Spot gold daily chart shows larger trend structure. Source: TradingView First Ceiling, Then 200-Day Verdict If the session high at $4,398 is broken to the upside, Wednesday’s low becomes a key support level. Tuesday’s high of $4,464 can then be used as an initial upside target zone, since it is joined by a prior swing high at $4,450 and the 20-day moving average near $4,449. A downtrend line nearby adds to the cluster. Together, this confluence of potential resistance is the zone that must be recovered before gold can go higher. For now, Monday’s high of $4,472 can be used as a proxy for the top of the resistance zone.
How gold behaves from there will tell the next step. A decisive upside break above $4,472 would get gold back above the downtrend line and the 20-day moving average. Then it must contend with resistance near the 200-day moving average, currently at $4,533. The recent rally failed to hold above the 200-day moving average, which makes that area a more significant resistance zone and a bullish signal for the larger trend if it is reclaimed. The buyers who reversed Wednesday’s breakdown would then be testing the level that shows whether the larger uptrend is back in control.
The USD/CHF pair advances some 0.13% on Wednesday as the Greenback holds within familiar levels, after depreciating versus the Japanese Yen amid speculation of an intervention in the FX markets. This dragged the pair from around five-week highs to the 0.8120 area.
USD/CHF Price Forecast: Technical OutlookPrice action shows USD/CHF is poised to trade sideways after bouncing off a two-month low of 0.7949 on August 20, to current exchange rate levels. From a market structure perspective, the pair is on a corrective leg before extending the downtrend.
The Relative Strength Index (RSI) turned bullish, aiming higher and hinting at further upside.
For a bullish continuation, USD/CHF must clear the high of the day at 0.8156 ahead of challenging 0.8200. A decisive breakout will expose the current year high at 0.8207, followed by the psychological 0.8250 ahead of 0.8300.
On the other hand, if USD/CHF retreats to 0.8100, it opens the door for another lower leg. Below is the 50-day Simple Moving Average (SMA) at 0.8091, followed by the July 30 swing low of 0.8039. Once hurdled, the next stop is the 100-day SMA at 0.7990.
USD/CHF Price Chart – Daily
USD/CHF daily chart Swiss Franc Price Today The table below shows the percentage change of Swiss Franc (CHF) against listed major currencies today. Swiss Franc was the strongest against the New Zealand Dollar.
USDEURGBPJPYCADAUDNZDCHFUSD0.04%0.20%-0.94%-0.37%-0.36%0.70%0.15%EUR-0.04%0.16%-0.97%-0.41%-0.39%0.65%0.11%GBP-0.20%-0.16%-1.11%-0.57%-0.56%0.44%-0.05%JPY0.94%0.97%1.11%0.56%0.57%1.63%1.08%CAD0.37%0.41%0.57%-0.56%0.01%1.06%0.53%AUD0.36%0.39%0.56%-0.57%-0.01%1.02%0.53%NZD-0.70%-0.65%-0.44%-1.63%-1.06%-1.02%-0.54%CHF-0.15%-0.11%0.05%-1.08%-0.53%-0.53%0.54% 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).
Gold (XAU/USD) price rises over 1% on Wednesday as the Greenback softens amid speculation of an intervention to bolster the Japanese Yen (JPY), while US Treasury yields hold firm after weak US jobs data. At the time of writing, the XAU/USD pair trades at $4,373.
The Japanese Yen strengthened across the board, raising speculation that Japanese authorities may have intervened in the FX market or conducted a rate check. However, no official confirmation of either action was made.
XAU/USD climbs as softer Dollar offsets firm yields and Iran risksThe yellow metal remains bid as the US 10-year Treasury yield stays near Tuesday’s closing price of 4.79%. The US Dollar Index (DXY), which measures the performance of the American currency against six other currencies, is at 99.59, down 0.06%.
Recently, US President Donald Trump said that the US is “prepared to do another attack on Iran,” adding that the campaign “won’t continue for too long.“ Following the remarks, Oil prices resumed their uptrend, with West Texas Intermediate (WTI) up 0.10% at $90.86.
Despite this, US yields barely blinked as higher energy prices implied higher interest rates needed to tackle stubbornly sticky inflation in the US.
The Federal Reserve’s (Fed) Beige Book was just released; in it, the US central bank stated that economic activity increased modestly since early July, while overall employment rose slightly. Regarding inflation, prices rose in eight districts.
US data showed that private-sector hiring in August was weaker than expected, at 38K, compared with the forecast of 47K and down from 46K in July, according to the ADP Employment Change National report.
New York Fed President John Williams said that US bond yields aren’t driven by inflation expectations but rather reflect a solid economy. Williams stated that inflation is not out of control and that current monetary policy is in the right place to achieve price stability toward the Fed’s 2% goal.
Ahead, the US economic docket will feature the release of jobs data, the ISM Services PMI for August, followed by the Nonfarm Payrolls report on Friday.
XAU/USD technical outlook: Gold reclaims 100-day SMA, eyes on $4,400Gold price reclaimed $4,300, clearing the 100-day Simple Moving Average (SMA) at $4,361 at the time of writing. Despite this, which could open the door to further gains, short-term momentum remains bearish.
The Relative Strength Index (RSI) is below its 50-neutral level, indicating that sellers are in control, meaning that bullion’s path of least resistance is downwards.
For a bearish continuation, XAU/USD first support is $4,300. Once cleared, a move towards the 50-day SMA at $4,223 is on the cards. On further weakness, the $4,200 emerges as the next area of interest.
On the upside, if XAU/USD rallies past $4,400, this paves the way to challenge the $4,450 ahead of the $4,500 mark. A decisive breakout exposes the 200-day SMA at $4,531 ahead of $4,600.
Gold daily chart 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.
Swiss Franc Technical Forecast: USD/CHF Short-term Trade Levels
USD/CHF has rallied 2.6% from the August low, extending the recovery to a five-week high.
The break of the July downtrend is attempting to stabilize above the median line as the advance encounters its first meaningful resistance zone.
A sustained push higher would expose a renewed challenge of the yearly highs while failure to hold would raise the risk of a deeper pullback toward August support.
Swiss inflation and GDP data precede Friday’s U.S. employment report, highlighting event risk into the weekly close.
Resistance 8100/25 (key), 8200/15, 8333- Support 8041, 8009 (key), 7910/27
USD/CHF has staged an impressive recovery from the August lows, with a break of the July downtrend accelerating the advance to a five-week high. The move has strengthened the near-term technical backdrop as bulls attempt to establish a foothold above pivotal resistance. The focus heading into the weekly close is on whether buyers can sustain the breakout and force another challenge of the yearly highs or whether the latest push begins to lose traction. Battles lines drawn on the USD/CHF short-term technical charts heading into NFPs.
Review my latest Weekly Strategy Webinar for an in-depth breakdown of this USD/CHF setup and more. Join live on Monday’s at 8:30am EST.
Swiss Franc Price Chart – USD/CHF Daily
Chart Prepared by Michael Boutros, Sr. Technical Strategist; USD/CHF on TradingView
Technical Outlook: In last month’s Swiss Franc Short-term Outlook we noted that USD/CHF was, “approaching major technical resistance at the upper bounds of the yearly uptrend. From a trading standpoint, look to reduce long-exposure / raise protective stops on a stretch towards the 82-handle- losses would need to be limited to 8083 IF price is heading higher on this stretch..” USD/CHF registered an intraday high at 8207 three-days with an outside daily reversal off the high plunging more than 3.1%.
A rebound off channel support on August 20 has now broken above the July downtrend with the rally extending 2.6% off the lows. The bulls are trying to secure a pivot back above the median line of the yearly uptrend with immediate focus on the 8101/25 pivot zone- a region defined by the November / June high-day closes (HDC), the 61.8% extension of the 2022 decline, the August high close (HC), and the November high. The focus into the start of the month is on possible inflection off this zone and the bulls will need stabilize above the median to stay in control here.
Swiss Franc Price Chart – USD/CHF 240min
Chart Prepared by Michael Boutros, Sr. Technical Strategist; USD/CHF on TradingView
Notes: A closer look at Swisse price action shows USD/CHF breaking out of the July channel with price exhausting today at the 78.6% retracement of the decline off the yearly high at 8152. A break higher from here exposes key resistance at 8200/15- a region defined by the 100% extension of the January advance, the yearly high, and the 38.2% retracement of the 2025 decline. Note that the 75% parallel (daily chart) converges on this threshold over the next few weeks and a breach / close above this slope would be needed to fuel the next major leg of the advance. Subsequent resistance objectives are eyed at the upper parallel near 8300 and the 2023 low at 8333.
Initial support now rests back at 8101/24 and is backed by the weekly / monthly swing low at 8069. Note that the late-August support line converges on this level over the next few days. Key support rests with the January / March swing highs at 8041/42 and losses below this level would suggest a more significant near-term high is in place, and a lager reversal is underway. Subsequent support rests with the April high-day close (HDC) / July low at 8009 backed by the 200-day moving average and the objective yearly open at 7927/36.
Bottom line: USD/CHF has rallied to a five-week high with the bulls attempting to punch through a key pivot zone into the start of the month. From a trading standpoint, losses should be limited to 8069 IF price is heading higher on this stretch with a close above 8152 needed to fuel another run at the yearly highs. Look for another meaningful reaction on a test of the 82-handle for guidance IF reached.
