breakout is materialising and help to provide an indication of where the next directional themes may lie.
Potential Resistance Levels:
We have already noted that 1.3525 appears to mark the upper boundary of the current balanced range. As such, closing breaks above 1.3525 may be needed to trigger further attempts to resume upside momentum.
As the chart above shows, if closing breaks above 1.3525 occur, this could open the way for further strength toward 1.3658, the May 1st high. A break above that level may act as a possible catalyst for an extension of the recovery, potentially opening the way for moves toward 1.3733, the February 4th extreme.
Potential Support Levels:
While the first resistance level at 1.3525 continues to cap prices on a closing basis, downside pressure could emerge. If weakness is seen, support at 1.3303/06, the lower boundary of the current range, may need to be monitored. Closing breaks below this zone could shift risks toward further downside.
As the chart above shows, closing breaks below 1.3303/06 could indicate scope for deeper price declines toward 1.3160, the March 31st session low, potentially further if that level also gives way on a closing basis.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
US 500– Downside Pressure Easing as Fed Steps Into the SpotlightLast week, mid-week jitters regarding a potential escalation of the Iran conflict and a resumption of worries about overvalued AI stocks saw the US 500 index drop to 6-week lows at 7229 early on Thursday morning. At that point a drop of 5.2% from its record highs of 7625 set on June 2nd.
However, the sour mood didn’t last, with sentiment into the weekend receiving a major boost from President Trump’s decision to call off new missile strikes on Iran, announcing teams from Washington and Tehran were close to signing an interim peace deal. At the same time, technology stocks within the US 500 rebounded, encouraged by the success of Elon Musk’s SpaceX record breaking IPO, reviving short term trader enthusiasm for everything AI.
This positive reversal into the weekend, may have left traders in wait and see mode when looking forward to the week ahead, uncertain of whether the rebound may have the impetus to continue or not. In this regard, the joint announcement on Sunday from the US-Iran that they have reached an interim peace agreement that should allow the Strait of Hormuz to reopen on Friday (June 19th) has seen inflation concerns ease, helping the US 500 jump 1.3% to 7529 at the time of writing (0715 BST). In the short term, price action over the next 48 hours could be important in determining whether this is a, buy the rumour, sell the fact situation, or the start of a new up move to retest the early June record highs.
Looking further forward, there is the Federal Reserve (Fed) interest rate decision to consider on Wednesday at 1900 BST, followed by the press conference which starts at 1930 BST. This is the first decision presided over by new Fed Chair Kevin Warsh, and while no change to interest rates is expected, his comments on future rate moves, stubbornly high inflation and resilient economic growth could be crucially important to determining how the US 500 performs into the Friday close.
Technical Update: Limited Bounce or Upside Resumption?
The news from the US-Iran conflict over the weekend has, so far at least, produced a positive reaction in US equities, and the US 500 index has been able to extend its latest price strength that has been developing from last week’s low. As the chart below shows, this price strength has pushed the index back above what might have been an anticipated resistance level at 7479, highlighted by the Bollinger mid‑average.
The result of this latest move above the mid‑average raises the question of whether the market is now attempting to resume the broader uptrend that has been in place since the March 31st low at 6312, or whether this is simply a relief‑driven bounce following the possible end of the conflict, before weakness resumes.
With that in mind, being aware of potential key support and resistance levels that may help traders to gauge where the next directional themes could emerge, could prove to be useful.
Potential Support Levels:
With price action having just broken above the mid‑average, at 7479, this level may act as an initial support focus. However, as the chart below shows, the key support this week may be 7376, which is a level equal to half of the latest price strength. If tested, it may be closing breaks below 7376 that suggests risks are turning toward renewed weakness, even further downside momentum.
Closing breaks below 7376 could lead to a deeper retracement of the March 31st to June 2nd advance. This may see declines extend toward 7208, which is the 38.2% Fibonacci retracement and potentially even 7106, the April 29th session low.
Potential Resistance Levels:
While closes in price remain above the support at 7376, further price strength is a possibility. While this continues, traders may focus on 7625, the June 2nd all‑time high, as the next resistance level.
