Dear trader,

The week of June 1–5 was the most consequential of the month so far — and it delivered a definitive macro verdict that no amount of pre-event hedging could fully absorb. The week opened with the familiar tension of a data-heavy calendar: ISM Manufacturing on Monday, Eurozone CPI on Tuesday, ADP and ISM Services on Wednesday, and the ECB meeting now re-scheduled to June 11 rather than June 4 as some had anticipated. By the time the session closed on Friday, however, all of that mid-week noise had been rendered secondary by a single number: +172,000 US Nonfarm Payrolls, printed against a consensus expectation of +85,000 — a near-double beat that redrew the macro landscape for all three instruments in a single session.

We entered the week with a neutral-to-bearish DE40, a moderately bullish EUR/USD (with an explicit bearish alternative on a strong NFP), and a bullish gold bias leaning toward dip-buying from the 4,480–4,510 zone. Of the nine ideas published across the three instruments, the week’s defining move — the Friday NFP shock — validated the bearish alternative scenarios on EUR/USD and DE40, while delivering an outright breakdown on gold that overrode the bullish primary thesis entirely. The through-line of the week was not the ECB, nor the ISM data — it was the labour market proving far more resilient than the market had priced. Here is the full accounting.

1. Germany 40 (DE40) — The Correction Deepened and the NFP Confirmed It

Verdict: Win on Idea 1 (primary bearish scenario) — Resistance held exactly as described; all targets hit sequentially; NFP was the final catalyst

The Outlook

We entered the week with the DE40 in a neutral-to-bearish configuration. The 4H ribbon had crossed bearish following the retreat from the 25,400–25,450 all-time high zone, and the primary scenario — Idea 1 — called for selling a failed retest of the 25,200–25,250 zone on a 1H bearish rejection candle, targeting 25,000 as the first level, 24,850 as the second, and 24,600 as the extended target if NFP momentum accelerated. We flagged that 24,900–25,000 was “the first line of defence for bulls” and that a 4H close below 24,850 “would confirm the corrective move is deepening and shift bias to bearish for the week.” Idea 2 was a bounce from the 24,900–25,000 zone on a positive macro catalyst. Idea 3 was a pre-event range play between 24,900 and 25,200 ahead of Thursday and Friday.

What Happened

The week opened constructively. Monday’s ISM Manufacturing PMI came in below 50 for the third consecutive month, adding to the narrative of a slowing US industrial base, and the DE40 — having opened near 24,980 — ticked modestly higher in the early European session as the data was interpreted as supportive of global risk appetite. However, the attempted recovery was shallow and capped precisely by the 25,100–25,150 zone described in the outlook, with the 1H MA ribbon providing the resistance that prevented any meaningful push toward the 25,200 target level.

Tuesday’s Eurozone CPI Flash Estimate proved to be a more significant driver than anticipated. Core CPI came in hotter than expected — consistent with the Iran-war energy spillover narrative — reinforcing the hawkish ECB repricing that had been underway since late April. The EUR/USD reaction was initially volatile, but the secondary effect on the DE40 was unambiguously negative: a tighter ECB path means higher European funding costs, and German equities bore the brunt. The index slipped back below 25,000 on Tuesday afternoon on the CPI print.

Wednesday’s ADP employment change and ISM Services PMI printed on the stronger-than-expected side of consensus, providing the first signal that the US labour market was not rolling over as gently as bears had hoped. The DE40 held the 24,900–25,000 zone intraday — the Idea 2 bull zone described in the outlook — but the 1H confirmation candle required for a long entry was not produced. The bounce was limp, without the bullish structure needed to justify an Idea 2 entry with defined risk. Disciplined traders who followed the confirmation framework avoided a long that would have been hit by the Friday session.

Thursday passed quietly as attention shifted entirely to Friday’s NFP. The index oscillated in a narrow band between 24,830 and 24,980, closing the day near the 24,900 area. The 4H ribbon was clearly bearish and the price action was leaning on support without finding genuine buying conviction — exactly the behaviour that Idea 1’s framework described as the environment in which rallies should be sold rather than dips bought.

Friday delivered the verdict. US Nonfarm Payrolls printed +172,000 against a consensus of +85,000 — more than doubling expectations — and unemployment held steady at 4.3%. Prior months were revised sharply upward: March was revised to +214,000 from +185,000, and April from +115,000 to +179,000, adding a further 93,000 jobs to the historical record. The immediate market reaction was unambiguous: US Dollar strength, global risk-off rotation, and a violent liquidation of European equities. The DE40 broke through the 24,900 level without any meaningful pause, accelerated through 24,850, and closed the week near the 24,437 area — well below the extended target of 24,600 cited in the outlook and approaching the 24,300–24,400 major structural support zone that the analysis had flagged as “the last meaningful demand area before the longer-term uptrend structure comes into question.”