The economic calendar heats up into the close of the week, with Swiss CPI and second-quarter GDP figures on tap tomorrow followed by the highly anticipated U.S. Non-Farm Payrolls report on Friday. While the Swiss data could generate near-term volatility, the broader focus remains firmly on the U.S. policy outlook as markets assess the timing of the Fed’s next move. Friday’s employment report will provide an important test for rate expectations, with attention then shifting back to inflation next week amid another round of key U.S. price data. Stay nimble into the releases and watch the weekly close for guidance. Review my latest Swiss Franc Weekly Forecast for a closer look at the longer-term USD/CHF technical trade levels.
USD/CHF Key Economic Data Releases
Economic Calendar - latest economic developments and upcoming event risk.
Active Short-term Technical Charts
Euro Short-term Outlook: EUR/USD Pullback Nears Pivotal Uptrend Support
Canadian Dollar Short-term Outlook: USD/CAD Recovery Reaches Downtrend Resistance
Australian Dollar Short-term Outlook: AUD/USD Breakout Extends to 10-Week Highs
British Pound Short-term Outlook: GBP/USD Bulls Confront Resistance at Three-Month Highs
Gold Price Short-term Outlook: XAU/USD Breakout Faces a Defining Test
US Dollar Short-term Outlook: USD Correction Pressures Pivotal Support
Japanese Yen Short-term Outlook: USD/JPY Defends the Uptrend as the Range Tightens
--- Written by Michael Boutros, Sr Technical Strategist
XAU/USD Current Price: $4,368 A suspected Bank of Japan intervention on the Yen weighed on the US Dollar.The Bank of Canada left rates unchanged, but opened the door for “multiple” rate hikes.XAU/USD bounced from a fresh one-month low, risk still skewed to the downside.The XAU/USD pair trades around $4,360, up on Wednesday after bottoming at $4,282 during Asian trading hours. The US Dollar (USD) maintained its positive tone throughout the first half of the day, but changed course early in the American session, helped by two external factors.
On the one hand, a sharp Japanese Yen (JPY) appreciation put pressure on the USD. Market participants suspect that yet another intervention took place as the USD/JPY pair briefly traded above the 160.00 mark, although there is no official confirmation. Still, the pair shed roughly 200 pips in a matter of hours, usually the result of some action from the Bank of Japan (BoJ).
On the other hand, the Bank of Canada (BoC) announced its monetary policy decision, leaving the policy rate unchanged at 2.25%, as expected. However, the Canadian Dollar (CAD) appreciated sharply after Governor Tiff Macklem's speech, in which he not only acknowledged the risks to the inflation outlook as a result of the Middle East conflict, but also said that multiple interest rate hikes should not be ruled out.
JPY and CAD strength weighed on the Greenback, while a bounce in stocks compounded the latter's near-term weakness.
The fundamental background, however, remains the same: Crude Oil prices remain near their recent highs following an escalation in the Middle East war. This, in turn, fuels concerns about mounting inflationary pressures across the globe.
XAU/USD Technical Outlook:In such a scenario, XAU/USD recent recovery does not erase prevalent downward pressure. The technical picture is bearish after the pair broke below $4,400.
In the four-hour chart, XAU/USD trades beneath the 20-period and 100-period Simple Moving Averages (SMAs) at $4,399.10 and $4,479.23, respectively, while remaining only supported by the 200-period SMA down at $4,305.43. The Relative Strength Index (RSI) indicator resumed its decline after correcting oversold conditions, while the Momentum indicator turned south below its midline, both reflecting sellers' dominance.
On the daily chart, XAU/USD struggles around its 100-day SMA at roughly $4,361, while still capped below the 20-day SMA near $4,448. The broader tone is neutral to slightly topside-capped, with the price sitting below the 200-day SMA around $4,531, and technical indicators stuck around their midlines.
On the topside, initial resistance is seen at the 20-period SMA at $4,399.10, with a stronger barrier at the 100-period SMA near $4,479.23, where a sustained break would be needed to ease the current downside pressure. On the downside, the 200-period SMA at $4,305.43 is the immediate support ahead of the mentioned weekly low. Once below the latter, the $4,200 threshold comes in sight.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Scotiabank strategists Shaun Osborne and Eric Theoret describe GBP/USD as soft but mid-pack within the G10, with domestic data and Bank of England (BoE) events limited ahead of Governor Bailey’s speech. They stress the role of political sentiment under PM Burnham in prior Pound strength, now challenged by higher Oil prices. Technically, the break of 1.35 refocuses attention on support in the mid‑1.34s and 1.33.
Political sentiment and Oil weigh on Pound"The GBP is soft, down 0.3% vs. the USD but still a mid-performer among the G10 in an environment of broad-based USD strength. Domestic releases have been limited and the BoE calendar is empty ahead of Friday’s speech from Gov. Bailey."
"Political developments have been equally limited, offering little to market participants in search of domestic drivers. We continue to highlight the importance of sentiment – specifically, politically-related sentiment – in driving the recent strength in the pound following the arrival of PM Burnham in late June."
"The shift had been clearly observed in risk reversals as the options market had faded its premium for protection against downside risk. However the latest surge in oil prices appears to be eroding this key source of support, and riskies are once again pricing a higher premium for downside protection. "
"Neutral/bearish – the RSI’s plunge into bearish territory has been swift however the momentum indicator is already in the mid-40s and spot’s defensive price action suggests little scope for near-term stabilization."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
A significant shift has begun to emerge around the strength of the Japanese yen in the short term. Over the last two trading sessions, USD/JPY has declined by nearly 1.00%, reflecting a notable recovery in the Japanese currency. For now, this selling pressure is primarily being driven by growing expectations that the Bank of Japan could accelerate the pace of interest rate hikes. As long as these expectations continue gaining traction in the market, it is possible that downside pressure on USD/JPY remains relevant during the coming sessions.
Is the Bank of Japan Turning More Aggressive?
Expectations surrounding the Bank of Japan have changed considerably in recent weeks. This shift has been largely driven by increasing expectations of a rate hike at the September meeting following recent comments from Kazuo Ueda, who emphasized that inflation is once again moving closer to the bank's 2.00% target.
In addition, several policymakers have suggested that not only could a rate hike be justified in September, but that further adjustments may also be necessary in the months ahead. As a result, markets are currently assigning more than an 80% probability to at least a 0.25% rate increase at the next meeting.
This development comes as a relative surprise because Japan still maintains one of the lowest interest rates among major central banks, currently around 1.00%. Until recently, the dominant view was that the Bank of Japan would remain focused on maintaining monetary stability. However, the latest narrative suggests the institution could become one of the more aggressive central banks over the coming months.
Over the longer term, this shift could also improve the relative attractiveness of yen-denominated assets compared with international alternatives, a dynamic that has been largely absent during the years of ultra-low interest rates in Japan.
This change is already being reflected in the Japanese bond market. 10-year government bond yields have shown a consistent recovery following recent comments and now trade above the 3.00% level, helping strengthen the appeal of yen-denominated investments.
However, it is important to note that this is occurring alongside rising U.S. Treasury yields, which have already climbed above 4.8%. As a result, while Japanese bonds are becoming more attractive, U.S. yields continue to provide a favorable differential for the dollar that could limit part of the yen's recent advance.
Source: TradingEconomics
It is also noteworthy that the yen's recovery is taking place despite the relative stability of the U.S. dollar. The DXY Index, which measures the dollar's performance against its major peers, continues to trade near the 100-point area without showing any meaningful loss of momentum.
This suggests that markets are placing significant importance on recent comments from the Bank of Japan and that, for now, expectations of a more restrictive monetary policy in Japan are having a greater impact than the stability currently observed in the dollar. Nevertheless, it remains important to consider that a stronger recovery in the U.S. currency could continue to limit part of the yen's recent gains.
Source: TradingEconomics
Taking all of this into account, it appears that the Bank of Japan's shift in tone has been enough to support a recovery in the Japanese currency over the short term. This dynamic could continue to favor downside pressure on USD/JPY as long as the dollar and U.S. bond yields do not accelerate their recovery more aggressively.
At the same time, it is important to recognize that a more hawkish stance from the Federal Reserve could once again increase the appeal of dollar-denominated assets. Under that scenario, part of the yen's recent strength could begin to moderate and the market could return to a more balanced phase around USD/JPY.
USD/JPY Technical Outlook
Source: StoneX, Tradingview
Lack of Direction Remains Relevant: After USD/JPY moved away from the major bullish trendline that dominated much of the price action over recent months, the market entered a more balanced phase. Despite the recent strengthening of the yen, a sufficiently strong directional structure has yet to emerge on the chart. Unless price manages to break through important technical levels, this lack of direction may continue to dominate and could even open the door to a more defined period of range-bound trading.
RSI: The RSI remains slightly below the neutral 50 level. However, this behavior does not yet indicate aggressive selling pressure. Instead, it continues to reflect a relatively balanced environment between buyers and sellers over the last fourteen sessions. This reading supports the possibility that a period of indecision remains relevant for price action.
MACD: A similar picture can be observed in the MACD, where the histogram continues to fluctuate around the neutral 0 line. This behavior reflects balance in the average strength of short-term moving averages and reinforces the possibility that a neutral market environment remains an important feature of the chart in the coming sessions.
Key Levels to Watch:
160.889 – Key Resistance: This level coincides with the most relevant 61.8% Fibonacci retracement on the chart as well as the 50-period moving average. Price action that manages to establish itself above this area could favor the emergence of a stronger bullish bias and restore the relevance of the previous bullish structure that dominated months ago.
159.676 – Nearby Barrier: This level represents one of the main equilibrium zones on the chart and aligns with several important retracement areas from previous sessions. It could become the key reference to monitor should bullish corrective moves begin to emerge in the short term.