If 7625 is broken on a closing basis, risks may shift toward further upside momentum, with potential to test 7774, which is the 38.2% Fibonacci extension. Closes above 7774 if seen, might then be viewed as positive, suggesting scope toward 7867, the higher 61.8% extension.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
Gold: Extension or Rebound From New 2026 Lows?Yesterday, Gold fell 4.4% to its trade at its lowest level since November 2025 at 4067. It then extended that move this morning to touch a fresh low of 4024 before rebounding to trade back around current levels at 4090 (0630 BST).
This week, Gold prices have been undermined by rising inflation risks driven by fresh skirmishes in the Middle East between Israel/US and Iran which has cast major doubts over the ability of all sides to agree a peace deal and reopen the Strait of Hormuz. These inflation worries were further backed up by yesterday’s US CPI release which showed consumer prices in May accelerated at their fastest pace for more than three years (Bloomberg), reinforcing concerns amongst traders that the Federal Reserve could be forced to consider interest rate hikes later in the year. A move which as a rule weighs on Gold which pays no interest.
Looking forward, updates on the current situation in the Middle East could be critical in determining whether the down move for Gold extends, if the geo-political situation worsens, or a rebound in price is seen on the back of any de-escalation in the region. Today’s US PPI, or factory gate inflation release, at 1330 BST may also be important to traders. It is historically a more volatile number than yesterday’s CPI reading, and any surprise prints above or below expectations could have an outsized impact on Gold prices into the weekend.
Technical Update: Price weakness Sees 4099 Closing Breaks:
Since posting a high on May 29th at 4595, the price of Gold has seen a near 12.5% decline, as the longer term downtrend pattern has extended. As the chart below shows, this decline has seen prices touch 4024, which is the lowest trade since November 21st 2025. This price activity has also prompted closes below what might have been expected to be support at 4099, which is the March 23rd low.
Having already seen an extended phase of weakness, it might be argued that an over-extended downside price condition may currently be in place, although this of course doesn’t mean a reactive recovery could be on the cards. In this environment, being aware of possible support and resistance levels may be beneficial.
Potential Support Focus:
Having seen the latest price weakness close below the 4099 March 23rd low, traders may now be searching for the next key support levels. It is possible that this morning’s latest low at 4024 could be a short term support focus, meaning breaks below this level may be needed to suggest further declines.
As the chart above shows, if 4024 were to give way on a closing basis, risks could shift toward 3998, which is the November 18th low. Should that level also fail to hold declines, the focus could then move to 3887, which is the October 28th low, and possibly represents a deeper support area.
Potential Resistance Focus:
Of course, recovery attempts do remain a possibility, and if the recent low at 4024 does continue to hold, a reactive recovery move may be possible. If price strength is seen, traders might be monitoring how 4197 is defended on a closing basis. This level is equal to half of this week’s current sell-off range.
If prices were to close above resistance at 4197, it could suggest scope for further upside moves toward 4242, which is the 38.2% retracement of the May 29th to June 11th decline. Breaks above this level could open the way for tests of 4310, the higher 50% Fibonacci level.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
Germany 40 Index – Shifting Drivers, Iran Conflict to ECB Rate DVolatility in the Germany 40 index could remain elevated this week as while the Iran conflict, and more specifically the uneasy promises made by Israel and Iran to end missile attacks that initially sent the index down over 1.5% to an early low yesterday at 24335, currently loom large, the European Central Bank (ECB) interest rate decision on Thursday is another important event for traders to prepare, digest and then react to.
The ECB is expected by economists to be the first amongst the world’s biggest central banks to raise interest rates in an attempt to rein in rising inflation, driven higher by soaring energy costs. Policymakers are expected to deliver a 25 bps (0.25%) hike when the announcement is released at 1315 BST on Thursday. This is anticipated to be an insurance move to keep the ECB from falling behind the curve and having to hike rates at a fastest pace later in 2026 if price rises were to start to accelerate more aggressively.
While, the rate announcement could be an important volatility driver, what ECB President Lagarde says in the press conference (Commences 1345 BST) about future rate moves, inflation and Eurozone growth moving into the second half of 2026 could be just as critical. Madame Lagarde is expected to signal a further rate hike in September, and then another before the end of the year. Any changes to this timeline could introduce extra volatility to the Germany 40 index.
Technical Update: Correction Themes Gathering Pace?
