Track market-moving stories before they get noisy

Pound-Euro could remain under pressure if ECB minutes reinforce September rate hike bets, while Sterling lacks fresh domestic catalysts. The Pound to Euro (GBP/EUR) exchange rate trended broadly lower last week as UK economic data failed to build confidence amongst GBP investors.

At the time of writing, the GBP/EUR exchange rate was trading at around €1.1665. Down roughly 0.2% from the start of last week’s session.

Latest — Exchange Rates:

Pound to Euro (GBP/EUR): 1.168523 (+0.10%)

Pound to Dollar (GBP/USD): 1.36445 (+0.01%)

Euro to Dollar (EUR/USD): 1.16767 (-0.09%)

DAILY RECAP:

The Pound (GBP) was met by volatility last week as a series of UK economic releases painted an inconsistent picture of the domestic economy, leaving investors with little clarity over the outlook for Bank of England (BoE) monetary policy.

Sterling came under pressure at the beginning of the week after employment figures revealed that unemployment remained stuck at 4.9%, while wage growth slowed to its weakest level since late 2020 among private-sector workers.

The Pound failed to find much support from Wednesday's inflation figures either, with an acceleration in price growth doing little to strengthen expectations that the BoE will resume raising interest rates later this year.

Sterling subsequently attempted to recover, but its gains faded as a steep drop in retail sales undermined confidence in the UK consumer economy. Even a stronger-than-expected set of PMI readings offered limited support, leaving GBP exchanges subdued heading into the weekend.

The Euro (EUR) drifted higher through the first half of last week, with the single currency attracting modest support amid a stronger-than-expected improvement in German economic sentiment.

The Euro then really started to catch bids in mid-week trade as its inverse trade relationship with the US Dollar (USD) saw EUR demand jump as the 'Greenback' nosedived.

However, the single currency was unable to sustain its best levels, being pressured in the latter half of the week by fresh European energy price concerns.

Near-Term GBP/EUR Forecast: ECB Minutes to Offer Direction to the Euro? Turning to this week, the primary catalyst of movement for the Pound to Euro exchange rate may be the publication of the minutes from the European Central Bank's (ECB) July policy meeting.

If the minutes indicate that policymakers are open to tightening monetary policy in the short-term it's likely to bolster bets for a September rate hike and lift the single currency.

Meanwhile, with notable UK economic data set to dry up and UK parliament still in recess, movement in the Pound will likely be linked to wider market trends this week.

Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.

At 05:13 GMT, Spot Gold (XAUUSD) was trading at $4,641.19, up $38.20, or 0.83%.

The PCE Number Lands Before Jackson Hole and That Order Matters Wednesday’s PCE report is the week’s first major risk event. Economists expect core PCE to rise 0.2% from the prior month, keeping the annual rate near 3.3%. Headline PCE is expected to rise 0.1%, putting the yearly rate near 3.6%. The report also includes July personal income and spending data, along with an updated estimate of second-quarter economic growth. That gives the bond market several numbers to trade at the same time.

The trade that helped gold move higher last week was built on a weaker dollar and softer rate expectations. The PCE number will tell the market whether that trade still has room to work or whether inflation is going to hand control back to yields.

PCE arrives two days before Warsh speaks. The data sets the tone before the Fed chair reaches the podium, and the market will already be positioned by the time Jackson Hole starts.

Warsh Has Not Tipped His Hand and the Long Bond Is Priced for It Fed Chair Kevin Warsh addresses the Jackson Hole Economic Policy Symposium on Friday. It will be his first major address at the event since becoming Fed chair, and the market is not waiting for a routine speech. Warsh has avoided giving clear signals about the next move in interest rates. That has left traders working from the data, the bond market and every shift in the inflation outlook.

The long bond is pricing the cost of government borrowing, stubborn inflation, and debt that has moved above $40 trillion. Gold has support from the weak dollar and concern over the cost of funding Washington, but yields at these levels still give sellers a reason to show up. That conflict has been the gold trade for weeks and Warsh is the next voice that can move it.

TL;DR: Canada is facing 50% US tariffs after trade talks collapsed, yet USD/CAD’s muted reaction — with oil, bonds, and the Dollar all failing to confirm a Canada-specific stress trade — suggests markets see this as a narrower, contained shock rather than an economy-wide one.

Why Isn’t the Canadian Dollar Falling Harder? Canada entered the week with two apparently bearish developments already in place. US trade talks had collapsed, new 50% tariffs were in force, and oil was retreating from recent highs. Yet USD/CAD’s response has been restrained rather than disorderly. The pair recovered from 1.3730, but has so far failed to produce the kind of upside acceleration that headline severity might suggest. That muted reaction is important: the FX market appears to be distinguishing an unusually aggressive trade action from an immediate economy-wide shock.

Part of the explanation is scope. The 50% tariff rate is eye-catching, but duties apply to roughly C$28bn, or about US$20bn, of Canadian exports — not the entire Canada-US trade relationship. Timing also matters. US measures took effect Saturday, so Monday’s session is digesting an outcome known since late Friday rather than reacting to a fresh intraday surprise. Canada’s promised dollar-for-dollar retaliation isn’t scheduled to begin until September 8, leaving roughly two weeks before the full two-way tariff confrontation reaches the real economy.

How a Near-Deal Collapsed The breakdown was nevertheless abrupt. US President Donald Trump temporarily postponed implementation last week as negotiations appeared close, and Canada’s trade minister Dominic LeBlanc held lengthy talks with USTR Jamieson Greer as both sides continued trying to bridge differences. Talks then failed late Friday, allowing 50% duties to take effect shortly after midnight Saturday.

Canadian Prime Minister Mark Carney subsequently called the tariffs a “miscalculation” and said the US side had introduced last-minute changes Canada considered unfair and uneconomic. Washington has framed the dispute differently, focusing in part on Canada’s refusal to remove retaliatory restrictions imposed during earlier tariff rounds, including provincial bans on sales of some US alcohol.

The accounts aren’t necessarily mutually exclusive: what Ottawa describes as a late change could be the same demand Washington viewed as an unresolved condition. Neither side has released the full draft agreement, leaving the exact final sticking point uncertain and giving Canada’s opposition another opening to press Carney for disclosure. The escalation is also notable because Trump used Section 338 of the Tariff Act of 1930, an extraordinary provision that had not previously been used by a US president to impose tariffs.

Oil and Bonds Aren’t Confirming a Canada Stress Trade Oil adds another nominally bearish input for CAD, but the current decline is weaker as a signal than the headline suggests. Crude retreated after two consecutive weekly gains as traders took profits ahead of Treasury Secretary Scott Bessent’s expected Iran sanctions announcement today. That’s different from an oil selloff driven by collapsing demand expectations or a fresh deterioration in global growth. For a commodity-sensitive currency such as CAD, that distinction matters.

Canadian rates are also not showing a parallel stress signal. Canada’s 10-year yield has stayed firm rather than reflecting a clear growth or capital-flight repricing. More importantly, the USD itself isn’t providing the reinforcing half of the trade. The DXY is flat to slightly softer, while the broader Dollar downtrend over the past month is still intact. USD/CAD tends to move most aggressively when Canada-specific weakness is paired with broad Dollar strength — that combination is missing so far.

ActionForex’s Technical View on USD/CAD Technically, a temporary low should be in place at 1.3730, and some consolidation above that level is likely first. But upside should be limited by 1.3927, the 38.2% retracement of the decline from 1.4247 to 1.3730. That level now carries added macro significance: a firm break would suggest Canada-specific trade risk is becoming strong enough to overpower the broader bearish Dollar structure, opening a stronger recovery toward 1.4002 support turned resistance.

For now, the larger outlook is unchanged. The rebound from 1.3480 appears to have completed as a three-wave corrective move at 1.4247. A break below 1.3730 would resume the decline toward 1.3480.