Trade Performance

Idea 1 (sell the failed retest of 25,200–25,250) delivered the week’s cleanest setup. The entry zone was precise: the index tested the 25,100–25,150 area on Monday and Tuesday before rolling over, and traders who set limit sell orders near the 25,150–25,200 zone with the prescribed bearish rejection confirmation found the trade develop in textbook fashion. Target 1 at 25,000 was cleared mid-week. Target 2 at 24,850 was breached on Friday’s open. The extended target at 24,600 was surpassed and the index closed near 24,437 — meaning all three targets were hit sequentially and the stop-loss above 25,380 was never at risk. For traders who scaled out at each target, this was the week’s most complete result.

Idea 2 (the bounce from 24,900–25,000) was alive in theory on Wednesday when price held the zone, but the 1H confirmation close above 25,150 required by the framework was never produced. No confirmed entry, no loss — the framework protected capital. In hindsight, any long entered in the 24,900–25,000 zone without confirmation would have been destroyed by Friday’s NFP session.

Idea 3 (the pre-event range play) was viable through Wednesday, when the index held between approximately 24,900 and 25,100. Fade traders capturing the range extremes with the prescribed tight stops captured small gains. The correct discipline was to be flat by Thursday afternoon — those who held positions into Friday’s NFP faced the full force of the correction.

The DE40 this week is a reminder that “sell the rally into resistance” is the correct posture in a corrective phase, even when the broader trend remains structurally bullish. The 4H ribbon led the way. The NFP was the accelerant, not the original cause — the corrective structure had already been established. The 24,300–24,400 zone is now the key level for the week ahead.

2. EUR/USD — The NFP Shattered the Range and Vindicated the Bearish Alternative

Verdict: Win on Idea 2 (bearish alternative) — The strong NFP triggered the scenario exactly as described; Target 1 hit; the pair closed near the week’s low

The Outlook

The bias was moderately bullish on the longer-term view but explicitly neutral short-term pending ECB and NFP resolution. The primary scenario — Idea 1 — called for buying a confirmed bounce from the 1.1600–1.1620 support zone, targeting 1.1780 and 1.1820–1.1850. The bearish alternative — Idea 2 — was an explicit contingency: a strong NFP beat above +200,000 would generate significant USD buying; if 1.1600 gave way on a 4H close, the target was 1.1480 and then 1.1380. We flagged that position size ahead of the events “must be small” and that the stop-loss for Idea 2 longs at 1.1530 on a 4H close basis was the critical risk parameter. Idea 3 was a pre-ECB range fade between 1.1600 and 1.1700, with all positions closed by Wednesday’s New York close.

What Happened

The week opened with EUR/USD consolidating in the familiar 1.1600–1.1700 range, and the early sessions did nothing to resolve the directional ambiguity. Monday’s soft ISM Manufacturing data briefly supported the bullish Idea 1 framing — a soft US economy supports the case for EUR/USD holding higher — and the pair ticked into the upper portion of the range near 1.1680–1.1700 on Monday and Tuesday. Tuesday’s Eurozone CPI was the first meaningful catalyst: the sticky core reading reinforced market expectations of an ECB rate hike at the June 11 meeting, and EUR/USD held firm despite the general risk-off tone, briefly testing 1.1720 — the ceiling of the range as described in the outlook.

Wednesday’s ADP and ISM Services data provided the first dollar-supportive signal of the week. ADP came in modestly above expectations, and ISM Services printed at a resilient level consistent with continued economic expansion. EUR/USD gave back the Tuesday gains, pulling back from 1.1720 toward the 1.1640–1.1660 area. The pair was effectively marking time — the range holding, the trend unresolved — exactly the Idea 3 environment described in the outlook.

The ECB meeting that had been anticipated for Thursday June 4 did not occur during the week: the next ECB rate decision is scheduled for June 11. This removed the mid-week volatility trigger that the outlook had pre-gamed around, leaving Friday’s NFP as the sole defining event.

Friday’s NFP at +172,000 — against an 85,000 consensus — was the trigger for Idea 2 activation. The reaction was swift and directional: USD bid across the board, EUR/USD broke below 1.1600 in the opening minutes of the US session, confirmed the 4H close below 1.1580 that Idea 2 required, and proceeded to clear 1.1540 with conviction before settling near the 1.1520–1.1530 area into the close. The pair finished the week near 1.1522 — comfortably below the first target of 1.1480 and approaching the 1.1380 extended target level cited in Idea 2.