Following the posting of the May 25th session high at 25449, the Germany 40 index has entered a corrective phase, with prices selling off as a reaction to the recent advance.
While it is impossible to know how far this type of move may extend, traders could now be focusing on Friday’s closing break below the Bollinger mid‑average (currently 24750), a level that might previously have been expected to act as support.
The question this week is whether this drop develops into a more extended phase of weakness, or if it proves to be a limited correction from which fresh strength can emerge. With the Iran conflict offering constant headline updates and then the ECB rate decision on Thursday, being aware of the next potential key support and resistance levels may prove useful for traders when managing their risk.
Possible Support Levels:
After last week’s closing break below the mid‑average, traders may now be anticipating the risk of further price weakness. As a result, attention could turn to the next potential support at 24335, which is Monday’s low and rally point. Confirmed closing breaks below this level could lead to additional downside pressure.
If this were to occur, closes below 24335 may shift risks toward a deeper decline, with the focus moving to 24072, which is the 38.2% Fibonacci retracement of the March 23rd to May 25th advance, and then potentially 23603/23648, a combination of the April 30th low and the 50% retracement level.
Potential Resistance Levels:
Following the latest phase of price weakness since the May 25th high, it may be the Fibonacci retracements of the latest decline that define potential resistance levels across the remainder of this week.
As the chart above shows, the 38.2% retracement at 24755 may be the first key level, and closing breaks above it could generate further upside momentum. This may lead to tests of 25020, which is equal to the 61.8% retracement, and if this level gives way, possibly a move back toward the 25449 May 25th high.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
US 100 Index – Where Next?We highlighted in our piece last week the potential importance of the outcome to Friday’s US payrolls release on sentiment towards stocks in the US 100 index, and it certainly didn’t disappoint! The index experienced its biggest 1 day drop in well over 1 year, slipping 5.16% to close the week at 28816. The strength of Friday’s jobs report, which saw Federal Reserve interest rate expectations shift higher, something that as a rule weighs on growth stocks in the US 100, coupled with disappointing results announced by Broadcom late on Wednesday, combined to undermine the incredible rally in AI stocks that had been driving the index to numerous record highs in recent weeks.
Now, with the index attempting a rebound so far this morning, currently trading 0.6% higher at 29010 at time of writing (0715 BST), traders may be scratching their heads and asking where next?
When sentiment turns and begins to reverse direction it can lead to a challenging trading environment. In this type of situation, it can be helpful to reassess the macro and technical backdrop.
On the macro side, the Iran conflict is well into its 4 month with concerns increasing that the current ceasefire agreement between all the parties could be under serious threat after Iran and Israel traded missile strikes over the weekend.
On the economic data front, the outcome of the latest US CPI (Wednesday, 1330 BST) and PPI (Thursday, 1330 BST) readings could have a crucial influence over the direction of market interest rate expectations leading up to the Federal Reserve interest rate decision on June 17th.
How all these events evolve across the week ahead could be very important for the direction of the US 100 index into Friday’s close.
Technical Update: Focus Shifts to Last Correction Low Support:
On Friday, the US 100 index showed the first sign of corrective themes emerging, with a 5.40% decline from the day’s high (30387) into the session low (28747). A move of this magnitude has not occurred since April 4th 2025, when the index fell by more than 6% in a single session.
Of course, this type of activity does not guarantee that further weakness may follow in the upcoming week. However, with uncertainty rising, traders may be reassessing the technical backdrop and attempting to identify potential key support and resistance levels to help gauge the next directional themes.
Potential Support Levels:
As the chart below shows, Friday’s decline produced the first close below the Bollinger mid‑average since April 3rd 2026, a level that might previously have been expected to act as support. This development may suggest increased risks of further downside momentum, as the market searches for the next support area.
Following a sequence of higher highs and higher lows, the basic definition of an uptrend, traders often monitor the last correction low. In the case of the US 100 index, 28596, a level equal to the May 19th session low and rally point, may be the initial focus this week.
Closing breaks below 28596, if seen, could lead to further declines, shifting attention to 27711, which is the 38.2% Fibonacci retracement of the March 31st to June 3rd advance, and if this level were to give way, potentially toward 26768, the 50% retracement.