If USD/CAD can’t clear 1.3927 despite 50% tariff headlines and weaker oil, the market’s message would be difficult to ignore: the immediate Canada risk premium is still contained, while the Dollar side of the pair continues to exert greater influence. September 8, when Canada’s retaliation is scheduled to begin, is the next obvious test of whether that judgment holds.

Key Takeaways USD/CAD’s recovery from 1.3730 has stayed restrained despite 50% tariffs, signaling markets see this as a contained shock rather than an economy-wide one. The tariffs apply to roughly C$28bn of exports, not Canada’s entire trade relationship, and Canada’s retaliation doesn’t begin until September 8, delaying the full economic impact. Trump invoked Section 338 of the Tariff Act of 1930, a provision no US president had used before, underscoring how unusual this escalation is even with its narrower economic scope. Oil’s decline reflects profit-taking ahead of an Iran sanctions announcement, not a demand-driven selloff, while Canadian yields and the Dollar aren’t confirming a Canada-specific stress trade. 1.3927 is the key resistance test; failure to clear it despite the tariff headlines would confirm the Canada risk premium remains contained, while a break would open a run toward 1.4002.

ActionForex

ActionForex.com was set up back in 2004 with the aim to provide insightful analysis to forex traders, serving the trading community for two decades. We started providing only a daily and a mid-day report, now known as Action Insights. Gradually, we added a lot more in-house contents to the site. Technical Outlook section was expanded to cover more pairs. In addition to that, Top Movers, Heat Map, Pivot Point Charts and Pivot Meters, Action Bias and Volatility Charts, are tools used by traders from all over the world.

Gold prices rose in Philippines on Monday, according to data compiled by FXStreet.

The price for Gold stood at 9,197.13 Philippine Pesos (PHP) per gram, up compared with the PHP 9,134.10 it cost on Friday.

The price for Gold increased to PHP 107,275.40 per tola from PHP 106,538.30 per tola on friday.

Unit measure

Gold Price in PHP

1 Gram

9,197.13

10 Grams

91,972.83

Tola

107,275.40

Troy Ounce

286,064.30

FXStreet calculates Gold prices in Philippines by adapting international prices (USD/PHP) to the local currency and measurement units. Prices are updated daily based on the market rates taken at the time of publication. Prices are just for reference and local rates could diverge slightly.

Gold FAQs Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.

Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.

Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.

The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.

(An automation tool was used in creating this post.)

Gold prices rose in Pakistan on Monday, according to data compiled by FXStreet.

The price for Gold stood at 41,434.54 Pakistani Rupees (PKR) per gram, up compared with the PKR 41,128.96 it cost on Friday.

The price for Gold increased to PKR 483,284.30 per tola from PKR 479,720.10 per tola on friday.

Unit measure

Gold Price in PKR

1 Gram

41,434.54

10 Grams

414,364.60

Tola

483,284.30

Troy Ounce

1,288,748.00

FXStreet calculates Gold prices in Pakistan by adapting international prices (USD/PKR) to the local currency and measurement units. Prices are updated daily based on the market rates taken at the time of publication. Prices are just for reference and local rates could diverge slightly.

Gold FAQs Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.

Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.

Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.

The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.

(An automation tool was used in creating this post.)

Gold (XAU/USD) builds on last week's breakout momentum above a technically significant 200-day Simple Moving Average (SMA) and climbs above $4,650 during the Asian session on Monday, hitting a fresh high since mid-May. The US Dollar (USD) languishes near an over three-month low amid receding bets for an immediate interest rate hike by the US Federal Reserve (Fed) and softer US Treasury bond yields, which, in turn, lend support to the non-yielding bullion.

Tamer July US inflation data cooled expectations for near-term Fed policy tightening. Consequently, market expectations have shifted toward a policy hold at the upcoming September 15–16 FOMC meeting. Adding to this, US Treasury Secretary Scott Bessent showed readiness to intervene more aggressively as bond yields moved higher than before the buyback announcement. In fact, the US Department of the Treasury said last Wednesday that it would at least double buyback operations for long-dated government debt starting in September. Bessent reassured markets that the size of the buyback could be more than the $4 billion per issue. This keeps US bond yields depressed below a multi-year peak and fails to assist the USD to register any meaningful recovery.

Meanwhile, markets are still pricing in over a 70% chance that the US central bank will raise borrowing costs at least once by the end of this year amid inflation risks stemming from volatile oil prices. Hence, the focus shifts to the release of the US Personal Consumption Expenditures (PCE) Price Index on Wednesday. Apart from this, Fed Chair Kevin Warsh's speech at the Jackson Hole Symposium will be scrutinized for cues about the central bank's future policy path, which, in turn, should provide some meaningful impetus to the USD and drive the Gold price. In the meantime, geopolitical uncertainties could support the safe-haven buck.

US Treasury Secretary Scott Bessent is due to announce what he has called the toughest sanctions in history on Iran at a press conference on Monday. Iran's Supreme National Security Council secretary, Mohsen Rezaei, responded by warning that the Islamic Republic would halt all oil exports through the Strait of Hormuz and anywhere else in the Persian Gulf if economic war continues. Rezaei added that any country's participation in the US sanctions would be treated as an act of war against Iran. This, in turn, keeps the war-risk premium in play, which limits the downside for the Greenback and might keep a lid on the Gold price, warranting caution for bulls.

XAU/USD daily chart

Technical AnalysisFriday's close above the $4,615-$4,620 confluence – comprising the 200-day SMA and the 61.8% Fibonacci retracement level of the April-June decline – was seen as a fresh trigger for XAU/USD bulls. Adding to this, the Moving Average Convergence Divergence (MACD) indicator stays in positive territory with rising values, hinting at persistent upward momentum. However, the Relative Strength Index (RSI) at 71.77 shows overbought conditions that could limit immediate upside.

Hence, any subsequent move up could face initial resistance at the 78.6% Fibo. retracement near $4,684.43, above which Gold could aim to test the cycle high around $4,891.38. On the downside, the first meaningful support emerges from the 61.8% Fibo. retracement at $4,521.97, reinforced by the 200-day SMA at $4,516.88, with deeper structural floors seen at the 50% retracement at $4,407.86 and the 38.2% level at $4,293.75.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Fed FAQs Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.

The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions. The FOMC is attended by twelve Fed officials – the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.

In extreme situations, the Federal Reserve may resort to a policy named Quantitative Easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used during crises or when inflation is extremely low. It was the Fed’s weapon of choice during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy high grade bonds from financial institutions. QE usually weakens the US Dollar.

Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing, to purchase new bonds. It is usually positive for the value of the US Dollar.

Gold prices rose in Malaysia on Monday, according to data compiled by FXStreet.

The price for Gold stood at 602.86 Malaysian Ringgits (MYR) per gram, up compared with the MYR 598.07 it cost on Friday.

The price for Gold increased to MYR 7,031.62 per tola from MYR 6,975.73 per tola on friday.

Unit measure

Gold Price in MYR

1 Gram

602.86

10 Grams

6,028.59

Tola

7,031.62

Troy Ounce

18,750.83

FXStreet calculates Gold prices in Malaysia by adapting international prices (USD/MYR) to the local currency and measurement units. Prices are updated daily based on the market rates taken at the time of publication. Prices are just for reference and local rates could diverge slightly.

Gold FAQs Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.

Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.

Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.

The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.

(An automation tool was used in creating this post.)

By

:

Published: Aug 24, 2026, 03:46 GMT+00:00

$4,644.59

+0.44%

Key Points:A weaker U.S. dollar is pushing gold higher towards the key resistance.Gold needs to break above $5,000 to extend its rally toward record highs.Silver must clear $72 to open the way toward the $90 area.