157.280 – Key Support: This area corresponds to recent lows and also aligns with the 200-period Simple Moving Average and the 23.6% Fibonacci retracement of the most relevant move on the chart. A sustained break below this level could reinforce a more dominant bearish bias and potentially pave the way for a broader downtrend over the coming weeks.
Written by Julian Pineda, CFA, CMT – Market Analyst
USDJPY drops sharply in early US trading on Wednesday (down over 1%) after the pair hit the highest in almost five weeks (160.39) but bulls repeatedly failed to sustain gains above psychological 160 barrier.
The latest hawkish shift from BoJ officials in calling for quick action to support weakening yen in the situation of increasing inflationary risks, adds to growing expectations that the central bank may raise rates as early as this month.
On the other hand, today’s sharp rise of Japanese currency sparked speculation that Japanese authorities have intervened again after repeated attacks at 160 threshold (although the previous intervention started from the levels near 164).
The pair fell to 158.20 on today’s sharp fall (trendline support), with quick bounce above cracked significant support at 158.42 (Fibo 38.2% of 155.22/160.39 rally / 200DMA) suggesting that bears may have reached firmer ground (in case of daily close above 158.42).
The structure on daily chart weakened, as RSI slid below 50 zone and 14-d momentum entered negative territory, developing signal that the price may fall further (sustained break of 158.42 is required to signal bearish continuation) after limited upticks (should be capped under 159.17 (broken Fibo 23.6% / 20DMA).
Traders will continue to focus on comments from Japanese and US financial authorities for fresh signals.
We saw a bit of recovery in the stock market since the US open, with the dollar easing lower on suspected BoJ intervention in the USD/JPY helping to calm the nerves. That in turn helped to provide some support for gold, too.
Scotiabank strategists Shaun Osborne and Eric Theoret note EUR/USD has slipped to the upper 1.15s, with sentiment turning bearish despite supportive yield spreads. They link the renewed deterioration to rising Oil prices and concerns over Euro area terms of trade. Spot is now drifting below their narrow fair value estimate of 1.1619, and technical focus has shifted toward lower support levels.
Bearish sentiment outweighs spread support"The EUR is soft, down a modest 0.2% vs. the USD with a drift to a fresh two week low into the upper-1.15 area. The domestic release calendar has once again quieted down, forcing market participants to focus on broader themes."
"Measures of EUR sentiment have shifted bearishly over the past week or so, ending a brief period of bullish-leaning risk reversals in mid/late August."
"The renewed deterioration looks to have coincided with the latest recovery in oil prices, sparking concerns about the euro area’s terms of trade as a major energy importer. "
"The support offered by higher yield spreads appears to be overwhelmed by the turn in sentiment, with spot drifting below our narrow FV estimate at 1.1619."
"EUR/USD short-term technicals: Neutral – the RSI is still close to the neutral threshold at 50 but it has just – barely – broken below into bearish territory. The latest bearish turn in EUR has shifted our focus to the downside, and we now look to near-term support at 1.1520 following the latest drift below 1.1580."
"We also note the potential for additional support closer to the 50 day MA (1.1499). Near-term resistance is expected in the 1.16/1.1620 range. The medium-term range from mid-2025 remains flat with wide congestion centered around the mid-1.16s."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
Gold defends its crucial 200-day EMA as traders weigh elevated US rates and Friday’s jobs report, which could trigger the next major price move.
Gold Technical Analysis
Daily price chart for Gold futures displaying support levels at 4,500.0 and 4,000.0 with the 10-year Treasury yield at 4.788%. Source: TradingView The gold market found itself to be a little bit interesting during the session as we fell towards the 200-day EMA only to bounce. This is an area that technical traders will be watching, as it is such a big technical indicator.
This is going to be an interesting market to watch during the session as interest rates, of course, are elevated in America, and the jobs number coming out on Friday could have a major part to play as to where we go next. After all, traders will continue to question what the Fed may or may not do, and with that, it will have a major influence on gold. This is probably the whole story at the moment, and traders are trying to get a grip on what happens next through that prism.
Technical Outlook and Key Moving Averages Bouncing from the 200-day EMA is a strong sign from a technical analysis standpoint, so it has that going for it. A breakdown below the 200-day EMA would be a weak sign from a technical analysis standpoint. So, we’ll have to see how that plays out, but I’m watching this very closely.
Ultimately, we’re trying to decide whether or not the Federal Reserve is going to continue to tighten or if it’s going to be a situation where the Federal Reserve gets a little bit of cover from a weak jobs number. The next couple of days will potentially be somewhat neutral, but once we get the jobs report, this market could see a lot of volatility, depending on what the numbers look like.
If you’d like to know more about how to trade gold and silver, please visit our educational area.
TD Securities’ Ryan McKay and Bart Melek highlight that upcoming US Non-farm Payrolls (NFP) and a renewed hawkish Fed tone are critical for Gold, with prices near CTA (Commodity Trading Advisors) selling thresholds around $4,300/oz. Their simulations show further declines toward $4,200–$4,100/oz could push CTA positioning close to flat, though they see limited material downside longer term as the precious metals backdrop improves.
Gold nears key CTA sell triggers"Economic data becomes increasingly important for precious metals, with gold at risk of CTA selling."
"Non-farm payrolls this Friday will be the next piece of data with keen interest for precious metals given the renewed hawkish tone from the Fed and the latest escalation in the energy market."
"Price reaction may be more prone to the downside on potential beats in the data with gold nearing some CTA selling levels near $4,300/oz and our pricing simulations suggesting a further downward trend toward $4200-$4100/oz would see positioning reduced back to near flat into next week."
"Hike pricing has increased to over two hikes in 2027 again, and we have argued the recent rally in the yellow metal was too early due to these lingering inflation concerns."
"However, looking forward, we do not anticipate material downside as the landscape for precious metals has improved amid a renewed dollar debasement theme, while Fed hikes remain far from certain."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
Canadian Dollar Technical Outlook: USD/CAD Multi-Timeframe Analysis
The Canadian dollar has weakened as dollar CAD rebounded more than 1.5% off its monthly low into a pivot zone where three time frames converge. Michael Boutros, StoneX Media Senior Market Analyst, walks through the weekly, daily and four hour structure in dollar CAD and maps the event risk sitting on top of it. The U.S. dollar has been catching a bid as rising prices fuel concerns about the inflationary outlook, even with markets pricing roughly two thirds odds of a Federal Reserve move on rates next month. The Bank of Canada rate decision and U.S. nonfarm payrolls land in the same week, and payrolls carries the most weight for Federal Reserve pricing after Jackson Hole.
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.
USD/CAD Key Economic Data Releases
Economic Calendar - latest economic developments and upcoming event risk.
Active Short-term Technical Charts
Euro Short-term Outlook: EUR/USD Pullback Nears Pivotal Uptrend Support
Canadian Dollar Short-term Outlook: USD/CAD Recovery Reaches Downtrend Resistance
Australian Dollar Short-term Outlook: AUD/USD Breakout Extends to 10-Week Highs
British Pound Short-term Outlook: GBP/USD Bulls Confront Resistance at Three-Month Highs
Gold Price Short-term Outlook: XAU/USD Breakout Faces a Defining Test
US Dollar Short-term Outlook: USD Correction Pressures Pivotal Support
Japanese Yen Short-term Outlook: USD/JPY Defends the Uptrend as the Range Tightens
--- Written by Michael Boutros, Sr Technical Strategist
EUR/USD, USD/CAD and USD/CHF approach key technical levels as traders track US yields and prepare for Friday’s potentially market-moving jobs data.
In this article:EUR/USD
+0.01%
EUR/USD ForecastUSD/CAD
-0.12%
USD/CAD ForecastUSD/CHF
+0.15%
EUR/USD Technical Analysis
EUR/USD price chart displaying trading near 1.15811 with the 10-year Treasury yield at 4.780%. Source: TradingView The euro has been pretty negative in the early part of the session, but we are starting to turn things around a little bit here as we head into the US session. With this, I think we have to look at this as a market that may try to recover a little bit.
With interest rates in America drifting lower, I’m still going to watch the 1.16 level. I think that’s an area that could end up being a little bit of a barrier. I still prefer the US dollar over the euro. A nice bounce here, signs of exhaustion, would be a classic continuation play.
USD/CAD Technical Analysis
USD/CAD price chart with the 50-period EMA at 1.38975 and 200-period EMA at 1.38748. Source: TradingView The US dollar has been strong against the Canadian dollar, and I think that probably continues. So, I’ll be watching the 1.3910 level for a potential bounce that I can take advantage of.
In this environment, the trade war between the United States and America continues to be a major factor. Plus, we have to keep in mind that both of these countries release their jobs numbers on Friday, so we could get a little bit of a wiggle here. I plan on taking advantage of it.
USD/CHF Technical Analysis USD/CHF price chart showing the 200-period EMA at 0.80766 and Fibonacci retracement levels. Source: TradingView In the US dollar against the Swiss franc pair, this has been a long-term holding of mine for some time. I think we have a situation here where traders will continue to look at this as a buy-on-the-dip scenario right around 0.8120 and 0.81. Both areas I’m looking to buy some type of bounce if I get the opportunity. The 0.8160 level above is short-term resistance that, if broken, could get a bit of FOMO trading in this pair for short-term traders to join the trend.
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Chris is a proprietary trader with more than 20 years of experience across various markets, including currencies, indices and commodities. As a senior analyst at FXEmpire since the website’s early days, he offers readers advanced market perspectives to navigate today’s financial landscape with confidence.