Potential Resistance Levels:
After last week’s sharp sell‑off from the latest all‑time high of 30776 (June 3rd), Fibonacci retracements of the decline may be useful in identifying potential resistance levels if a recovery phase develops.
Using this tool, the 38.2% retracement at 29351 may be viewed as the first key resistance on any rebound is the US 100 from its current levels. If upside breaks above 29351 were to occur, focus could shift to 30006, which is the 61.8% level. If this level were broken on a closing basis, it could open the possibly for a move back toward 30776, the June 3rd all‑time high.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
USDJPY - Testing the Patience of Japanese AuthoritiesUSDJPY has been on the rise again this week, pushing this popular currency pair briefly back above 160.00 (160.09 high yesterday), a line that some traders view as a possible intervention warning trigger which has drawn official action from Japanese authorities to weaken the dollar (USD), and strengthen the Japanese Yen (JPY) in the past.
Only 6 weeks ago, on April 30th, USDJPY had just traded at a 2-year high of 160.73 before the Bank of Japan (BoJ) decided to step in, producing a sharp decline that led to a low of 155.03 being traded on May 6th. Since that drop, rising Federal Reserve interest rate expectations, US economic outperformance and dollar (USD) safe haven demand have seen USDJPY edge steadily higher in a slow painful squeeze for those caught short.
Now, with no sign yet of an agreement between the US-Iran to extend the ceasefire, let alone reach a peace deal to end the conflict, USDJPY is currently trading at 159.90 (0645 BST) with FX traders preparing to face the test of the latest US Non-farm payrolls release, tomorrow at 1330 BST.
This update on the current health of the US jobs market is expected to be a potential driver of FX volatility, as its outcome has major significance for the interest rate setting committee at the Federal Reserve, who next meet in just 12 days’ time on June 17th. In recent months, the headline jobs number and unemployment rate have remained remarkably resilient to the negative impact of the Iran conflict, inflation and a slowing global economy. A similar outcome on Friday could impact USDJPY prices dramatically, especially if the currency pair starts to gain momentum above 160.73 (April 30th high).
Technical Update: Heading Back to Recent Failure Highs:
While the Bank of Japan intervention in late April triggered a five‑session decline from the April 30th high at 160.73 into the May 6th low at 155.03, subsequent price action has produced a steady and consistent recovery. This rebound has now retraced a vast majority of the prior decline, bringing USDJPY back toward the 160.00 area, just below the zone where the BoJ previously intervened.
The chart above highlights how this type of intervention can impact USDJPY, and traders may understandably be cautious that a similar price action could occur again.
While there is no guarantee the BoJ will intervene if USDJPY moves above 160.00, the potential for increased volatility could keep traders on high alert over upcoming sessions. Good risk management and awareness of key support and resistance levels may help guide decision making regarding the next directional move.
Potential Resistance Levels:
In previous notes we highlighted the March 30th high at 160.46 as an important focus for traders. Although the pair printed a high of 160.73 on April 30th, the 160.46 level held on a closing basis, and it was from this area that the sharp decline began as BoJ intervention materialised. For this reason, the 160.46/160.73 band could be viewed as the first key resistance zone for USDJPY.
If USDJPY can achieve closing breaks above 160.46/160.73, it could open scope for further price strength. In that scenario, the focus may shift to 161.95, which is the July 2024 failure high, which also marks the highest USDJPY level since December 1986, nearly 40 years ago!
Potential Support Levels:
While the 160.46/160.73 resistance zone continues to cap USDJPY on a closing basis, attention may turn to potential support at 158.87, which is the current level of the rising Bollinger mid-average. A daily close below 158.87 may be required to tilt risks back toward renewed downside pressure.
A closing break below 158.87, while not an outright negative development, could expose the next support at 158.15, which is the 38.2% Fibonacci retracement of the latest May/June phase of strength and if this level were to give way, even 157.55, the 50% level.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted. US 100 Index – Can US Data Challenge the Rally?The US 100 index breezed through the psychological 30000 level on Wednesday last week as part of a run of 8 consecutive up days in a row as momentum and sentiment towards AI stocks combined to set several new record all-time highs, culminating in a close on Friday at 30340.