Gold

+0.44%

Gold ForecastSilver

-0.42%

Silver ForecastGold (XAU) prices rose to a three-month high as the weakness in the US dollar increased demand for the precious metal. Spot gold gained over 5% last week to near $4,640. Treasury plans to increase purchases of the long term bonds have pressured the dollar. Investors may also view higher bond yields as a sign of fiscal stress and policy uncertainty. These concerns, along with the prospect of stricter U.S. sanctions against Iran, are driving demand for gold as safe haven.

Gold and silver (XAG) are now approaching their short term resistance and the next move will depend on the July PCE inflation data and Fed Chair Kevin Warsh’s Jackson Hole speech. Softer inflation or more cautious tone from Warsh could weaken the US dollar and support further gains in gold and silver prices. But strong inflation data or a hawkish Fed tone could lift yields and pressure gold and silver prices.

Gold Price Forecast: $5,000 Resistance Comes into Focus The spot gold price gained 5.17% last week and produced a strong weekly bullish candle. The rebound from the ascending trend line that stretches from the October 2023 lows signals constructive bullish price action. This constructive bullish price action on the weekly chart points to the target of $4,850 and $5,000.

A break above the $5,000 area will open the door for a strong surge in the gold market towards record highs.

The 4-hour chart for spot gold also shows constructive price action as the consolidation in June and July has formed a rounding bottom pattern. But this bottom pattern will only be confirmed when the price produces a confirmed break above the $5,000 area.

However, the breakout from the descending trend line that stretches from the March 2026 highs indicates that the short term momentum has shifted to the upside.

Silver Price Forecast: Break Above $72 Could Target $90 Silver price faces strong resistance at $72. This is a key level in the silver market. But the price has already broken the triangle pattern on the line chart. This breakout indicates that the price may continue to rally toward the $90 area soon. But the price still needs to break above $72 to maintain the strong rally in the silver market.

If the price fails to break above $72, it may drop further toward the $60 area. The $72 level in spot silver is also marked by the 200-day SMA. This key level is also observed on the 4-hour chart which shows the formation of an ascending channel pattern. The resistance of the ascending channel is near $72.

Key Levels to Watch Gold and silver remain in bullish price structures, but both metals are approaching key resistance. Gold must break above the $4,800-$5,000 zone to target the record highs. Silver must clear $72 to open the way toward $90. A weaker U.S. dollar, softer PCE inflation and a cautious Fed message could support these breakouts. But a stronger inflation or hawkish Fed tone could lift yields and trigger a pullback. A break below $4,200 in spot gold and $60 in spot silver may negate the short term bullish price structure.

Read more: Bullish Momentum Builds in Silver as Dollar Weakens

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Muhammad Umair is a finance MBA and engineering PhD. As a seasoned financial analyst specializing in currencies and precious metals, he combines his multidisciplinary academic background to deliver a data-driven, contrarian perspective. As founder of Gold Predictors, he leads a team providing advanced market analytics, quantitative research, and refined precious metals trading strategies.

Latest news and analysis

Key highlightsEUR/USD started a major increase and climbed above 1.1620.A bullish trend line is forming with support near 1.1610 on the 4-hour chart.EUR/USD technical analysisLooking at the 4-hour chart, the pair settled above 1.1600, the 100 simple moving average (red, 4-hour), and the 200 simple moving average (green, 4-hour). The pair climbed above 1.1700 and traded as high as 1.1711 on TitanFX before it started a consolidation phase.

If there is a downside correction, the pair might find bids near 1.1635. The first major support could be near 1.1610 and the 50% Fib retracement level of the upward move from the 1.1511 swing low to the 1.1711 high.

There is also a bullish trend line forming with support at 1.1610. The next major support could be near 1.1560 and the 100 simple moving average (red, 4-hour).

The main support might be 1.1500 and the 200 simple moving average (green, 4-hour). A downside break and close below 1.1500 might send the pair toward 1.1420. Any more losses could open the door for a test of 1.1350.

On the upside, the pair is now facing a major hurdle at 1.1700. The next major resistance might be 1.1725. A close above 1.1725 could start another steady increase. In the stated case, the bulls could aim for a move to 1.1800. Any further gains might open the door for a test of 1.1880.

Platinum: ⬆️ Buy

– Platinum broke resistance zone

– Likely to rise to resistance level 2000.00

Platinum recently broke the resistance zone between the resistance level 1835.00 (which has been reversing the price from June), resistance trendline from March and the 61.8% Fibonacci correction of the downward impulse from June.

The breakout of this resistance zone accelerated the active intermediate impulse wave (3).

Platinum can be expected to rise further to the next round resistance level 2000.00 – former top of wave 2 from the start of June – and the target for the completion of the active wave 3.

FxProhttp://www.fxpro.co.uk/?ib=606792

FxPro is an award-winning online broker offering Contracts for Difference (CFDs) on forex, futures, spot indices, shares, spot metals and spot energies. FxPro serves clients in over 150 countries worldwide and offers multilingual customer support 24/5. Trading CFDs involves significant risk of loss.

Gold and Bitcoin surged after the U.S. Treasury announced it would double the size of its long-term bond buybacks from $2 billion to at least $4 billion per operation. This was important because the move pushed bond prices higher and weakened the U.S. dollar. Gold jumped sharply, while Bitcoin broke out of its recent range and rose around 20%.

Major U.S. and Japanese stock indexes finished the week lower as investors became more cautious. High bond yields, U.S.-Iran tensions, and weakness in AI and semiconductor stocks hurt sentiment. Higher WTI crude oil prices were also negative for Japan, as more expensive energy can increase costs for Japanese businesses.

WTI crude oil rose as U.S.-Iran tensions increased, including the possibility of new U.S. economic sanctions on Iran. Meanwhile, the Fed’s July meeting minutes showed that officials expect inflation to slow, but another rate hike could be needed if inflation remains high.

Markets This Week U.S. Stocks The Dow started the week below the 10-day moving average, encouraging further selling throughout the week. Higher WTI crude oil prices and concerns about the U.S. bond market added to the weakness. The market is now in a short-term downtrend, so selling strength around the 10-day moving average could be the preferred strategy this week. Resistance levels are at 53,500, 54,000, 54,500, 55,000 and 56,000. Support is seen at 52,500, 51,500, 51,000 and 50,000.

Japanese Stocks The Nikkei lost all of the previous week’s gains as higher WTI crude oil prices worried investors, while weaker-than-expected Japanese GDP added to the negative sentiment. The market is likely to trade sideways to lower this week, with the 10-day moving average flattening and prices near the middle of the Bollinger Bands. Traders will also focus on the possibility of a Bank of Japan interest rate hike next month. Resistance is at 67,500, 69,500, 70,000 and 71,000. Support is at 65,000, 64,000, 63,000 and 62,000.

USD/JPY USD/JPY moved higher early last week as WTI crude oil prices rose, but the surprise increase in U.S. government bond purchases weakened the U.S. dollar midweek and pushed the pair lower for the week. With resistance near the upper Bollinger Band and the market closing below the 10-day moving average, USD/JPY could trade sideways to lower ahead of important U.S. data on Wednesday, which will likely provide direction for the rest of the week. Resistance is at 159.50, 160.00, 161.00, 162.00, 164.00 and 165.00, while support is at 158.50, 158.00, 157.00, 156.00, 155.00 and 154.00.

Gold Profit-taking pushed gold lower at the start of last week, before the surprise increase in U.S. government bond purchases led to strong buying from longer-term investors worried about the future value of the U.S. dollar. Buying continued into the end of the week, keeping the medium-term uptrend very strong. The upper Bollinger Band is now acting as short-term resistance, so short-term traders could look to sell if prices start to weaken. Medium-term traders may prefer to follow the uptrend and wait for a move closer to the 10-day moving average before buying. Resistance is at $4,650, $4,700, $4,775, $4,900 and $5,000, while support is at $4,450, $4,350, $4,300, $4,225, $4,200, $4,125 and $4,100.