Technical Outlook and Key Silver Levels The US dollar shrinking helps as well, so pay attention to that. But ultimately, we’re sitting right here at an area where you would expect to see a certain amount of support anyway, so it’s not a huge surprise. Whether or not we get momentum, that’s a completely different question.
But clearly, it looks like the selling has at least abated a bit for the short term, and this is the first step in trying to turn things around. Hesitation is a word I could use at the moment here.
Friday’s jobs number will loom large here. If we get an extraordinarily weak jobs number, traders may start to try to price in the idea that the Federal Reserve may not be able to tighten any further. And if that’s the case, things could get interesting here.
4 Hour Chart by www.skcharting.comCurrent market structureGold remains in a clear corrective bearish structure across 4 Hour and Day time frames. Price has broken below the major 100-day Simple Moving Average and continues to form lower highs and lower lows.
The latest decline has brought XAU/USD Spot Gold prices to a multi week low of $4282 according to investing.com data.
Strong and persistent fall in prices have created oversold conditions in small time frames which is being reflected in current rebound attempts testing $4379, precise $98 bounce back off the lows.
Fundamental analysisUSD and Treasury yields remain the key headwinds. The U.S. 10Y yield has approached 4.82%, while DXY is near 99.82.
Renewed US–Iran tensions have pushed oil prices higher, reviving inflation concerns and reducing expectations for easier Fed policy.
August ADP private payrolls increased only 38K vs 47K expected, suggesting some labour-market cooling and potentially limiting the bearish pressure from Fed expectations.
Friday's US NFP remains the major near-term volatility catalyst.
Fundamental bias: Neutral-to-bearish, until yields/USD ease materially.
Technical analysisH1: Bearish, but short-term selling is stretched. RSI(14) ≈ 47.
H4: Strong bearish momentum; price remains below major moving averages. RSI(14) ≈ 28, indicating oversold conditions and increasing rebound risk.
D1: Medium-term structure has turned corrective/bearish after rejection from the $4,700+ zone. Price remains below the key long-term trend area around $4,480–4,530.
Daily Spot Gold (XAU/USD) Spot gold is edging higher Wednesday after rebounding from an early session setback. The main trend changed to down earlier today when sellers took out the swing bottom at $4,311.04, but new buyers may have emerged on the test of a key retracement zone.
The long-term range is $3,942.10 to $4,697.11. Its 50% to 61.8% retracement zone is $4,319.60 to $4,230.51. Today’s rebound came from a trade to $4,282.62, which fell inside the zone. To some traders, this is a value zone.
Adding to concerns about heightened volatility is the fact that Spot gold is trading under 200-day moving average resistance at $4,530.71 and nearing 50-day moving average support at $4,222.93.
The early price action suggests trader reaction to the 50% level at $4,319.60 will determine the direction of the market into the close. A sustained move over this level could lead to a strong rally into the close, while failure to hold it would put the $4,230.51 to $4,222.93 support cluster back on the radar.
What to Watch The rate trade stays pointed against gold until the data changes it. Warsh and Barr both said this week the Fed has more work to do. The 10-year pulled back from 4.814% but is still near a multiyear high. The dollar index is at 99.67. Crude is above $90 WTI and near $95 Brent. The geopolitical bid from the Middle East conflict is going to the dollar, not the metal. Friday’s payrolls report at 56,000 expected is the number that can either keep the 68% September odds in place or force a repricing. The rate pressure holds until a soft jobs number gives buyers a reason to step back in.
Gold bounced from $4,282.62 inside the long-term retracement zone at $4,319.60 to $4,230.51. The main trend turned down Wednesday when sellers took out $4,311.04. The 200-day moving average at $4,530.71 is resistance above. The trade stays bearish while gold sits under $4,319.60. A close above that level is the first sign value buyers are taking over. A break through the 50-day at $4,222.93 opens the support cluster down to $3,942.10. The 200-day break from Friday is still the damage running this market. Wednesday’s bounce has not undone it.
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Sources: World Silver Survey 2026, Appendix 14, Metals Focus and the Silver Institute The rows add to 846.7 Moz against a stated total of 846.6 Moz, and the percentages to 99.9%, both from rounding in the survey’s own appendix.
Only 26.1% of the world’s mined silver comes from mines that exist to produce silver. The rest arrives as a credit alongside something else, and the largest single source is lead and zinc mines at 249.1 Moz. When a zinc mine decides how much ore to process, it is also deciding, without thinking about it, how much silver reaches the market that year.
That is why the price signal breaks. A higher silver price is supposed to bring out more supply. It cannot do much when nearly three quarters of the metal is produced by operators whose budgets, mine plans and board decisions all turn on the price of something else.
From Company Filings to a Global Data Series Until late August, that argument rested on individual company filings: a seismic event at a Swedish mine, an ore-mix change at a Peruvian one, a closure in Australia. All of it real, none of it adding up to a measurement of the whole market.
Then the International Lead and Zinc Study Group published its first-half 2026 data. World zinc mine production fell 2.6%. World lead mine production fell 3.0%. The two metals that between them account for the largest single source of byproduct silver fell together in the same six months, with the declines concentrated in the biggest producers and only partly offset by increases elsewhere.
Sources: ILZSG August 2026 press release | World Silver Survey 2026, Metals Focus and the Silver Institute The study group measures lead and zinc tonnage. It does not measure silver. The table above applies those percentage changes to last year’s silver base, which makes it a scenario rather than a measurement, and the midpoint is a plain average of the two rather than a silver-weighted figure. Silver grades vary between mines, and they do not always move with tonnage.
Boliden’s revised plan for Garpenberg shows why that caveat is needed. After a seismic event in March, 2026 guidance moved to 1.5 million tonnes milled at 100 grams of silver per tonne, from 3.7 million tonnes at 95 grams. Tonnage fell 59% while the silver grade guidance went up. The measured figure for 2026 arrives in next year’s survey, not this one, and I will record it in the Silver Catalyst when it does, whichever way it goes.
What This Means to Silver Investors On the supply side this is good for silver, and it is worth being precise about which part is good.
The mechanism now has better evidence behind it. Two mine supply series falling together, in the ore types that carry the most byproduct silver, is the first time this argument has rested on a primary global statistical release rather than on a run of company disclosures. A record-low negative treatment charge is a market price saying the same thing.
The scale is smaller than the headline suggests. Roughly 7 Moz annualised at the midpoint is 0.83% of the 844.1 Moz of mine supply that Metals Focus and the Silver Institute forecast for 2026. It does not break the market this year, and it should not be presented as though it does.
What it does change is the shape of the problem. The market is running into a sixth consecutive year of structural deficit, forecast at 46.3 Moz for 2026 by Metals Focus and the Silver Institute. The ordinary way a shortage resolves is that a higher price pulls out more supply. This data shows why that route is partly closed: a higher silver price does not directly determine output at these lead and zinc operations, because none of the people running them is deciding anything based on it.
The honest counterweight is that Western inventories have not tightened. COMEX registered stock rose over the past month, London vaults built for a third consecutive month to 28,213 tonnes at the end of July, and the September futures contract reached first notice day without visible stress. Whatever is happening in the ore is not yet showing up in the metal that Western buyers can touch. That gap is the thing to watch, and it is why the Convergence Score I publish in each issue records evidence against the argument in the same place as evidence for it. It did not move this time, for exactly that reason.
Byproduct dependency is one dimension of the 100-catalyst framework I analyze in Silver Rising, alongside the five other Deep Dives in this issue of the Silver Catalyst newsletter. Get full Silver Catalyst Newsletter and Silver Rising book for today.
EUR/USD consolidates its daily losses during American trading hours on Wednesday as the US Dollar (USD) holds firm, supported by hawkish Federal Reserve (Fed) expectations and escalating tensions in the Middle East. However, weaker-than-expected United States (US) labour market data and a modest pullback in US Treasury yields limit the Greenback’s advance. At the time of writing, the pair trades around 1.1580, down -0.11% on the day.
The ADP Employment Change showed that US private-sector payrolls increased by 38K in August, below market expectations of 47K and the upwardly revised July increase of 46K. The figures point to slowing hiring ahead of Friday’s Nonfarm Payrolls (NFP).
US Treasury yields ease across the curve on Wednesday but remain close to recent highs. The benchmark 10-year yield trades around 4.78% after briefly touching 4.81%, its highest level since October 2023. Meanwhile, the US Dollar Index (DXY), which tracks the Greenback’s value against a basket of six major currencies, trades around 99.74 after reaching a two-week high near 99.87.
New York Fed President John Williams said on Wednesday that “yields are rising on a strong economy and strong outlook,” adding that they “don’t seem to be driven by the inflation outlook.” Williams noted that “there is a correlation between bond yields and the Middle East conflict.”
The broader outlook continues to favour the Greenback as traders increase bets that the Fed could raise interest rates as soon as September, particularly after Fed Chair Kevin Warsh adopted a tougher stance on inflation at the Jackson Hole Symposium last week. According to the CME FedWatch tool, the probability of a rate hike at the September 15-16 meeting stands at around 70%, up from 36% a week ago.
Escalating hostilities between the US and Iran are also supporting the Greenback while weighing on the Euro. The latest exchange of strikes has pushed Oil prices higher, fuelling inflation concerns and raising expectations that major central banks could keep monetary policy restrictive for longer.