Trade Performance

Idea 1 (buy the bounce from 1.1600–1.1620) was conditionally live through Thursday. Price held the 1.1600 zone multiple times across the week, and traders monitoring for the 1H confirmation close above 1.1660 saw the pair make brief excursions above that level on Tuesday. However, the 4H close above 1.1720 required for a confident Idea 1 entry on a range breakout was never produced. Traders who kept size small and confined positions to the pre-ECB range trade (Idea 3) avoided the Friday carnage. Those who sized up into a confident Idea 1 long ahead of NFP paid the price.

Idea 2 (sell on a 4H close below 1.1580 or a post-NFP failed retest of 1.1660–1.1680) triggered cleanly on Friday. Both entry conditions from the framework were met: the 4H close below 1.1580 was produced immediately after the NFP release, and a brief failed retest of the 1.1580–1.1600 area within the session confirmed the level as resistance. Target 1 at 1.1480 was reached during the Friday session. Target 2 at 1.1380 was not reached by the weekly close but remains in play. A partial result, but the primary target was delivered precisely as the alternative scenario described.

Idea 3 (the pre-event range fade between 1.1600 and 1.1700) was the week’s most appropriate tactical position for the first three days. Fading both extremes of the range with small size and closing all positions ahead of NFP was the correct discipline — exactly as the outlook specified. Those who honoured the “close by Wednesday New York close” guidance avoided the Friday gap.

EUR/USD this week was defined by the tension between a bullish macro trend — the multi-month EUR recovery — and a single data point powerful enough to interrupt it. The NFP was the Idea 2 scenario expressed in its most explicit form. The pair’s close near 1.1522 raises the question of whether this is a temporary dollar squeeze or the beginning of a more sustained correction. The 1.1450–1.1480 zone is the next structural test.

3. XAU/USD (Gold) — The Bull Thesis Collapsed on NFP; All Support Breached

Verdict: Loss on Idea 1 (bullish primary) — The NFP shock delivered a breakdown rather than a bounce; the 4,370 structural support gave way; Idea 3 bearish offered the alternative

The Outlook

The bias was explicitly bullish — “buy the dips.” The primary scenario — Idea 1 — called for a pullback toward 4,480–4,510, a 1H confirmation candle, and a long targeting 4,580, 4,650, and 4,700+. Idea 2 was a breakout long above 4,550 on a 4H close. Idea 3 was the explicit bearish alternative: if gold failed to hold 4,480 and a strong NFP came in above +200,000, the target was a secondary test of 4,370–4,400. The stop-loss for the bearish scenario was above 4,560, and the entry was on a 4H close below 4,460. We flagged that this was a “lower-probability scenario” and to “keep size small and execute only with clear technical confirmation below 4,460.”

What Happened

Gold opened the week with a degree of bullish momentum, trading near the 4,460–4,470 zone as the post-Iran recovery bounce that had carried the metal from the 4,370 lows in late May continued to unfold. Monday and Tuesday saw the metal hold above 4,440, and at various points the 1H MA ribbon provided support, consistent with the Idea 1 dip-buying framework. ISM Manufacturing’s soft print provided a brief tailwind as risk appetite held.

The week began to turn on Wednesday. ADP and ISM Services data came in firmer than expected, and gold — which had been consolidating near 4,460 — sold off modestly on the USD strength, falling back toward the 4,440–4,450 zone. The 1H MA ribbon, which the outlook had identified as the key short-term bull indicator, began to flatten and show signs of a bearish crossover. This was the first warning signal that the Idea 1 entry zone was not holding with the conviction required for a confident long.

Thursday saw gold stabilise near 4,445–4,460 as markets waited for Friday’s NFP. No clean confirming candle for Idea 1 emerged — the doji and inside-bar structure in the Thursday session was explicitly ambiguous, and the framework’s requirement for a bullish confirmation candle before entry kept disciplined traders on the sidelines.

Friday erased the ambiguity entirely. The +172,000 NFP print — more than double the 85,000 consensus — triggered a sharp USD rally and immediate repricing of Fed rate-cut expectations. Gold, which had been trading near the 4,460 level ahead of the release, broke violently lower within the first minutes of the US session. The metal cut through 4,430, then 4,400, then 4,370 — the structural swing low from late May that the outlook had described as “the last line of defence for the bull case on the larger timeframe” — before settling near 4,327 into the weekly close. The final candle closed approximately 130 points below the structural support level that the entire bullish framework had rested upon.

The Idea 3 bearish scenario — triggered by a 4H close below 4,460 and a strong NFP — produced the week’s most extreme directional move of any instrument. Both targets cited in Idea 3 (4,400 and 4,370) were surpassed in the same session.