Crude Oil WTI crude oil moved higher throughout last week as the U.S. threatened new economic sanctions against Iran and discussed taking control of the Strait of Hormuz. Oil largely ignored weaker U.S. economic data, which could reduce demand. News headlines can still quickly change the market direction, but for now, higher prices look more likely this week. Resistance is at $90, $95 and $100, while support is at $80, $75, $67.50, $65 and $60.

Bitcoin Bitcoin finally came back to life last Wednesday after the U.S. Treasury announced plans to increase its long-term bond buybacks. This weakened confidence in the U.S. dollar and increased interest in alternative assets such as Bitcoin. President Donald Trump also called for faster progress on crypto legislation, adding to the buying. While the outlook has improved, Bitcoin looks overbought in the short term and could move lower this week. A pullback toward $67,500–$70,000 could offer a medium-term buying opportunity. Resistance is at $80,000, $85,000, $90,000, $95,000 and $100,000, while support is at $65,000, $62,000, $60,000, $55,000 and $50,000.

This Week’s Focus Monday: None Tuesday: Australia RBA Meeting Minutes, Japan BoJ Core CPI, U.S. Building Permits, CB Consumer Confidence and New Home Sales Wednesday: U.S. Core PCE Price Index, GDP and Durable Goods Orders Thursday: Australia Private New Capital Expenditure, E.U. ECB Publishes Account of Monetary Policy Meeting, U.S. Jackson Hole Symposium Friday: Japan Tokyo Core CPI, Unemployment Rate, U.S. Michigan Consumer Sentiment WTI crude oil will remain in focus early in the week as the U.S. increases pressure on Iran. Markets will also watch whether gold and Bitcoin can continue their recent strong rises and whether selling pressure on stock markets continues. Attention will then shift to major U.S. data on Wednesday, followed by the Jackson Hole meeting from Thursday, where comments from Fed officials on inflation and interest rates could move markets.

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XAUUSD Climbs as Technical Wave Analysis Predicts Upside

Hello Traders, in today’s blog, we’re reviewing the XAUUSD wave count shared with our members, which pointed to a strong bullish outlook. The Elliott Wave pattern confirmed the move, sending the precious metal surging over 2000 points.

Technical Outlook After Gold Completes Major Correction from All‑Time Highs

The precious metal peaked earlier this year at 5589.97 on 01.29.2026, and subsequently underwent a six-month corrective phase, wrapping up at 3940.68 on June 30, 2026. Since hitting that low, Gold rallied to complete wave (4) at 4309.78. It then turned higher, completed wave 1 of the new nest, and pulled back in a proposed wave 2 flat correction against 4309.78.

The Forecast: Completion of Wave 2 Correction

Our initial analysis focused on Gold completing a corrective structure, labelled as wave ((c)) of 2. Because corrective phases present prime opportunities to align with the primary trend, we monitored support closely. The setup held firmly above our established Invalidation Level at 3997.04—and most importantly, above the wave (4) low (4309.78)—confirming the end of the correction and the start of a new bullish wave. See chart below

The Result: Impulsive Rally Hits 4630.22

Following the completion of wave ((c)) of 2, price action accelerated rapidly in an impulsive wave pattern. Gold broke above the wave (3) peak to confirm the next leg higher, surging over 2,000 points toward the 4630.22 level. Driven by this strong upside momentum, the invalidation level was adjusted higher to 4309.78 to align with the new market structure. See chart below

What’s Next for Gold in the Coming Weeks?

According to our latest chart update, the short-term outlook favors a minor wave ((iv)) pullback before a final push higher in wave ((v)). This move will complete wave 3 from the August 19, 2026 low, setting the stage for a broader wave 4 correction that should hold above the wave 2 invalidation point. Once wave 4 finishes, price should resume the main uptrend to complete the full impulsive cycle from the June 2026 lows before entering a larger correction.

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Gold price (XAU/USD) gains traction to around $4,625 during the early Asian trading hours on Monday. The precious metal climbs to the highest since May 15 as the US Treasury's buyback support plan weighs on the US Dollar (USD).

US Treasury Secretary Scott Bessent said on Thursday the government could increase bond buybacks beyond $4 billion, a day after the department unveiled plans to double buybacks of longer-dated securities. 

This development has cooled Treasury yields and dragged the USD lower. It’s worth noting that because gold is priced in the USD, a weakening currency makes it significantly cheaper and more attractive to foreign buyers. 

"A big factor, of course, is technical... next step is $4,700 if this momentum continues, but also I think it's been very much driven by a drop in the U.S. dollar," said Bart Melek, global head of commodity strategy at TD Securities.

On the other hand, energy-driven inflation concerns amid ongoing Middle East tensions could raise the prospect of Federal Reserve (Fed) rate hikes in the coming months. This, in turn, might cap the upside for the yellow metal. Gold is often used as a hedge against inflation but does not yield interest, making it less attractive when interest rates are high.

Iran's Foreign Minister Abbas Araghchi dismissed the threat of a fresh round of US economic sanctions as a “desperate” ploy and said the expected new measures would fail to defeat Tehran, per Reuters. US President Donald Trump last week announced a new campaign to increase the pressure on the Iranian economy, calling it “the most crushing economic operation ever taken against any country”.  

Treasury support at the long end underpins Gold as Fed looks through energyAccording to TD Securities, “the signal of the Treasury looking to support the longer end may offer enough support on its own,” particularly for Gold and the broader precious metals complex. This is reinforced by “a Fed willing to look past higher energy prices,” which, in their view, helps sustain the current higher trading range and keeps the door open to further upside as trend-following flows respond to the evolving policy backdrop.

Technical Analysis: Gold maintains a constructive outlook amid overbought RSI momentumIn the daily chart, XAU/USD holds a bullish near-term bias as it extends above the 100-day simple moving average (SMA) and the Bollinger middle band, keeping the broader uptrend supported. However, the latest 14-period Relative Strength Index at 70.81 shows overbought conditions, hinting that upside momentum could be stretched even as price pushes toward the upper Bollinger band.

On the topside, immediate resistance is aligned with the Bollinger upper band at roughly $4,675.80, where fresh supply could emerge if buyers attempt another leg higher. On the downside, initial support is seen at the current price area as a nascent floor, followed by the 100-day SMA at $4,379.39 and the Bollinger middle band at $4,305.50, while a deeper correction would expose the lower Bollinger band near $3,935.20.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Gold FAQs Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.

Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.

Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.

The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.

EUR/USD remains stronger for the fourth successive trading day, hovering around 1.1680 during the Asian hours on Monday. The currency pair holds its ground as the US Dollar (USD) struggles under pressure from newly announced United States (US) fiscal moves. The Treasury Department surprised financial markets by pledging to at least double its buybacks of longer-dated government debt in an attempt to rein in rising bond yields. Treasury Secretary Scott Bessent noted that buybacks could expand beyond $4 billion, a strategic effort aimed at signaling that elevated yields do not accurately align with underlying economic fundamentals.

Despite this pressure on the Greenback, further upside for EUR/USD may remain limited due to safe-haven demand supporting the US Dollar amid escalating geopolitical tensions in the Middle East. Tensions flared after Iranian Foreign Minister Abbas Araghchi dismissed upcoming US sanctions as an act of desperation that would fail to weaken Tehran. Adding to the friction, Iranian Security Chief Mohsen Rezaei warned of "earthquake-like" retaliation if US President Donald Trump takes further action, reinforcing risk-off sentiment in global markets.

On the European front, the Euro (EUR) is drawing baseline support from sticky inflation figures and persistent expectations of ECB monetary policy. Eurozone consumer inflation expectations over the next year ticked down slightly to 2.9% from 3% in June. However, because price growth remains well above the European Central Bank's 2% target, markets continue to price in the possibility of additional monetary tightening following June’s interest rate hike.