Against this backdrop, the European Central Bank (ECB) is widely expected to raise its deposit rate by 25 basis points to 2.50% at its September 9-10 meeting, marking its second increase this year. Preliminary Eurozone inflation data for August showed that the Harmonized Index of Consumer Prices (HICP) accelerated to 3.3% YoY from 2.9% in July, strengthening the case for another rate hike. Looking ahead, the Eurozone Producer Price Index (PPI) is due on Thursday, followed by Retail Sales data on Friday.
Economic Indicator Nonfarm Payrolls The Nonfarm Payrolls release presents the number of new jobs created in the US during the previous month in all non-agricultural businesses; it is released by the US Bureau of Labor Statistics (BLS). The monthly changes in payrolls can be extremely volatile. The number is also subject to strong reviews, which can also trigger volatility in the Forex board. Generally speaking, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish, although previous months' reviews and the Unemployment Rate are as relevant as the headline figure. The market's reaction, therefore, depends on how the market assesses all the data contained in the BLS report as a whole.
Read more.
America’s monthly jobs report is considered the most important economic indicator for forex traders. Released on the first Friday following the reported month, the change in the number of positions is closely correlated with the overall performance of the economy and is monitored by policymakers. Full employment is one of the Federal Reserve’s mandates and it considers developments in the labor market when setting its policies, thus impacting currencies. Despite several leading indicators shaping estimates, Nonfarm Payrolls tend to surprise markets and trigger substantial volatility. Actual figures beating the consensus tend to be USD bullish.
Peru's Antamina produced 62% less zinc last quarter, not because the orebody ran out but because the mine plan called for copper, and the silver in that ore left with it.
That is the central problem with silver supply, visible in one mine. Nobody at Antamina decided to produce less silver. They decided to feed the mill a different rock, and 73.9% of the world's mined silver comes out of decisions like that one. On August 26 the International Lead and Zinc Study Group published data that puts a global figure on the metals silver rides along with.
Most silver is mined by companies that are not looking for silverStart with where silver actually comes from, because the split is not what most silver marketing implies.
Sources: World Silver Survey 2026, Appendix 14, Metals Focus and the Silver Institute
The rows add to 846.7 Moz against a stated total of 846.6 Moz, and the percentages to 99.9%, both from rounding in the survey's own appendix.
Only 26.1% of the world's mined silver comes from mines that exist to produce silver. The rest arrives as a credit alongside something else, and the largest single source is lead and zinc mines at 249.1 Moz. When a zinc mine decides how much ore to process, it is also deciding, without thinking about it, how much silver reaches the market that year.
That is why the price signal breaks. A higher silver price is supposed to bring out more supply. It cannot do much when nearly three quarters of the metal is produced by operators whose budgets, mine plans and board decisions all turn on the price of something else.
From company filings to a global data seriesUntil late August, that argument rested on individual company filings: a seismic event at a Swedish mine, an ore-mix change at a Peruvian one, a closure in Australia. All of it real, none of it adding up to a measurement of the whole market.
Then the International Lead and Zinc Study Group published its first-half 2026 data. World zinc mine production fell 2.6%. World lead mine production fell 3.0%. The two metals that between them account for the largest single source of byproduct silver fell together in the same six months, with the declines concentrated in the biggest producers and only partly offset by increases elsewhere.
Two details give that more weight than a single half-year print usually deserves.
The first is that it reverses direction. The same monthly series had recorded 1.1% growth through May, so this is a turn rather than a continuation. EBC, reading the same data, puts the largest zinc reductions at Antamina in Peru, Garpenberg in Sweden and Red Dog in the United States, with Australia's Lady Loretta closing at the end of 2025 removing more tonnage.
The second is a price. Spot treatment charges for imported zinc concentrate in China reached a record low near minus $117.50 a dry tonne in August, on Shanghai Metals Market's index, against an $85 annual benchmark. A treatment charge is what a smelter earns for turning ore into metal. When it goes negative, the smelter is paying the miner for the right to process the ore, and its margin then depends on byproducts including silver rather than on the fee itself. That is what a genuine shortage of concentrate looks like when it shows up in a number rather than in commentary.
What that is worth in ounces, and what it is notHere is the arithmetic, with a caution attached that matters as much as the figures.
Sources: ILZSG August 2026 press release | World Silver Survey 2026, Metals Focus and the Silver Institute
The study group measures lead and zinc tonnage. It does not measure silver. The table above applies those percentage changes to last year's silver base, which makes it a scenario rather than a measurement, and the midpoint is a plain average of the two rather than a silver-weighted figure. Silver grades vary between mines, and they do not always move with tonnage.
Boliden's revised plan for Garpenberg shows why that caveat is needed. After a seismic event in March, 2026 guidance moved to 1.5 million tonnes milled at 100 grams of silver per tonne, from 3.7 million tonnes at 95 grams. Tonnage fell 59% while the silver grade guidance went up. The measured figure for 2026 arrives in next year's survey, not this one, and I will record it in the Silver Catalyst when it does, whichever way it goes.
What this means to Silver investorsOn the supply side this is good for silver, and it is worth being precise about which part is good.
The mechanism now has better evidence behind it. Two mine supply series falling together, in the ore types that carry the most byproduct silver, is the first time this argument has rested on a primary global statistical release rather than on a run of company disclosures. A record-low negative treatment charge is a market price saying the same thing.
The scale is smaller than the headline suggests. Roughly 7 Moz annualised at the midpoint is 0.83% of the 844.1 Moz of mine supply that Metals Focus and the Silver Institute forecast for 2026. It does not break the market this year, and it should not be presented as though it does.
What it does change is the shape of the problem. The market is running into a sixth consecutive year of structural deficit, forecast at 46.3 Moz for 2026 by Metals Focus and the Silver Institute. The ordinary way a shortage resolves is that a higher price pulls out more supply. This data shows why that route is partly closed: a higher silver price does not directly determine output at these lead and zinc operations, because none of the people running them is deciding anything based on it.
The honest counterweight is that Western inventories have not tightened. COMEX registered stock rose over the past month, London vaults built for a third consecutive month to 28,213 tonnes at the end of July, and the September futures contract reached first notice day without visible stress. Whatever is happening in the ore is not yet showing up in the metal that Western buyers can touch. That gap is the thing to watch, and it is why the Convergence Score I publish in each issue records evidence against the argument in the same place as evidence for it. It did not move this time, for exactly that reason.
Byproduct dependency is one dimension of the 100-catalyst framework I analyze in Silver Rising, alongside the five other Deep Dives in this issue of the Silver Catalyst newsletter. If you've at least considered investing in silver, I strongly encourage you to sign up, because it takes just $1 to get both. Get full Silver Catalyst Newsletter and Silver Rising book for $1 today.
Silver (XAG/USD) rebounds on Wednesday, trading around $64.30 at the time of writing, up 0.32% on the day after recovering from earlier losses. The precious metal finds some support from weaker-than-expected United States (US) employment data, although elevated US Treasury yields and expectations of tighter monetary policy continue to limit its upside.
The latest labor-market figures provide some relief for Silver. The Automatic Data Processing (ADP) Employment Change report shows that the US private sector added 38K jobs in August, below market expectations of 47K and the previous increase of 46K. The softer reading adds to signs of cooling labor demand and could complicate the case for additional monetary tightening.
However, expectations surrounding the Federal Reserve (Fed) remain broadly hawkish. Markets see a roughly 64% chance that the central bank will raise interest rates at its September 15-16 meeting, according to the CME FedWatch tool, compared with 36% a week earlier.
Higher rate expectations have pushed US Treasury yields sharply higher, creating a significant headwind for Silver as a non-yielding asset. The benchmark 10-year US Treasury yield reached 4.81% on Wednesday, its highest level since 2023, before easing modestly.
At the same time, rising tensions in the Middle East have driven Oil prices higher, adding another layer of uncertainty to the inflation outlook. Persistent energy-driven price pressures could encourage the Fed to maintain a restrictive stance for longer, potentially keeping Treasury yields elevated and limiting demand for precious metals.
The US Dollar (USD) also remains supported by the prospect of higher interest rates, although disappointing employment figures prevent the Greenback from gaining stronger momentum.
Against this backdrop, Silver's rebound remains caught between weakening US labor-market signals and persistent expectations of tighter Fed policy. Investors will now turn their attention to Friday's Nonfarm Payrolls (NFP) report, which could provide further clues on the strength of the US labor market and reshape expectations for the Fed's September decision.
XAG/USD technical analysis
In the one-hour chart, XAG/USD trades at $64.36, retaining a bearish near-term tone as it holds below the 100-hour simple moving average (SMA) at $66.81 and the 200-hour SMA at $67.80. This configuration suggests the recent bounce is a correction within a broader downswing, with the cluster of moving averages above price reinforcing the cap on recovery attempts. The Relative Strength Index (RSI) at 48.75 sits just below the neutral line, hinting at easing downside pressure but not yet signaling a decisive shift in momentum.
On the topside, immediate resistance emerges at $66.70, ahead of the horizontal barrier at $67.50, while the 100-hour SMA at $66.81 and the 200-hour SMA at $67.80 stack additional supply if bulls attempt a stronger rebound; a sustained move above these levels would be needed to alleviate the current bearish bias and expose the higher resistance at $71.12. On the downside, initial support is seen at $63.32, with further cushions at $62.19 and $60.87, where buyers would likely look to slow or halt any renewed decline.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Market selloff resumed yesterday while Gold managed to fell below support 4310. As we see over the chart, market facing resistance zone around 4345-75 where as long as market keep holding trades below it more drops will be expected toward 4200-20 support zone Above 4375 more advance toward 4475 is likely SUPPORT RESISTANCE LEVEL1 […]
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Orbex Group Limited is the holding company of Orbex Global Limited, Orbex Limited is an affiliate with Orbex Global Limited. Orbex Global Limited is authorized and regulated by Mauritius Financial Services Commission “FSC” (View License). Orbex.com is owned by Orbex Group Limited and is operated by Orbex Global Limited with registered address: Ground Floor, The Catalyst, Silicon Avenue, 40 Cybercity, 72201 Ebène, Republic of Mauritius
Risk Warning: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange, you should carefully consider your investment objectives, level of experience, and risk appetite. There is a possibility that you may sustain a loss of some or all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts. Orbex Global does not offer its services to residents of certain jurisdictions such as Mauritius, USA, and North Korea.
