market outlook

Market Summary and Key Outlook (as of June 02, 2025)

Josh

— 2 min read

Global Financial Condition Highlights

  • Trade‐policy uncertainty remains the dominant theme:
    • A U.S. court briefly blocked, then reinstated, Trump’s tariff authority.
    • New U.S. tech sanctions on China and doubled steel/aluminum levies (to 50% from June 4) keep risk elevated.
  • Risk sentiment is mixed—initial risk-on from blocked tariffs has given way to renewed caution after reinstatement and fresh sanctions.
  • Seasonal window favors equities and high-beta FX (late May–mid-July historically strong for S&P 500 and AUDUSD).

Currencies & Forex Markets

  • USD: Bearish vs EUR, CHF, JPY
    Tariff escalations & rising policy risk undermine the dollar; safe-haven status is currently muted in risk-on phases.
  • EURUSD: Bullish
    Long from ~1.1341 targeting ~1.1595; supported by USD softness and slowing U.S. inflation expectations.
  • AUDUSD: Bullish
    Long from ~0.6474, TP ~0.6680; benefits from risk-on flows and strong seasonal bias through June 8.
  • NZDUSD: Bullish
    Similar high-beta profile to AUD; consider partial allocation or staggered entries.
  • GBPJPY: Neutral–Mixed
    Short-term buy zones near 194.00 conflicted by broader JPY strength (BOJ hiking path, safe haven).
  • JPY: Bullish
    BoJ rate normalization, MOF bond-issuance trim and safe-haven flows have driven a ~12% yen gain in 2025.
  • CHF: Bullish in risk-off, underperforms in risk-on
    Safe haven flows bid CHF when risk aversion spikes; underperforms high-beta FX during rallies.
  • CHFJPY: Bearish
    Short from 173.44, targeting 166.00; aligns with broader yen outperformance vs CHF when risk aversion rises.

Major Asset & Equity Outlooks

  • Gold (XAUUSD): Bullish
    Pending long order at 3,327 with TP 3,500 and SL 3,245; supported by renewed tariff/geopolitical risks and a weakening USD. Short-term dip toward ~3,235–3,245 expected as a tactical entry.
  • Equities (S&P 500): Bullish
    Seasonal strength from May 24–July 23 (14 of 15 years positive, +5.0% avg.). Month-end flows and trade-talk headlines create volatility but favor the upside.
  • Cryptocurrencies (Bitcoin, Solana): Bullish medium term
    Tariff uncertainty and “sell America” flows may drive capital into Bitcoin (long from ~$91 200) and Solana (long from ~$243), viewed as alternative safe havens.

Summary

  • Trade tensions—recently oscillating between de-escalation and fresh sanctions—are driving USD weakness, gold strength and bouts of equity volatility.
  • Seasonal patterns support a continuation of the risk-on rally in equities and commodity-linked FX (AUD, NZD).
  • Maintain current longs in EURUSD, AUDUSD and Gold with disciplined stop-loss levels; monitor upcoming Trump announcements and U.S. macro datapoints for triggers.

Overall: Trade‐policy headlines and seasonal flows favor risk assets and high-beta currencies, while safe havens (JPY, CHF, Gold) remain well supported on bouts of policy uncertainty.

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