Analysts at Rabobank expect the ECB to move gradually toward a new framework for structural Longer-term Refinancing Operations as excess liquidity declines. They note that “the ECB could start discussions about the design of structural LTROs towards the end of this year, but the launch date depends on banks’ demand for reserves.” In their view, “12 months is a plausible maturity for these operations,” with the central bank likely favouring a more market-driven approach. Rabobank adds that “the ECB may issue the LTROs by auction, instead of the fixed-rate, full-allotment procedure,” aligning the new tool more closely with standard refinancing operations while still supporting reserve demand.

Euro FAQs The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).

The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.

Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.

Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.

Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

The latest COT report shows traders trimming US dollar exposure, rebuilding Canadian dollar longs and cautiously returning to Japanese yen shorts. However, the positioning data predates Wednesday's sharp USD selloff, leaving Jackson Hole as the next major test for FX markets.

The Gold price has broken above $4,600 as US bond-market intervention revives debasement fears, with Goldman seeing policy volatility supporting safe havens. The Gold price in US Dollars (XAU/USD) finished Friday around $4,604 an ounce after a striking acceleration in the second half of August.

Bullion has gained almost 14% this month and reached $4,631.67 at its latest high, extending the recovery from below $4,000 in late July.

This latest move is not simply another lower-rates trade.

Goldman Sachs sees a more unusual policy story developing around the US Treasury market, the Dollar and the traditional safe havens.

Its FX strategy team highlighted Wednesday's decision to ramp up long-end Treasury buybacks, which produced only a moderate fall in long-dated yields but a much larger reaction across currencies.

“The announcement drove the Dollar weaker virtually across the board,” Goldman said, pointing to renewed policy uncertainty and “an effective shift in the burden of recent pressures from USTs to the Dollar.”

That distinction matters for gold.

If policymakers succeed in containing long-term Treasury yields but the adjustment instead comes through a weaker Dollar, bullion gets support without needing a dramatic collapse in nominal bond yields.

Goldman also sees the safe-haven behaviour itself as significant.

“Sharp increases in typical safe haven assets like gold and CHF are characteristic of episodes in 2025 where higher policy volatility came alongside renewed scrutiny of the US’s underlying fiscal trajectory,” the bank said.

The desk added that “the terms of trade imprint for the move in gold prices is key here as well”, helping explain why the Swiss Franc and some commodity-linked currencies also benefited.

Put slightly differently, the Dollar is starting to act as the release valve when pressure builds elsewhere in US markets.

Image: XAU/USD one-month historical chart The Gold price has climbed more than 11% over the past month, with the latest advance taking price decisively above its rising 20-day moving average and towards $4,632.

LSEG's market review captures the other half of the argument.

Before Friday's final surge, gold had been holding around $4,523 despite hawkish Federal Reserve minutes and another jump in oil prices.

“Gold prices recouped some earlier losses to trade largely steady, as prospects of lower long-term real rates offset persisting risks of higher inflation underlined by rising oil prices,” the report said.

There was still some resistance to the rally.

“Gold has come under routine profit-taking pressure following the previous session's strong gains,” American Gold Exchange analyst Jim Wyckoff said in the LSEG report, with hawkish Fed signals and higher oil prices providing reasons not to chase the market indiscriminately.

The tug of war did not last long.

Gold subsequently reached a three-month high above $4,630 on Friday, while the Dollar weakened as investors continued to question the consequences of the US Treasury's decision to at least double long-end liquidity-support buybacks from $2bn to $4bn per operation.

CIBC's Sarah Ying neatly described the broader market resistance to Washington's effort: “This is Bessent testing the market and the market fighting back.”

Gold Price Outlook: Debasement Trade Meets Fed Risk Goldman's note does not attach a fresh numerical gold target, so the forecast signal here is about the regime rather than a specific destination.

Higher policy volatility, questions over US fiscal credibility and a Dollar increasingly absorbing pressure from the bond market are all constructive for bullion, particularly while long-term real-rate expectations stop rising.

We have already seen another part of that story in our latest look at gold, oil and the Dollar, where the unusual mix of higher commodity prices, high bond yields and a weaker Greenback pointed to growing unease over the US policy outlook.

The numerical forecasts elsewhere remain bullish too.

In our recent UBS gold forecast, we noted the bank's path from $4,600 at the end of 2026 to $5,000 in March and $5,200 by June 2027.

The next test comes quickly, with July PCE inflation due on Wednesday before the Jackson Hole symposium runs from 27-29 August.

A hawkish Fed message and renewed rise in real yields could trigger another bout of profit-taking after such a powerful August advance.

If policy uncertainty keeps falling on the Dollar instead, Goldman's analysis suggests bullion can remain one of the cleaner beneficiaries.

At $4,600, the debasement trade is no longer theoretical.

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After nearly 12 years in the markets, Alan’s biggest lessons are not about finding the perfect trade. They are about discipline, risk, and staying in the game long enough to improve.

Brits regret not buying Gold but didn't learn their lesson

The Australian dollar not only rallied for an eighth consecutive week – its best run since December 2020 – but the move also accelerated to mark its strongest week in 18. AUD/USD now sits within striking distance of 72c at an 11-week high.

The Japanese yen notched up a rare win against the US dollar last week, aided by the very same forces that have contributed to its persistent weakness over recent years.

The Gold price’s break above its 200-day average strengthens the near-term outlook, with $4,700 now the first major test and $4,500 providing support. The Gold price (XAU/USD) entered the weekend near $4,604 an ounce after climbing more than 5% over the week and reaching its highest level since mid-May.

Friday’s advance carried spot gold as high as $4,631.99, while US futures settled at $4,680.60.

The move above the 200-day moving average around $4,513 marked an important change in the technical picture and strengthened the case for a further recovery towards $4,700.

Gold benefited from a sharp Dollar decline after US Treasury plans to expand purchases of longer-dated government debt unsettled investors and pulled capital towards alternative stores of value.

The policy announcement also helped ease long-term yields, reducing the opportunity cost of holding a non-interest-bearing asset.

Goldman Sachs reported renewed speculative interest in COMEX gold and rate-sensitive exchange-traded funds, while unusually strong demand for call options amplified the advance.

Gold broke decisively above $4,500 as Dollar selling and renewed demand for macroeconomic hedges accelerated.

Near-Term Gold Price Prediction: $4,700 Becomes the First Test The immediate gold price forecast has turned bullish following Friday’s close above both the 200-day average and the downward trend line from the January record.

Initial resistance is expected between $4,654 and $4,689, where measured technical projections converge with retracement levels from the earlier decline.

TD Securities global head of commodity strategy Bart Melek said: “Next step is $4,700 if this momentum continues.”

A sustained break above $4,700 would strengthen the recovery and expose the $4,770–$4,780 region.

Technical analyst Bruce Powers identified the April swing high around $4,891 as the larger upside objective if buyers retain control.

That would leave gold within reach of the psychologically important $5,000 level, although momentum indicators suggest the market could consolidate or correct before mounting such an advance.

The first important support zone is now located between $4,500 and $4,516.

Holding this area would indicate that former resistance has become support and keep the bullish breakout intact.

A daily close below $4,500 would weaken the signal and risk a retreat towards $4,450, followed by the August 14 low near $4,310.

Losses below $4,300 would represent a more serious deterioration, potentially returning attention to the $4,000 region that supported gold during the June correction.

Indian Demand Strengthens the Floor, Not the Immediate Target World Gold Council research also revealed improving demand conditions in India ahead of the festive season, although the figures should be viewed as evidence of support during price declines rather than justification for an uninterrupted rally.

The Council’s reference price of $4,391 was recorded on August 14, before gold subsequently broke above $4,600.

Research Head for India Kavita Chacko said: “Demand conditions are improving, raising expectations of a stronger festive season.”

Jewellery retailers and manufacturers replenished inventories as consumers returned after June’s sharp correction and July’s period of greater price stability.