Orbex Group Limited is the holding company of Orbex Global Limited, Orbex Limited is an affiliate with Orbex Global Limited. Orbex Global Limited is authorized and regulated by Mauritius Financial Services Commission “FSC” (View License). Orbex.com is owned by Orbex Group Limited and is operated by Orbex Global Limited with registered address: Ground Floor, The Catalyst, Silicon Avenue, 40 Cybercity, 72201 Ebène, Republic of Mauritius
Risk Warning: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange, you should carefully consider your investment objectives, level of experience, and risk appetite. There is a possibility that you may sustain a loss of some or all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts. Orbex Global does not offer its services to residents of certain jurisdictions such as Mauritius, USA, and North Korea.
The British Pound (GBP) is down 0.1% to near 1.3500 against the US Dollar (USD) during the European trading session on Wednesday. The GBP/USD pair drops as the US Dollar extends its advance, with market participants pricing in a 25 basis points (bps) interest rate hike by the Federal Reserve (Fed) in the policy meeting this month.
At the time of writing, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, trades 0.13% higher to near 99.78. Read more...
British Pound declines to near 1.3500 as US-Iran tensions riseThe GBP/USD pair declines to near 1.3500 during the early European trading hours on Wednesday. Ongoing tensions in the Middle East provide some support to a safe-haven currency such as the US Dollar (USD) against the British Pound (GBP). All eyes will be on the US August jobs report later on Friday.
CNBC reported that the US and Iran traded a new round of attacks Tuesday, with American forces striking Iranian targets around the critical waterway and Tehran saying it had launched a retaliatory operation targeting US interests across the region. Read more...
GBP/USD Price outlook: British Pound/US Dollar navigating between arc levelsOverview: Based on Arc Cycle Analysis applied to the 30m chart, British Pound/U.S. Dollar is trading between the 0.5 Arc and 0.382 Arc within the current Arc Cycle. Price has cleared the 0.5 Arc boundary and is progressing toward the 0.382 Arc, suggesting continued movement toward the next Arc boundary.
Price is trading between the 0.5 Arc and the 0.382 Arc, indicating that the market is progressing through the current Arc Cycle toward the next Arc boundary. If momentum continues, the preferred scenario is continued movement toward the target 1.3527 price. Read more...
The gold price has fallen below $4,310, but UniCredit sees structural demand lifting bullion into a $4,400–$5,200 range by year-end. The gold price has dropped below $4,310 an ounce after a 48-hour decline of almost 3%, placing UniCredit’s upgraded forecast under immediate pressure.
Spot gold fell 2.74% on Tuesday and slipped another 0.43% to $4,309.40 by Wednesday morning.
The decline followed a surge in oil prices and global bond yields, with investors increasing their expectations for further Federal Reserve rate hikes.
Image: XAU/USD 48h performance chart The chart shows a sustained retreat from $4,461.90, with gold briefly touching $4,284.34 before recovering part of the fall.
A Forecast Built on Fiscal Anxiety and Persistent Demand UniCredit said: “We remain constructive on gold and have raised our forecast range to USD 4,400-5,200/oz by end-2026.”
From the current price, a return to $4,400 would require a gain of just over 2%.
Reaching $5,200 would demand a much larger recovery of around 20.7%, while UniCredit also sees “meaningful upside potential” towards $5,000 within its forecast period.
The bank explained: “First, central banks continue to accumulate gold, providing a strong structural anchor for demand. Second, the steepening Treasury curve points to rising concerns about fiscal sustainability and long-term inflation risks, factors that have historically strengthened the appeal of gold. Third, ETF inflows have recovered, adding investment demand to an already supportive backdrop.”
That central-bank argument is supported by World Gold Council data, which recorded net official-sector purchases of 289 tonnes during the second quarter.
UniCredit’s upper forecast boundary is also close to RBC’s $5,250 average gold forecast for 2027.
Yield Shock Reverses the Gold Momentum The weakness since the forecast was published shows that gold has not fully escaped its traditional sensitivity to interest rates.
UniCredit noted that Kevin Warsh’s Jackson Hole speech had already changed the bond-market tone: “His speech led to a strong bear-flattening of the UST curve, with the 2Y yield rising by 10bp on the day.”
Oil-driven inflation concerns have since pushed yields higher, increasing the opportunity cost of holding non-yielding bullion and strengthening the US Dollar.
This does not remove the fiscal, ETF and central-bank support behind UniCredit’s forecast, but it could delay the expected advance.
US employment data, oil prices and Treasury yields will set the immediate direction.
A renewed fall below $4,284 would extend the correction, while a recovery through $4,400 would return gold to the bottom of UniCredit’s forecast range.
Silver prices have fallen almost 5% in 48 hours, delivering analysts' expected correction and bringing a buy-the-dip call into focus. The silver price has fallen to $63.69 an ounce after an abrupt correction erased almost 5% from XAG/USD over 48 hours.
Silver opened the period at $67.02 and briefly traded as high as $67.44 before sliding to $63.36.
The metal fell 3.63% on Tuesday and extended the decline by another 0.75% on Wednesday morning.
The move followed Kevin Warsh’s hawkish Federal Reserve warning, which lifted rate-hike expectations and pressured precious metals.
Image: Silver price in US Dollars (XAG/USD) 2-day graph The chart shows little sign of a sustained rebound, with silver trading just 8% above the bottom of its 48-hour range.
Wait for the Dip, Then Buy? Spectra Markets had warned that silver was overbought and due a pullback, but it did not recommend abandoning the broader trade.
“Same view in gold and silver as I have in crypto. They are overbought, they will dip and you buy the dip. There is no rush here.”
The forecast is directional rather than price-specific.
Spectra provided no silver target or preferred entry level, leaving investors to decide how far the correction must run before the dip becomes attractive.
Its analysis was based on a volatility-adjusted basket of silver, gold, Bitcoin and Ethereum, where the average relative strength index had moved above 80.
Spectra acknowledged the limitations of the study: “Again, I realize the sample size is small, but when I am filtering for mega extremes in overbought and oversold, the sample sizes are going to be small by definition. I am highlighting the most extreme past occurrences and pointing out that this one is similar.”
There were only four previous non-overlapping signals.
Silver was lower 20 days later in every case, with losses of 8.2%, 10.9%, 6.7% and 5.0%.
The average decline was 7.7%.
Spectra found that gold had held up better during previous reversals: “A useful takeaway from this is that you can see gold is not like the others. When crypto and silver are leading the charge, and they pull back, gold does okay.”
The Silver price has now fallen more than 10% from August’s $71.03 high, although it remains around 10.5% above its opening level for that month.
With no specified buying level, the immediate markers are the $63.36 low, US employment data and the direction of Treasury yields.
A break below $63.36 would suggest the correction has further to run, while stabilisation above that level would offer the first support for Spectra’s buy-the-dip view.
Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.
Gold (XAU/USD) remains on the defensive on Wednesday after tumbling nearly 2.7% the previous day. The resumption of hostilities in the Middle East after several quieter weeks is once again dominating market sentiment, driving Oil prices and global bond yields higher while strengthening the US Dollar (USD). At the time of writing, XAU/USD trades around $4,310 after hitting an intraday low of $4,282, its lowest level since August 7.
Bond yields have climbed to multi-year highs across major economies as rising Oil prices threaten to keep inflation elevated for longer. This could force central banks to maintain restrictive monetary policy or even consider raising interest rates. The benchmark 10-year US Treasury yield advances for the sixth consecutive day and trades around 4.81%, its highest level since October 2023.
Rising yields and expectations of higher interest rates are weighing heavily on the non-yielding metal, outweighing the support Gold would normally receive from heightened inflation and geopolitical tensions given its traditional role as a hedge against both risks.
On the monetary policy front, traders have increased bets that the Federal Reserve (Fed) could raise interest rates as soon as September, particularly after Fed Chair Kevin Warsh adopted a tougher stance on inflation at the Jackson Hole Symposium last week. According to the CME FedWatch tool, the probability of a rate hike at the September 15-16 meeting stands at around 70%, up from 36% a week ago.
Hawkish Fed expectations and escalating US-Iran tensions have also increased demand for the US Dollar, adding another headwind for the Dollar-denominated Gold. The US Dollar Index (DXY), which tracks the Greenback’s value against a basket of six major currencies, trades around 99.85, its highest level since August 14.
Against this backdrop, Gold is likely to retain a downside bias, although sellers could refrain from placing aggressive bets ahead of US labour market data. The ADP Employment Change report is due later during American trading hours, followed by the Nonfarm Payrolls (NFP) report on Friday. The figures could influence Fed interest-rate expectations and drive fresh moves in the US Dollar, Treasury yields and, in turn, Gold.