Despite a brief wobble to start June, after concerns rose amongst traders that US-Iran peace talks may have been stalled by Israel’s deeper incursion into Lebanon, the US 100 eventually extended the run to 9 up days in a row by posting a more subdued gain of 0.5% yesterday. This move was supported by comments from NVIDIA CEO Jensen Huang who dismissed concerns over the disruptive force of AI, while the world’s largest company also announced it was entering the PC market in a direct challenge to Intel and AMD, and will run Microsoft’s windows for Arm operating system (Bloomberg).
Looking forward, with the US 100 trading down 0.2% at 30425 at time of writing (0645 BST), the focus for traders may shift to updates on the health of the US economy, and more specifically on the resilience of the labour market. Tomorrow’s US ISM Services PMI survey will provide an important update on how service activity, which is the main driver of growth within the US economy, is performing in the face of rising inflation, while Friday’s crucial Non-farm payrolls release will highlight if the jobs market is maintaining its recent run of resilience in the face of mounting challenges created by the Iran conflict. All of which could impact the thinking of Federal Reserve policymakers in deciding their next move on interest rates when they meet on June 17th.
Technical Update: The Trend Continues …..
From the March 31st low of 22774 into yesterday’s new all‑time high at 30656, the US 100 index has now rallied more than 34.5% across 45 trading days. During this advance, only 11 sessions have closed lower than they opened the day, producing a red candle on the chart below. This continues to indicate that positive sentiment remains in place, with no sign yet of an extended phase of weakness developing.
Of course, a positive trend does not guarantee further gains.
Unexpected developments can still trigger a sharp correction or a shift in sentiment. With that in mind, ahead of this week’s US data releases it may remain useful for traders to identify key support and resistance levels that if broken, may guide the next directional themes.
Potential Resistance Levels:
While previous all‑time highs have not always acted as significant barriers during this latest US 100 rally, the most recent extreme could still attract attention. Yesterday’s peak of 30656 may act as the first resistance point, and how price behaves around this level on a closing basis could be important. A closing break above 30656 might lead to further attempts at price strength.
If upside breaks above 30656 were to materialise, the prevailing uptrend may continue to generate new highs. In that case, focus could shift to 30968, which is the 138.2% Fibonacci extension, and potentially even 31787, which is the 161.8% extension.
Potential Support Levels:
Given the scale of the recent rally, it could be argued that over‑extended upside conditions are present, which may lead to a period of weakness. The first key support stands at 30178, a level which is equal to half of the latest phase of price strength. If downside momentum begins to build, this could be the initial level traders focus on.
A closing break below 30178 could open scope for a deeper correction phase, exposing potential to test 29846, which is the 38.2% retracement, and then 29369, which is the deeper 61.8% retracement of the latest advance.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted. Oil (WTI) – Assessing Volatility Within a Choppy RangeOil (WTI) prices began the start of a new month of trading by rebounding strongly from a test of 6-week lows at 89.327 on Friday. This morning Oil spiked 2% to trade at 92.77 (045 BST) on disappointment that the US-Iran could not reach terms over the weekend to extend their existing ceasefire agreement for another 60 days and reopen the Strait of Hormuz, leaving the macro backdrop uncertain with the conflict now in its 14th week.
Further complicating the negotiations are an escalation of a war between Israel and Hezbollah, who is Iran’s strongest ally in the region. This has seen Israel launch a new ground assault moving deeper into Lebanon, which led Hezbollah to increase missile attacks on Israel’s north over the weekend. It is unclear whether either side would pause to allow a new agreement between US-Iran to be reached.
Looking forward, progress updates on whether these separate events in the Middle East are heading towards a positive or negative conclusion could be pivotal to the direction of Oil prices across the week.
Technical Update: Choppy Sideways Range Extends:
Between the March 9th high and March 10th low, an Oil (WTI) price sell-off of nearly 36% materialised, and while price moves have subsequently seen volatile swings, these have been confined by those March 9th and 10th extremes. As the chart below shows, even with sentiment still being driven by the constant flow of headlines on the US-Iran conflict, the market continues to trade in a broad sideways range, suggesting a closing breakout of either side may be necessary to reveal the next directional theme.