Local discounts narrowed from around $100 an ounce in May and early June to approximately $45 by mid-August, pointing to a better balance between available supply and immediate demand.

Estimated Indian gold imports recovered to 40–45 tonnes in July from 20 tonnes during June, while their value more than doubled from $1.97bn to $4.16bn.

Investment demand provided a second source of support.

Indian gold ETFs attracted net inflows of $163mn during July, followed by an estimated $124mn during the first two weeks of August.

There are limits to how much support the physical market can provide at current prices.

Friday’s surge above $4,600 reportedly deterred some Indian retail buyers, while elevated prices could encourage households to exchange old jewellery and postpone discretionary purchases.

The medium-term institutional outlook nevertheless retains a bullish bias.

UBS expects gold to reach $5,000 an ounce during the first half of 2027, supported by eventual Federal Reserve easing, portfolio diversification and continuing official-sector demand.

UBS Chief Investment Officer Mark Haefele said periods of weakness towards $4,000 “may ultimately prove to be opportunities to build strategic exposure.”

Our base-case forecast is for gold to remain supported above $4,500 and challenge $4,654–$4,700.

A confirmed break higher would target $4,770–$4,780 and potentially $4,891, while a close below $4,500 would warn that the breakout had failed.

US PCE inflation data on Wednesday and Federal Reserve Chair Kevin Warsh’s Jackson Hole address on Friday will be the principal tests next week.

Softer inflation or reduced expectations of another US rate increase would favour further gains, whereas a renewed rise in yields and the Dollar could trigger a correction towards breakout support.

This content was created by an affiliate of FOREX.com and represents the views and opinions of the author/speakers, not the views and opinions of Forex.com, StoneX Group Inc., or its subsidiaries. The content has not been independently reviewed by FOREX.com.

Dollar Is Approaching a Much Bigger Technical Test Dollar’s selloff is not just about this week’s Treasury buyback announcement. DXY has broken important support and is moving toward levels that could turn a medium-term decline into a much larger structural breakdown. A decisive break of 95.55 would threaten the multi-decade rising channel and eventually bring 90 area into view. On other side, EUR/USD would likely be challenging 1.20 at roughly same time — a breakout that would carry similarly important long-term implications.

What makes technical setup more significant is that several very different analytical routes are pointing in same direction. Bond managers have focused on financing mechanics. Treasury’s own advisory committee has laid out limits of what buybacks can achieve. Fitch has approached issue through sovereign-credit arithmetic. Ray Dalio has looked at it through debt-cycle experience. Dollar traders are now expressing their own verdict through price.

These approaches do not start from same place, but they converge on one distinction: Treasury can manage where financing pressure appears, while buybacks do not remove underlying borrowing requirement. Initial Dollar reaction on August 19 could be explained by falling Treasury yields after larger buybacks were announced. By end of week, however, greenback remained broadly weaker even after yields recovered part of their initial fall. That raises a much bigger question for coming weeks: is Dollar merely extending a correction, or beginning to price fiscal concerns deeply enough to break DXY through 95.55 and send EUR/USD above 1.20?

What Treasury Actually Did Treasury announced on August 19 that it would increase buybacks in longer-dated nominal debt. Maximum operations in the 10–20 year and 20–30 year sectors were lifted from $2bn to at least $4bn, with larger operations scheduled between September 9 and November 4. Announcement came after 30-year Treasury yield briefly reached 5.34%, its highest since 2007.

Treasury Secretary Scott Bessent went further the following day. He said buybacks could exceed $4bn per issue and described liquidity in 30-year bonds as “very poor.” His stated aim was to improve market functioning and encourage investors to focus on fundamentals rather than headline-driven volatility.

Bond market initially responded exactly as Treasury might have hoped. Long yields fell sharply. But relief faded quickly. Ten-year yield reversed higher during Bessent’s own CNBC appearance and subsequently recovered a meaningful part of Wednesday’s decline.

That does not mean buybacks achieved nothing. They can improve liquidity and reduce pressure in parts of Treasury curve where investors have become reluctant to take duration. What they cannot do by themselves is change how much money US government ultimately needs to borrow.

And that is where first “language” comes in.

Language One: Bond Mechanics — Move the Supply, Don’t Remove It The easiest way to understand UBS’s argument is to compare Treasury buybacks with someone refinancing a mortgage.

Suppose a borrower replaces some long-term debt with shorter-term debt. Monthly financing structure changes. But total debt has not disappeared.

Treasury is doing something similar. It can buy older long-dated bonds from investors, reducing pressure in that corner of market. But it still needs money to fund government deficit and buyback itself. More Treasury bills can therefore be issued at short end.

UBS described this as reshaping debt maturity rather than reducing total Treasury supply markets must ultimately absorb. Unlike Fed quantitative easing, Treasury cannot simply create reserves to buy bonds. Financing pressure is reallocated, not eliminated.

Wellington Management’s Brij Khurana made essentially same point independently: Treasury needs to finance those purchases elsewhere, including through more bills. DBS economist Chang Wei Liang called likely impact of buyback changes “small” and “transient.” JPMorgan, Wells Fargo, Principal Asset Management and Standard Chartered all arrived at variations of same conclusion: Treasury may buy time or improve liquidity, but deficits, inflation risk and financing requirements remain.

That is why this is not really an argument over whether buybacks “work.” They can work perfectly well as a liquidity operation.

The more important question is whether investors begin treating them as a substitute for reducing borrowing needs.

So far, professional bond desks appear reluctant to do that.

Language Two: Treasury’s Own Rulebook Says Much the Same Thing The second language comes from inside Treasury’s own advisory framework.

Treasury Borrowing Advisory Committee has previously drawn a distinction between buybacks as a liquidity tool and issuance as the main tool for managing overall debt profile. In other words, even Treasury’s own advisers do not present buybacks as a way of solving underlying fiscal imbalance.

That distinction matters more because Treasury bills already account for around 22.2% of outstanding Treasury debt in the material supplied, above TBAC’s roughly 20% preferred ceiling. If more long-bond support is financed through additional short-term issuance, market has to consider whether pressure is simply being moved along curve.

There is also an uncomfortable historical echo. Bessent criticized Janet Yellen in 2024 for relying heavily on bills, saying Treasury was putting its “thumb on the scale of markets” to lower financing costs. Now Treasury itself is leaning more actively on debt-management tools as long yields approach politically and economically uncomfortable territory.

That does not automatically mean Treasury is trying to peg yields. But it does raise a broader question: where does ordinary debt management end and active management of financial conditions begin?

RSM chief economist Joseph Brusuelas warned that political pressure could increasingly push monetary and fiscal institutions toward the same objective of suppressing financing costs. That would create a difficult environment for Fed Chair Kevin Warsh, especially because Warsh has previously criticized central-bank bond purchases for keeping borrowing costs artificially low and weakening fiscal discipline.

Jackson Hole next week therefore takes on another dimension. Markets will not only listen for Fed’s inflation and rate outlook. They will also watch how Warsh defines boundary between monetary policy and Treasury’s growing role in bond-market conditions.

Language Three: Fitch Removes the Trading Desk From the Argument Fitch approaches the issue from a very different direction.

It is important not to overstate its message. Fitch affirmed US rating at AA+ with a stable outlook on August 13. It continues to highlight enormous strengths: scale of US economy, high income levels, deep capital markets and Dollar’s dominant reserve-currency role. Dollar still represents roughly 58% of global reserves and plays an overwhelming role in foreign-exchange transactions.

But Fitch’s fiscal projections show why long-term investors are uncomfortable.

General government debt is projected to rise from around 117% of GDP at end-2025 to 123% in 2028 and 128% by 2030 under current policies. Median for other AA-rated sovereigns is only 46.3%.