Technical analysis: Bears eye $4,200 as RSI slips below 50
XAU/USD holds below the 100-day Simple Moving Average (SMA) at roughly $4,360 and the Bollinger Bands midline near $4,445, keeping the near-term bias tilted lower. Momentum gauges reinforce this capped tone, with the Relative Strength Index (RSI) on the daily chart hovering just below the neutral 50 line at 45, while the Moving Average Convergence Divergence (MACD) histogram sits in negative territory, signaling increasing bearish pressure.
On the downside, immediate support is aligned with the Bollinger Bands lower band at about $4,204, ahead of a more substantial horizontal floor at $4,000. On the topside, initial resistance emerges at the 100-day SMA near $4,360, followed by the Bollinger Bands midline around $4,446, with the upper band near $4,688 acting as a more distant cap.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
ING commodities strategists Warren Patterson and Ewa Manthey say Gold has slipped to a two‑week low below $4,300/oz as higher Oil prices revive concerns over US inflation and limit near‑term Federal Reserve easing. They note recent profit‑taking but argue medium‑term support from lower rate expectations, central bank buying and persistent geopolitical uncertainty.
Safe-haven metal consolidates gains"Gold prices eased to a two-week low, slipping below $4,300/oz, as escalating tensions in the Middle East push oil prices higher. This prompted markets to reassess the outlook for US interest rates. Rising energy costs could add to inflationary pressures and reduce the scope for near-term Federal Reserve easing, weighing on non-yielding assets such as gold."
"The decline follows a strong August rally, with gold gaining nearly 10% and recording its biggest monthly increase since January. Safe-haven demand and growing concerns over US fiscal sustainability have continued to underpin investor interest in gold and other hard assets."
"While near-term profit-taking could continue after gold's recent run-up, broader fundamentals remain supportive. Expectations of lower rates over the medium term, central bank purchases and elevated geopolitical uncertainty should provide a floor for prices. Any pullbacks are likely to attract fresh buying interest."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
USD/JPY consolidated near 160.25 on Wednesday, hovering close to its highest level since late July. Pressure on the yen has intensified amid a global bond sell-off, with the yield on 10-year Japanese government bonds rising to 3% for the first time since 1996 – increasing the cost of servicing Japan’s massive national debt and heightening concerns about fiscal sustainability.
Prime Minister Sanae Takaichi’s plans for large-scale investment add another layer of uncertainty. Markets fear that aggressive fiscal policy could further complicate the debt situation, limiting support for the yen even as expectations of a Bank of Japan rate hike continue to rise.
Pressure on the BoJ is also increasing from the US. Treasury Secretary Scott Bessent backed the idea of taking stronger steps to address yen weakness, effectively reinforcing expectations of a rate hike as early as September. However, even tighter BoJ policy has yet to change the broader picture. Borrowing costs in Japan remain significantly lower than in the US and other major economies, meaning the carry trade continues to weigh on the yen.
The dollar, in turn, is drawing support from safe-haven demand amid escalating US–Iran tensions, and growing expectations of a Fed rate hike driven by inflation risks from higher oil prices. This keeps the fundamental backdrop for USD/JPY moderately positive.
At the same time, ahead of Friday’s Nonfarm Payrolls report, market participants may avoid making more aggressive bets on further gains.
Technical Analysis
On the H4 USD/JPY chart, the pair is undergoing a correction. A further pullback towards 158.97 is possible today, followed by a potential rebound from support and a return to the ascending channel. The first upside target is 160.27, followed by 160.67. The MACD indicator supports this scenario, with its histogram above zero but beginning to decline and the signal line potentially crossing above the histogram before turning downward.
On the H1 chart, USD/JPY is testing 159.65 as the correction develops. A test of 158.97, followed by a rebound, could open the way for a move higher, with the first target at the 160.27 resistance level. The Stochastic oscillator supports this scenario, with its signal lines below 20.0. A break above 20.0 from below would signal the potential start of an upward move.
Conclusion USD/JPY is trading near its highest level since late July as the yen remains under pressure from a combination of factors: rising JGB yields, concerns about fiscal sustainability under Prime Minister Takaichi’s spending plans, and the persistent appeal of the carry trade. While markets are pricing in a potential BoJ rate hike as early as September, borrowing costs in Japan remain significantly below those in the US and other major economies, keeping the yen vulnerable. The dollar continues to benefit from safe-haven demand amid US–Iran tensions and Fed rate hike expectations driven by inflation risks from higher oil prices. Technically, USD/JPY may see a near-term pullback towards 158.97 before resuming its move higher towards 160.27 and potentially 160.67, with Friday’s US jobs data likely to shape the next directional move.
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USD/JPY consolidated near 160.25 on Wednesday, hovering close to its highest level since late July. Pressure on the yen has intensified amid a global bond sell-off, with the yield on 10-year Japanese government bonds rising to 3% for the first time since 1996 – increasing the cost of servicing Japan’s massive national debt and heightening concerns about fiscal sustainability.
Prime Minister Sanae Takaichi’s plans for large-scale investment add another layer of uncertainty. Markets fear that aggressive fiscal policy could further complicate the debt situation, limiting support for the yen even as expectations of a Bank of Japan rate hike continue to rise.
Pressure on the BoJ is also increasing from the US. Treasury Secretary Scott Bessent backed the idea of taking stronger steps to address yen weakness, effectively reinforcing expectations of a rate hike as early as September. However, even tighter BoJ policy has yet to change the broader picture. Borrowing costs in Japan remain significantly lower than in the US and other major economies, meaning the carry trade continues to weigh on the yen.
The dollar, in turn, is drawing support from safe-haven demand amid escalating US–Iran tensions, and growing expectations of a Fed rate hike driven by inflation risks from higher oil prices. This keeps the fundamental backdrop for USD/JPY moderately positive.
At the same time, ahead of Friday’s Nonfarm Payrolls report, market participants may avoid making more aggressive bets on further gains.
Technical analysis
On the H4 USD/JPY chart, the pair is undergoing a correction. A further pullback towards 158.97 is possible today, followed by a potential rebound from support and a return to the ascending channel. The first upside target is 160.27, followed by 160.67. The MACD indicator supports this scenario, with its histogram above zero but beginning to decline and the signal line potentially crossing above the histogram before turning downward.
On the H1 chart, USD/JPY is testing 159.65 as the correction develops. A test of 158.97, followed by a rebound, could open the way for a move higher, with the first target at the 160.27 resistance level. The Stochastic oscillator supports this scenario, with its signal lines below 20.0. A break above 20.0 from below would signal the potential start of an upward move.
ConclusionUSD/JPY is trading near its highest level since late July as the yen remains under pressure from a combination of factors: rising JGB yields, concerns about fiscal sustainability under Prime Minister Takaichi’s spending plans, and the persistent appeal of the carry trade. While markets are pricing in a potential BoJ rate hike as early as September, borrowing costs in Japan remain significantly below those in the US and other major economies, keeping the yen vulnerable. The dollar continues to benefit from safe-haven demand amid US–Iran tensions and Fed rate hike expectations driven by inflation risks from higher oil prices. Technically, USD/JPY may see a near-term pullback towards 158.97 before resuming its move higher towards 160.27 and potentially 160.67, with Friday’s US jobs data likely to shape the next directional move.
Gold (XAU/USD) maintains its bearish trend on Wednesday, as higher geopolitical tensions and growing bets of a Federal Reserve (Fed) rate hike in September boost speculative support to the US Dollar. The precious metal is testing the support area around $4,300 as of writing, 3.25% down on the week so far.
Bullion has been struggling since the US Fed Chairman Kevin Warsh boosted expectations of an interest rate hike in September at the Jackson Hole central banker’s summit on Friday. Warsh struck an unexpectedly hawkish tone, affirming that prices should be the central bank’s main concern right now and that they have “work to do” to bring interest rates to the 2% target.
Beyond that, the resumption of hostilities between the US and Iran has increased risk aversion, providing additional support for the safe-haven USD. The US military launched a new wave of strikes on Islamic Revolutionary Guard Corps (IRGC) positions across Iran, which were responded to with attacks on US bases in Bahrain, Iraq and Jordan.
Technical Analysis: Gold comes under growing bearish pressure
XAU/USD trades at $4,310, holding an immediate bearish tone below the 200-day simple moving average (SMA), with momentum indicators showing growing negative traction. The daily Relative Strength Index (RSI) has broken below the key 50 line, while the Moving Average Convergence Divergence (MACD) is deeply negative at -30.53, altogether hinting at solid downside momentum.
A clear break below the mentioned $4,300 area (August 14, 18 and 19 lows) would clear the path toward the August 6 low, near $ 4,225, ahead of the late July lows in the $4,000 area
On the topside, the previous support area around $4,450 (August 20 low) is likely to act as resistance now. Further up, the mentioned 200-day SMA, at the $4,530 area, will challenge bulls ahead of last week's highs, near $4,700.
(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.
Silver prices (XAG/USD) fell on Wednesday, according to FXStreet data. Silver trades at $63.87 per troy ounce, down 0.35% from the $64.09 it cost on Tuesday.
Silver prices have decreased by 10.15% since the beginning of the year.
The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, stood at 67.56 on Wednesday, broadly unchanged from 67.54 on Tuesday.
Silver FAQs Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
The Euro-Dollar rate has slipped to 1.1574, but UBS sees recovery towards 1.18–1.20 as limited policy divergence contains FX volatility. The Euro to Dollar (EUR/USD) exchange rate has fallen back to 1.1574 after its late-August recovery ran out of momentum above 1.17.
The reversal has left the live EUR/USD rate near the bottom of its latest trading range, with the pair down around 0.15% on Wednesday morning.
At current levels, the bottom of UBS’s 1.18–1.20 forecast range would represent an advance of roughly 2%, while the upper boundary implies potential gains approaching 3.7%.