Given the wide range and elevated volatility, further price swings are still possible, even if they remain inside the broader consolidation. In this environment, tracking more intermediate support and resistance levels inside the wider range could help gauge the shorter‑term directional potential.
Potential Support Levels:
After the latest phase of weakness, traders may now be looking for support levels that could possibly stabilise price declines or even trigger recovery attempts. Following the recent falls, the focus for traders may be on 89.02, which is the April 20th low.
A closing break below 89.02 could increase downside pressure and expose the next support at 82.60, which is the April 17th low. Within the current daily structure, 82.60 appears to mark the lower boundary of the sideways range, making it a potentially important level to monitor for the longer‑term outlook.
Potential Resistance Levels:
If a more sustained price recovery is to develop, traders may be watching how the 93.61 level, which represents half of last week’s range, is defended on a closing basis. While not a guarantee of price strength, closing breaks above 93.61 could encourage further upside attempts.
As the chart above shows, breaks above 93.61 may shift attention toward higher resistance levels, possibly opening scope for tests of 96.98, the 38.2% Fibonacci retracement of the May decline, and potentially then the 50% retracement at 99.29.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
Gold – Feeling the Strain of Higher Inflation ExpectationsDespite headlines to the contrary at varying times over the last month, the US and Iran have currently failed to reach a draft peace agreement. This has kept the Strait of Hormuz closed to crucial energy shipments from the Middle East region for 13 weeks, which has ensured oil prices remain at elevated levels, far beyond what was envisioned when the conflict started in late February.
This situation has helped to fuel a rising belief amongst investors that global central banks led by the Federal Reserve could be forced to keep interest rates higher for a longer period to contain surging energy costs that are only just starting to feed into higher consumer prices. The current evolving inflation/interest rate environment contrasts dramatically to the start of 2026 when inflation was seen as largely contained and 3 interest rate cuts were expected from the Fed across the year.
This shift in the macro backdrop may have been a key reason why the Gold rally from the March 23rd low at 4099, stalled at 4889 in April, and then again at 4774 in mid-May, as higher interest rates can have a negative impact on Gold and other precious metals that do not bear interest or pay a dividend.
Now, with both sides exchanging missile strikes this week, threatening the fragile ceasefire that has been in place since the Middle of April, Gold prices have dropped over 4.5% from a high of 4580 on Tuesday down to a low of 4366 earlier this morning, before recovering slightly back to current levels around 4383 (0700 BST).
Looking forward, traders may be waiting for the next series of updates on the status of peace discussions, but they could also be preparing for the latest US PCE Index release, which is due later today at 1330 BST. This is the Fed’s preferred gauge of inflation and could shape decision making amongst policymakers regarding future interest rate moves, starting with next month’s announcement on June 17th.
Technical Update: Can the Latest Downside Extend Further?
Shifting sentiment has seen selling pressure increase for Gold, culminating in a fall from the April 17th high at 4889 to this morning’s low at 4366 (as of 0700 BST), a decline of over 10.5%. With this latest fall marking the lowest trade since March 26th, 2026, certain traders may argue that a pattern of lower highs and lower lows could now be in place, a structure often associated with a downtrend.
While this type of pattern does not guarantee that more price weakness may follow, being aware of key support and resistance levels can help to highlight important points from which the next directional move could materialise.
Potential Support Focus:
The latest decline has seen Gold prices fall below 4391, which is the 61.8% Fibonacci retracement of the March 23rd to April 17th rally. This level may need to be watched closely on a closing basis today, as confirmed breaks lower could open the door to further downside.
As the chart above shows, if 4391 does give way on a closing basis, risks might shift toward tests of support at 4306, which is the March 24th low. Should that level also be broken, focus could then move to 4099, which is the March 23rd low, and could represent a deeper support area.
Potential Resistance Focus:
Upside recovery attempts remain a possibility, but for these to develop, Gold prices may need to achieve a closing break back above the first potential resistance at 4474, which is equal to half this week’s current range. A close above this level could open the way for moves to 4531(38.2% of the May sell-off range), then 4583, the current level of the falling Bollinger mid‑average.
If prices were to close above the 4531/4583 resistance zone, it could open scope toward 4618 (61.8% retracement), and if this were to also give way, it might then lead to tests of 4774 which is the May 12th high.
The material provided here has not been prepared accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