US general government deficit is projected at 7.4% of GDP in 2026, highest in AA category. Interest costs are also becoming much heavier. Fitch expects interest-to-revenue ratio to reach 12.6% by 2028, compared with 3.5% median for AA peers.

Current numbers reinforce that pressure. Federal debt has moved above $40tn. July deficit reached $432bn. Fiscal-year-to-date deficit is around $1.8tn, while net interest payments reached roughly $963bn over first ten months of fiscal year in the supplied research.

Fitch’s point is not that US is facing an imminent funding crisis. Its stable outlook says the opposite.

The more useful conclusion is that America’s exceptional economic scale and Dollar’s reserve status are compensating for fiscal metrics that would look much more problematic in an ordinary AA sovereign.

That makes confidence in Dollar itself part of fiscal equation.

Bessent Has a Counterargument — but It Needs Numbers Bessent is not ignoring fiscal problem. His counterargument is that current trajectory can improve without dramatic austerity.

He said there is a “very good chance” deficit has already peaked. He has also argued that US can “grow our way out” of the $40tn debt figure. A Treasury-OMB effort is examining “several hundred billion dollars” of potential fiscal consolidation.

Those arguments are plausible in principle.

A larger economy makes an existing debt burden easier to service. Faster productivity growth from AI could improve tax revenues. Spending restraint could narrow deficit. Strong tariff revenues could contribute as well.

But markets need evidence rather than promises.

If deficit really has peaked, future budget numbers should show it. If tariff receipts can stay close to 2025 levels after recent legal setbacks, Treasury data should demonstrate it. If US can grow out of debt problem, nominal GDP needs to expand quickly enough relative to debt to stabilize fiscal ratios.

This is one reason buyback announcement moved markets more than Bessent’s reassurance. Buyback was an actual policy action. Fiscal improvement remains a forecast.

Language Four: Dalio and Dimon Ask What Happens If It Isn’t Fixed Ray Dalio’s argument is different again. He is less concerned with whether a $4bn buyback lowers a particular Treasury yield by five or ten basis points. He is asking what happens if debt and debt-service costs keep compounding.

Dalio said US government financial position is at an “inflection point” and warned that debt could eventually become impossible to manage without serious economic pain. He views Treasury intervention as a symptom of that pressure rather than a cure, arguing that government has only limited capacity to keep intervening indefinitely.

His preferred solution combines three measures: cut spending, raise revenue and reduce interest rates. The important part is that he says those three need to happen together so no single adjustment becomes too extreme.

But Dalio also adds an important warning: “it would be very bad if the Federal Reserve unnaturally forced interest rates down.” In other words, lower borrowing costs may be part of a solution, but artificially suppressing them without addressing deficits simply postpones adjustment.

Jamie Dimon has raised a related but different concern. His warning is about what prolonged high debt and expensive money could expose elsewhere in financial system. In April, he said a bond crisis would eventually have to be dealt with, without offering a specific timeframe. More recently, he has highlighted high levels of leverage that may not appear in conventional margin-debt statistics because it sits inside special vehicles and securitized structures.

These are not forecasts that a crisis happens next month or even next year.

They are warnings about second-order risk: when sovereign borrowing costs stay high for long enough, stresses can migrate into places that were not obvious during earlier stages of cycle.

Language Five: Dollar Is Starting to Say the Same Thing The fifth language needs no analyst note.

Dollar Index extended its decline last week and broke decisively below 99.41, the 38.2% retracement of rebound from 95.55 to 101.80. That strengthens view that rebound from 95.55 completed as a three-wave corrective move at 101.80.

Near-term outlook stays bearish while 55-day EMA around 100.04 caps recovery.

Next key level is around 97.94. This is an important technical confluence. It represents 61.8% retracement of the 95.55–101.80 rise, while sitting almost exactly on the 38.2% retracement of much larger advance from 70.68 in 2008 to 114.77 in 2022.

Firm break of 97.94 would put 95.55 back into focus.

Weekly chart strengthens that warning. DXY has fallen below 55-week EMA around 99.71, supporting view that decline from 110.17 remains incomplete. Break through 95.55 would resume that fall and target the 92.76 projection.

But monthly chart is where stakes become much larger.

DXY has again failed to sustain above 55-month EMA around 100.57. If decline eventually breaks through 95.55, Dollar Index would also threaten its multi-decade rising channel from 2008 low.

That would no longer be simply a short-term Dollar correction.

Fall from 114.77 could then be developing into a much larger correction of entire post-2008 bull trend, or potentially something more significant. In either case, 89.29, close to psychological 90 level, would become an important longer-term downside objective.

The distinction is crucial: 95.55 has not broken yet. It is the level that would turn current bearish setup into a much more serious structural signal.

EUR/USD 1.20 Is the Other Side of the Same Test EUR/USD offers traders a mirror image of DXY setup.

Pair has repeatedly struggled around psychological 1.20 area. That region also contains 1.2019, the 38.2% retracement of long decline from 1.6039 to 0.9534.

If DXY breaks decisively through 95.55, EUR/USD would likely be making its corresponding attempt through 1.20.

A clean breakout there would carry substantial medium-to-long-term significance. It would open the way toward 1.3554, the 61.8% retracement of 1.6039–0.9534 decline.

So two charts give traders essentially the same structural test:

DXY below 95.55.

EUR/USD above 1.20.

If both occur together, Dollar story would be moving beyond a reaction to one week’s Treasury headlines.

What Would Prove the Bearish Dollar Thesis Wrong? Convergence is powerful, but it is not proof of an inevitable Dollar crisis.

There are clear developments that would weaken the argument.

Most important would be actual fiscal consolidation. A legislated and independently scored package that materially reduces future deficits would address underlying borrowing requirement rather than maturity structure.

Hard revenue data could also validate Bessent’s optimism. Stronger tariff receipts or other revenue gains would improve fiscal arithmetic.

Growth is another route. If productivity and real activity accelerate enough to improve debt-to-GDP dynamics, “grow our way out” becomes an economic argument rather than a slogan.

Markets themselves will provide confirmation as well.

If DXY starts responding positively again to strong US data, higher yields or hawkish Fed signals and reclaims 100, immediate bearish case would weaken.

But failure to recover 100 on positive catalysts would keep warning alive.

A break of 97.94, followed by 95.55, would turn that warning into something much more serious.

Five Languages, One Question for Dollar No single voice in this debate is decisive.

UBS and Wellington explain mechanics. Treasury’s own advisory framework explains what buybacks were designed to do. Fitch shows fiscal arithmetic. Dalio and Dimon warn about consequences if debt burden keeps compounding. Dollar chart tells us how investors are beginning to position.

These arguments are not identical. They should not be treated as if they are.

But they overlap at one crucial point: buybacks can help Treasury manage market stress without solving reason that stress exists.

That is why DXY’s next move matters so much.

Holding 95.55 would leave current decline within a broader range. Breaking it would threaten a much larger technical structure, while EUR/USD would simultaneously be positioned for another attack on 1.20.

Treasury can rearrange duration. It can improve liquidity. It can buy time.

What markets are now asking is whether Washington can use that time to change fiscal trajectory before Dollar begins pricing a much bigger adjustment.

Key takeaways Canada inflation & BoC stance: July CPI accelerated to 3.0% YoY, pressuring USD/CAD in the short term, but the Bank of Canada maintains a cautious stance as underlying core metrics continue to moderate.Australian labor & RBA dilemma: A sharp contraction in employment pushed unemployment to 4.5%, yet sticky core inflation keeps the RBA constrained in a “higher-for-longer” stance at 4.35%.FOMC minutes & rate expectations: Despite hawkish July minutes, markets looked past the rhetoric toward cooler data, with FedWatch pricing for September rate targets rebounding into the 60%–70% range by late August.Major currency dynamics: Major pairs rallied against the U.S. dollar during the week of August 17–21, led by NZD/USD (+1.57%) and AUD/USD (+1.33%). Canada inflation acceleration & Bank of Canada policy stance For the week of August 17th, 2026, Statistics Canada released the July CPI report, showing headline inflation accelerating to 3.0% YoY—beating forecasts — driven by surging gasoline and travel costs, while underlying core metrics remained relatively subdued. In response, the Canadian dollar strengthened immediately, pushing USD/CAD down roughly 0.2% to 1.3850 on the day.

