The US dollar is currently strong against major currencies. The focus this week is on US inflation data, specifically the CPI report due tomorrow, which is expected to influence the Federal Reserve’s stance on interest rate cuts. The Bank of England (BoE) recently delivered a hawkish rate cut, raising inflation concerns. Technically, GBPUSD is trading near a major downward trendline, with buyers and sellers vying for control. Upcoming economic data releases from the UK and the US are expected to provide further direction.

For GBPUSD, traders should closely monitor the US CPI data as a hot reading could strengthen the dollar and pressure the pair downwards. A weaker CPI may further embolden the dovish repricing and soften the dollar. UK GDP data may also be key. Technically, the battle at the downward trendline suggests potential for a breakout or a reversal; monitor the trendline support and resistance levels in Article 4. Focus should also be on the Fedspeak this week.

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The USD is showing mixed performance. It’s at the highs against most major currencies but relatively little changed overall. EURUSD is testing key support levels, while USDCHF has broken higher. Markets are also awaiting US inflation data which is expected to set the tone for the week. Concerns arise from a potential slowdown in the U.S. labor market and dovish signals from Federal Reserve officials, contrasting with positive data flow from Australia and the UK.

These findings suggest a period of uncertainty for the USD. The technical analysis indicates potential for both gains and losses depending on key support and resistance levels. The upcoming US inflation data will be crucial in determining the USD’s direction. The conflicting signals from economic data and Federal Reserve policy indicate a volatile environment, requiring careful monitoring and risk management for USD trading and investment.

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The EURUSD is facing downward pressure, testing key support levels around 1.16098, with a break below potentially leading to further declines towards 1.15648. The dollar is at the highs to start the day vs most of the major currencies. Broader market sentiment is cautious ahead of the US CPI report, which is expected to significantly influence market direction. The articles reference key technical levels for EURUSD, USDJPY and GBPUSD while outlining the bias, targets and risks for each. Other global economic factors include upcoming data releases from Australia, the UK, and potential shifts in monetary policy.

For EURUSD traders, monitoring the 1.16098 level is crucial. A sustained break below it could signal a further sell-off, presenting shorting opportunities. Conversely, holding above this level might offer a chance for a rebound. The upcoming US CPI data is a major catalyst and could trigger significant volatility. Traders should also be aware of the 100-hour moving average at 1.16312. Remaining below this level keeps the bearish tone intact. Overall, a defensive approach is warranted until the CPI data provides clearer direction.

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Gold prices are easing as traders await clarification on potential US tariffs. Last week saw a surge in COMEX gold futures due to rumors of tariffs, but the spot market remained calmer. The spread between COMEX and LME futures has narrowed, indicating the initial surge is fading. The market awaits confirmation from the White House regarding the tariffs.

For gold traders and investors, the near-term outlook is uncertain. A break below the 200-hour moving average ($3,352) could signal a bearish trend, while holding above it maintains a neutral bias. The larger trend shows gold consolidating since May, and the next significant move hinges on breaking this pattern. A key level to watch on the downside is the 100-day moving average at $3,292, a level not firmly broken since October 2023. Monitoring US tariff announcements is crucial.

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