US Dollar/Canadian Dollar breaks above 0.5 Arc – Potential advance toward 1.4124

Mohamad Gharib

USD/CAD: Arc cycle analysis™

Overview: Based on Arc Cycle Analysis applied to the 2h chart, U.S. Dollar / Canadian Dollar has broken above the 0.5 Resistance Arc within the current Arc Cycle. The breakout confirms a bullish shift in price structure and opens the potential for continued movement toward the next Resistance Arc.

Market outlook

Price has broken above the 0.5 Resistance Arc, confirming a bullish breakout within the current Arc Cycle.

A sustained breakout above the Resistance Arc supports continued movement toward the next Resistance Arc at 1.4124 (0.618 Target Arc). Conversely, a sustained 2h close back below the broken Resistance Arc at 1.3980 would weaken the breakout scenario and could shift the outlook toward the previous Support Arc.

Author

Mohamad Gharib

AUD/USD picks up bids above 0.7100 after RBA-speak

AUD/USD picks up bids above 0.7100 in the Asian session on Tuesday, following hawkish comments from RBA Assistant Governor Sarah Hunter and Governor Michele Bullock. However, escalating tensions in the Middle East and the Fed's hawkish outlook remain supportive of the bullish US Dollar undertone, which could limit the pair. The crucial Trump-Xi summit is later this week and remains in focus.

USD/JPY holds small gains near 157.50 as JPY intervention risks loom

USD/JPY posts modest gains while trading near 157.50 in the Asian session on Tuesday as intervention fears help limit losses for the Japanese Yen. However, the BoJ's dovish rate hike to a 31-year high keeps JPY bulls on the back foot. Meanwhile, the US Dollar retains a bullish undertone amid the Fed's hawkish outlook and escalating Middle East tensions, providing tailwinds for the pair.

Gold drops to three-day low, eyes $4,300 as hawkish Fed and Iran risks underpin USD

Gold turns lower for the second consecutive day following a modest intraday uptick, dropping to the $4,315 region, or a three-day low heading into the European session on Tuesday. The US Federal Reserve's hawkish outlook is seen as a key factor driving flows away from the non-yielding yellow metal.

Bitcoin pauses rally as profit-taking reaches yearly high

Bitcoin takes a breather, facing a pullback, trading below $85,500 on Tuesday after surging 6.7% the previous day. Strong institutional demand supports the bullish price action, with spot Bitcoin Exchange Traded Funds recording nearly $1 billion in inflows on Monday and Strategy adding 950 BTC to its treasury.

Energy and risk markets remain in the driver’s seat

US stock markets rallied up 2.26% (Nasdaq) yesterday with AI/tech names leading the advance. The Nasdaq even tested the all-time high reached early June. The likes of the S&P 500 and EuroStoxx50 recovered up to 1.5%. Positive risk vibes and lower energy prices supported consolidation on bond markets following the past month’s heavy losses. European yield curves bull steepened.

BoJ Recap: Not as hawkish as expected

The Bank of Japan (BoJ) raised its short-term interest-rate target to 1.25% from 1.00% in a 7-2 vote, marking another step in the normalisation of monetary policy and widely matching what everyone has been expecting for weeks.