Canada CPI Source: Bloomberg Finance L.P. Past performance is not indicative of future results Despite the headline beat, Bank of Canada (BoC) policymakers maintain a cautious forward stance. The Governing Council is actively balancing near-term inflationary persistence—driven by upticks in the energy and services components—against emerging downside risks to domestic growth, including softer household consumption and elevated debt-servicing costs. While the 3.0% YoY CPI print temporarily suppresses immediate market expectations for aggressive monetary easing, underlying core metrics (CPI-median and CPI-trim) suggest that broader price pressures continue to moderate toward the 2% target band. Consequently, money markets are pricing in a higher probability of a prolonged policy hold, with rate-cut projections shifted further out along the yield curve as central bankers await further confirmation of sustained disinflation before committing to additional policy adjustments.

Australian labor cooling & RBA monetary policy dilemma This week’s Australian labor force data revealed a surprise cooling in the job market, as headline employment declined by 15,800 jobs in July, significantly missing market forecasts and reversing the previous month’s gain of 80,000 jobs. This contraction was driven entirely by a sharp reduction in part-time roles, which pushed the unemployment rate up to 4.5%—its highest level since late 2021—and contributed to a 0.6% drop in total hours worked. Consequently, the Australian dollar (AUD) faced downward pressure following the report, as investors interpreted the data as a sign of a weaker economic environment, leading the market to dial back expectations for further interest rate hikes from the Reserve Bank of Australia.

However, the initial downward pressure on the Australian dollar proved short-lived, as the currency subsequently staged a strong recovery alongside the broader rally against the U.S. dollar later in the week.

Australia CPI Source: Bloomberg Finance L.P. Past performance is not indicative of future results The Reserve Bank of Australia (RBA) finds itself navigating a classic monetary policy dilemma—managing a cooling labor market while stickier price pressures persist. With core inflation, trimmed mean, and weighted median elevated at around 3.6% and headline inflation at 3.8%, both remain above the bank’s 2%–3% target band. However, with the unemployment rate creeping up to 4.5% and net job growth turning negative in July, the RBA is constrained from hiking interest rates further without risking a sharper economic downturn. As a result, the RBA is likely to maintain a “higher-for-longer” policy hold at 4.35%.

FOMC minutes hawkishness & Fed rate probability shifts The release of the July FOMC meeting minutes revealed a distinctly hawkish division among Federal Reserve officials, highlighted by three dissents favoring an immediate 25-basis-point rate hike and strong warnings regarding upside risks to inflation. Despite this hawkish rhetoric, the foreign exchange market reacted with broad, modest U.S. dollar selling as traders largely dismissed the minutes as backward-looking. Investors prioritized subsequent economic data showing cooling inflation and job losses over the Fed’s July sentiments, shifting their focus toward upcoming commentary at the Jackson Hole Symposium for clearer forward-looking guidance.

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CME Fed watch tool - FOMC September 2026 meeting probabilities Source: CME Group Past performance is not indicative of future results The CME FedWatch tool chart shows that after plunging to a multi-month low near 20% in late July, the market-implied probability of a 350–375 bps target rate at the September 16, 2026, meeting rebounded sharply throughout August. The probability climbed back toward the 60%–70% range by August 21st, reflecting shifting interest rate expectations as traders recalibrated the likelihood of a Fed rate cut in response to incoming economic data and central bank communications over the month.

Major currency pair dynamics relative to the U.S. dollar TradingView currency performance Source: Tradingview.com Past performance is not indicative of future results Over the past trading week (August 17–21), major currencies rallied sharply against the U.S. dollar, driven by a broad mid-week greenback sell-off on August 19 as markets looked past hawkish Fed minutes toward cooler U.S. economic data. The New Zealand Dollar (NZD/USD) led gains across the board, extending its advance to +1.57% after recovering aggressively from early-week lows. The Australian Dollar (AUD/USD) followed with a +1.33% gain, while the Euro (EUR/USD) held solid strength at +1.01%. Meanwhile, the Canadian Dollar (CAD/USD) rose +0.82%, supported by earlier domestic inflation strength, and the British Pound (GBP/USD) settled at a +0.80% gain as major pairs maintained their elevated levels heading into the end of the week.

Conclusion In summary, the week of August 17–21 highlighted diverging monetary policy dynamics and shifting market expectations across major central banks. While Canada’s headline CPI uptick provides short-term support for CAD despite underlying disinflation, Australia’s cooling labor market contrasts with persistent core inflation, keeping the RBA on a cautious hold. Meanwhile, markets largely looked past hawkish FOMC minutes and priced in a higher probability of September Fed rate cuts, driven by softer economic indicators, driving broad gains across major currency pairs relative to the U.S. dollar.

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About the Author

Moheb Hanna Market Analyst

With over 15 years' experience in the forex markets, on both the research and client relations sides, Moheb specialises in technical, trade-focused market analysis. He has worked at a number of top financial institutions, publishing daily commentary and driving sales for retail and institutional clients. A CMT Charter member, Moheb holds a globally recognised CFTe designation.

With over 15 years' experience in the forex markets, on both the research and client relations sides, Moheb specialises in technical, trade-focused market analysis. He has worked at a number of top financial institutions, publishing daily commentary and driving sales for retail and institutional clients. A CMT Charter member, Moheb holds a globally recognised CFTe designation.

The USD/CHF advanced on Friday, registering a modest 0.07% gain, trading at 0.8010. During the week, the pair finished with losses of over 1.49%, triggered by a drop in US yields on Wednesday, as the US Treasury tries to cap elevated yields on the 30-year bond.

USD/CHF Price Forecast: Technical OutlookUSD/CHF price action shows some “sort” of consolidation, capped by the 50- and 100-day Simple Moving Averages (SMAs) at 0.8086 and 0.7976. Momentum shifted downwards as seen in the Relative Strength Index (RSI). 

Even though price action could’ve opened the door for a “mean reversion” trade after the sudden drop, the RSI suggests that bears are in charge and caution is warranted.

For a bearish continuation, the first support level for USD/CHF is 0.8000. Below the first support is the 100-day SMA, followed by the August 20 low of 0.7949, and then the 200-day SMA at 0.7933. A breach of the latter will expose 0.7900.

If USDCHF makes a U-turn and edges higher, the first resistance is the 50-day SMA at 0.8086. Above is 0.8100, followed by the August 13 high of 0.8147, before testing 0.8200.

USD/CHF Price Chart – Daily

USD/CHF daily chart Swiss Franc Price This week The table below shows the percentage change of Swiss Franc (CHF) against listed major currencies this week. Swiss Franc was the strongest against the US Dollar.

USDEURGBPJPYCADAUDNZDCHFUSD-0.97%-0.88%-0.21%-0.79%-1.15%-1.41%-1.34%EUR0.97%0.22%0.74%0.18%-0.24%-0.50%-0.38%GBP0.88%-0.22%0.59%-0.05%-0.45%-0.72%-0.65%JPY0.21%-0.74%-0.59%-0.61%-0.92%-1.21%-1.13%CAD0.79%-0.18%0.05%0.61%-0.34%-0.70%-0.60%AUD1.15%0.24%0.45%0.92%0.34%-0.27%-0.21%NZD1.41%0.50%0.72%1.21%0.70%0.27%0.07%CHF1.34%0.38%0.65%1.13%0.60%0.21%-0.07% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Swiss Franc from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent CHF (base)/USD (quote).