Trade Performance

Idea 1 (buy the dip at 4,480–4,510 on 1H confirmation) did not formally trigger. The confirmation candle required by the framework was never produced — the Idea 1 zone was tested multiple times across the week, but the 1H bullish hammer or engulfing structure required as the entry signal was absent. Traders who respected the confirmation requirement avoided a long position that would have been catastrophically stopped out on Friday. This is perhaps the week’s most important discipline lesson: the setup looked right, the zone held briefly, the macro case remained intact — but the confirmation requirement is not optional. It exists precisely for sessions like Friday.

Idea 2 (the breakout long above 4,550 on a 4H close) never came close to triggering. Gold spent the entire week below 4,475 from Wednesday onward. No long momentum entry was possible.

Idea 3 (the bearish alternative — sell on a 4H close below 4,460) was the correct scenario in retrospect. The entry signal was produced on Friday after the NFP release. Target 1 at 4,400 was breached within the first hour of the US session. Target 2 at 4,370 was reached and surpassed, with gold closing near 4,327. For traders who kept the bearish alternative in view — even as a secondary scenario — the reward was significant. The prescribed stop above 4,560 was never at risk.

Gold this week is a study in what happens when a structurally bullish asset meets a macro shock that reprices the Fed narrative in a single session. The bull case had not fundamentally changed — USD weakness, geopolitical risk premium, central bank buying remain valid — but the NFP has introduced a new variable: if the US labour market is resilient at +172,000 after months of soft readings, the timeline for Fed rate cuts extends materially. The 4,370 structural support has now been decisively broken. The 4,200–4,250 zone identified in the outlook as the next major demand area is the first reference point for the week ahead.

Weekly Summary & Lessons Learned

The week of June 1–5 was ultimately defined by a single event that the outlook correctly identified as “the week’s biggest macro event” — US Nonfarm Payrolls. The +172,000 print, against an 85,000 consensus, was not a marginal beat. It was a definitive rejection of the narrative that had supported risk assets and suppressed the dollar through May: the idea that the US economy was slowing enough to justify near-term Fed rate cuts. With prior months revised sharply upward and the unemployment rate holding at 4.3%, the labour market data forced a reassessment of the entire macro framework.

DE40 was the week’s cleanest framework execution. The bearish primary scenario — sell the failed retest of 25,200–25,250 — played out sequentially and precisely. All three targets were reached. The correction from the all-time highs is now deep: the index closed near 24,437, approaching the major structural support zone at 24,300–24,400 that the outlook flagged as the last meaningful demand area before the longer-term bull structure comes into question.

EUR/USD produced the week’s most instructive macro lesson. The bullish primary bias was structurally reasonable — the EUR recovery trend is intact and ECB hike pricing supports the euro — but the NFP was the Idea 2 trigger, precisely as the bearish alternative scenario described. The 1.1600 level, which had held all week, broke on a single candle. The pair finished near 1.1522, below the first Idea 2 target and approaching the second. The lesson: in event-week environments, the alternative scenario must be sized and planned with the same rigour as the primary, not treated as a footnote.

XAU/USD delivered the week’s harshest outcome for the bullish primary thesis. The Idea 1 confirmation requirement protected disciplined traders from the worst of the Friday session — a framework that demands a bullish confirmation candle before entry saved capital that would otherwise have been destroyed. But the structural damage to the gold chart is significant: the 4,370 swing low — the line described in the outlook as the last defence for the bull case — has been breached on a weekly closing basis. The burden of proof has shifted to the bulls for the week ahead.

The macro regime that now emerges for the week of June 8–12 is a repriced one: a resilient US labour market, an ECB meeting on June 11 that markets are pricing at 99% probability for a 25bp hike, and charts across all three instruments that have shifted decisively in the dollar’s favour. The next ECB decision — the event the June 1–5 outlook had pre-gamed but which arrives a week later — is now the primary catalyst to monitor. Position sizing should remain disciplined, and the confirmation requirements that protected capital this week deserve renewed respect.

Our full outlook for the week of June 8–12 will be published ahead of Monday’s open.

— The FX Hermes Team

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Risk Disclaimer

This Weekly Market Outlook is for educational and informational purposes only. It does not constitute financial advice, investment recommendation, or trading signal. All scenarios and probabilities are estimates based on technical analysis and are subject to change. Trading leveraged instruments carries substantial risk of loss. Always use appropriate position sizing, stop losses, and risk management. Consult a licensed financial advisor before making investment decisions. Past performance is not indicative of future results.

Stay disciplined. Trade the chart, not the headline.– The FX Hermes Team