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EUR/USD — Breakout Revives Bullish Bias

Key Highlights

• EUR/USD snaps four-day losing streak
• Fed cut + Powell’s tone triggers sharp USD selloff
• Markets dismiss dot plot, price deeper 2026 easing
• Pair retests 1.1700 after reclaiming key MAs

Market Overview

EUR/USD surged to 1.1698 on Wednesday after the Fed delivered a decisively dovish policy message despite a divided vote. While the 25 bps cut was fully priced in, the market reacted strongly to Powell’s explicit rejection of future rate hikes and his emphasis on labor market risks.

The US Dollar Index collapsed toward 98.50, pressured by falling Treasury yields and Powell’s admission that payrolls may have been overstated by roughly 60k per month, implying negative underlying job growth. Traders interpreted this as a validation of deeper easing in 2026, regardless of the Fed’s official projection of only one cut.

The euro additionally benefited from USD-driven flows, with Europe’s calendar quiet ahead of Germany’s final CPI numbers.

Technical Outlook (H4)

• Stochastic rises toward overbought → strong upside momentum
• Price breaks firmly above 20-period MA → trend bias shifts bullish
• Structure now supports continuation toward upper resistance band

Key Levels

Resistance	Support
1.1758	1.1651
1.1812	1.1597

Fremora Takeaway

Momentum favors the euro after a clean Fed-driven breakout.
Holding above 1.1650 validates the move.
A break above 1.1758 opens path toward 1.1812.

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GOLD — Fed Dovishness Rekindles Upside Momentum

Key Highlights

• Gold climbs toward $4,240 on weaker USD
• Powell rules out rate hikes → bullish backdrop
• Restart of balance sheet expansion adds support
• Market positions for deeper 2026 easing than Fed projects

Market Overview

Gold advanced to $4,225.30 following the Fed meeting as markets reacted to Powell’s unexpectedly dovish tone. The central bank’s decision to restart T-bill purchases added a liquidity tailwind that typically supports precious metals.

Powell’s acknowledgment that employment data has likely overstated payroll gains for months — suggesting negative real job growth — reinforced expectations that the Fed will remain accommodative into 2026. Coupled with his argument that inflation outside tariffs is already in the “low 2s,” gold found strong macro support.

Despite rising short-term enthusiasm, traders remain focused on whether gold can sustain momentum into the $4,270–$4,340 zone, where upside breakouts have previously stalled.

Technical Outlook (H4)

• Stochastic approaches overbought → strong buying interest
• Price holds above the 20 MA → short-term structure stays bullish
• Pattern suggests potential continuation if resistance breaks

Key Levels

Resistance	Support
4274.57	4145.11
4341.25	4082.07

Fremora Takeaway

Macro backdrop favors bulls.
Staying above $4,200 keeps pressure toward $4,274.
Fed liquidity + weaker USD remain core drivers.

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GBP/USD — Sterling Extends Breakout Toward 1.3400

Key Highlights

• GBP/USD rallies sharply on USD selloff
• Fed’s dovish tilt amplifies BoE–Fed policy divergence
• Powell highlights negative job growth risk → bearish for USD
• Sterling reclaims entire previous week’s decline

Market Overview

GBP/USD rallied to 1.3384 as the Fed’s dovish tone erased recent USD strength. Powell’s messaging — particularly the categorical dismissal of rate hikes — triggered a broad repricing across FX, with sterling among the strongest beneficiaries.

The BoE’s relatively steady stance compared to the Fed’s pivot amplifies the policy divergence. UK housing data and commentary from BoE’s Kroszner are secondary catalysts today but unlikely to override USD-driven flows.

Market sentiment now skews toward continued GBP outperformance unless the Fed’s projections regain credibility.

Technical Outlook (H4)

• Stochastic in overbought area → strong trend, stretched conditions
• Price rides firmly above 20 MA → buyers remain in control
• Breakout structure targets the mid-1.34s

Key Levels

Resistance	Support
1.3450	1.3320
1.3522	1.3258

Fremora Takeaway

Momentum-backed breakout.
If bulls hold 1.3320, next target is 1.3450.
Trend remains favorable while USD stays pressured post-Fed.