Image: EUR/USD 48-hour chart The 48-hour chart captures the change in tone: EUR/USD briefly touched 1.1624 before sliding towards 1.1573, just above the period low of 1.1568.
Neutral Euro View, Higher EUR/USD Range UBS stated: “We remain Neutral on the EUR and expect EURUSD to move back between 1.18-1.20, while GBP and NOK remain Attractive given their yield appeal.”
UBS is not predicting a powerful, one-way Euro rally, but it does expect the recent Dollar rebound to fade enough for EUR/USD to revisit higher levels.
The bank’s view rests partly on the absence of a large and persistent interest-rate gap between the major central banks.
“We believe limited monetary policy divergence should keep FX volatility contained, supportive of selective exposure to pro-growth, carry currencies.”
This leaves UBS broadly aligned with Rabobank’s 1.18 EUR/USD forecast, although the UBS range allows for a more substantial move towards 1.20.
European Growth Offers Some Support The European growth picture is another part of the argument.
UBS said: “Eurozone and UK growth continue to outperform expectations, as higher borrowing costs have had limited impact on activity and higher energy prices have yet to materially weigh on growth (we forecast Eurozone GDP growth of +0.8% in 2026, +1.2% in 2027, and UK: +1.1% in 2026 and 2027).”
It also expects another European Central Bank rate increase: “Thus, we expect the ECB to hike once more in September, to 2.5% before pausing, and the BoE to hold policy rates at 3.75% through year-end 2026.”
Image: EUR to USD exchange rate 3-month chart The three-month chart offers a less bearish picture than the latest sell-off alone, with EUR/USD still above its rising 50-day moving average despite retreating from August’s 1.1711 high.
The immediate tests will come from US employment data and the September ECB decision.
Further Dollar strength could put 1.15 back in play first, but a cooling in US yields would bring UBS’s 1.18 recovery target into clearer view.
Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.
The Euro (EUR) is trading lower against the US Dollar (USD) for the second consecutive day on Wednesday, weighed by risk aversion amid growing tensions in the Middle East, while rising bets of Federal Reserve (Fed) interest rate hikes support speculative demand for the US Dollar. The EUR/USD pair trades at 1.1580, after being rejected at the 1.1620 area on Tuesday.
Geopolitical tensions are hurting investors' appetite for risk as reciprocal attacks between the US and Iran escalate, casting further doubt about a negotiated end of the war and pushing Crude Prices higher. Brent Oil trades at $94.00, nearly 7% up on the week, posing a significant challenge for the Eurozone’s economies as the increasing energy costs might dampen an already frail growth.
The US military launched a wave of strikes on Islamic Revolutionary Guard Corps (IRGC) targets across Iran, which were responded to with attacks on US bases in Bahrain, Jordan and Iraq, amid Tehran's accusations that the US bombings killed 18 civilians celebrating a wedding on Tuesday.
US data disappoints but fails to curb Fed tightening hopesIn the US, macroeconomic data disappointed on Tuesday. The US ISM Manufacturing Purchasing Managers Index (PMI) slowed down beyond expectations in August, with the prices paid sub-index flat and the employment gauge retreating from July’s high.
Beyond that, US JOLTS Job Openings increased below expectations in July. These figures, however, failed to dent hopes that the Federal Reserve will hike rates by a quarter percentage point at its September meeting. The CME Group’s FedWatch Tool shows a 68% chance of a rate hike later this month, nearly twice last week’s 36% rating.
In the Eurozone, data from Spain revealed that unemployment increased well beyond expectations in August and that the Italian Producer Prices Index accelerated in July. Also on Wednesday, the European Central Bank (ECB) Committee member, Joachim Nagel, affirmed that “markets see over 95% chance of a September rate hike”, yet with no visible impact on the Euro as that outcome has already been priced in.
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 has hit a wall this week, sliding to two-week lows near $4,320 and posting an 8.7% drop from last week’s three-month highs near $4,700. The catalyst is unmistakable: Fed Chair Warsh’s hawkish Jackson Hole remarks, warning the Fed still has “work to do” without clearer evidence inflation is returning to target, sent September hike odds surging from roughly 36% before his speech to over 66% today. Rising Treasury yields and renewed Middle East tensions, following fresh US strikes and Iranian retaliation against the UAE and Jordan, have only added to the pressure.
Despite this sharp pullback, the broader picture remains genuinely constructive: gold still gained around 10% in August alone after the US Treasury’s surprise move to double its long-dated bond buyback programme reignited fears over fiscal credibility, the so-called debasement trade that has underpinned much of this year’s rally.
All eyes now turn to Friday’s Non-Farm Payrolls report, the week’s decisive catalyst. A weak print could quickly reverse this hawkish repricing and revive gold’s momentum, while a strong one would likely deepen the current correction heading into the Fed’s September 15–16 meeting.
Technical Analysis of XAU/USD
As the XAU/USD chart shows, gold has pulled back sharply from the 4,698.73 highs and is now trading between two key confluences: above the 0.618 Fibonacci retracement near 4,265, which aligns with the ascending trendline off the late-July lows, and below the 0.5 retracement near 4,348, which coincides with the 200-period EMA at 4,367.
Bullish Scenario
Should buyers defend the 0.618-trendline confluence, the broader recovery structure remains intact. A push back above the 0.5 retracement and the 200-period EMA would open the path towards reclaiming the descending trendline, with scope to challenge the 0.382 level near 4,431.
Bearish Scenario
Conversely, a decisive break below the 0.618 retracement and the ascending trendline would signal that the correction has real legs, exposing the 0.786 level near 4,147, with a deeper slide risking a full retest of the 3,997 low that anchored the entire August rally.
With price squeezed between a defended trendline-Fibonacci confluence below and a stubborn EMA-Fibonacci resistance above, gold’s next move looks set to determine whether Friday’s jobs report tips the balance towards renewed strength, or confirms this correction has further to run.
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TL;DR: NZD/JPY fell over 1% despite the RBNZ’s second consecutive hike, as an Iran-driven oil shock reduced carry appetite, increasingly hawkish BoJ rhetoric strengthened the Yen, and the RBNZ’s own gradual guidance disappointed markets pricing a faster path.
Four Forces Are Hitting NZD/JPY at Once NZD/JPY fell more than -1% on Wednesday, even after the RBNZ delivered a second consecutive 25bp rate hike to 2.75%. At first glance, that looks contradictory — higher New Zealand rates should normally support NZD. But the current decline is being driven by several forces pointing in the same direction: an Iran-driven oil shock has weakened risk appetite and encouraged carry reduction; BoJ rhetoric is reinforcing expectations for faster Japanese tightening; US pressure is adding urgency to the Yen story; and the RBNZ’s own guidance disappointed markets looking for a more aggressive hiking path.
That distinction matters for durability. Geopolitical risk and equity weakness can reverse quickly if oil retreats or US-Iran tensions ease. But BoJ-RBNZ policy divergence could persist even after risk sentiment stabilizes. In other words, oil triggered the broad move, while central-bank divergence amplified it.
Iran and Oil Trigger the Risk-Off Layer Fresh Middle East escalation pushed Brent as high as around $97 earlier Wednesday, reviving concern over the Strait of Hormuz, inflation, and another round of US-Iran retaliation. Asian equities reflected the deterioration in risk appetite, with the Nikkei down around -2.5% and the KOSPI falling almost -4%.
For NZD/JPY, this matters through carry rather than a simple safe-haven mechanism. NZD is highly sensitive to global risk appetite, while the Yen has historically served as a funding currency for positions in higher-yielding assets. When volatility rises and investors reduce leverage, those trades are unwound by selling higher-beta currencies and buying back the Yen.
That gives Middle East escalation a clear transmission channel into NZD/JPY. But it’s only the first layer. Wednesday’s selloff is larger because the Yen itself is also receiving increasingly hawkish policy support.
The BoJ Debate Is Moving Beyond September Markets are already close to fully pricing a BoJ hike at the September 17–18 meeting, so simply expecting a move from 1.00% to 1.25% is no longer especially new. The more important question is whether September marks the start of a faster tightening cadence.
US Treasury Secretary Scott Bessent has added pressure from Washington. NHK reported that Bessent told Finance Minister Satsuki Katayama and BoJ Governor Kazuo Ueda at the G20 meeting that Japan’s “next step should be to raise interest rates.” Nomura’s Mari Iwashita highlighted the credibility of that signal, saying: “Whenever Bessent made comments on Japanese monetary policy, the BOJ followed through with rate hikes.”
BoJ board member Hajime Takata then sharpened that message on Wednesday in Sapporo. He described “2026 [as] a regime change” and argued policy should become “nimble and data-dependent,” rather than being “bound by particular intervals or ranges anticipated in the markets.” Takata was already the sole dissenter in July, proposing an immediate hike from 1.00% to 1.25%.
That makes the current Yen story less about one September move and more about the possibility that the BoJ abandons its twice-yearly tightening rhythm. If markets begin pricing another hike substantially sooner than previously expected, Yen-funded carry becomes structurally less attractive.
RBNZ Delivered the Hike but Not the Hawkish Path The New Zealand side produced the opposite surprise. The RBNZ raised the OCR from 2.50% to 2.75% by consensus, but NZD sold off sharply because markets were trading the future path rather than Wednesday’s decision itself. The RBNZ characterized tightening as gradual and stressed that policy isn’t on a preset course.
Its quarterly-average OCR projections rise only gradually from 2.8% in December 2026 to 3.0% in March 2027, 3.1% in June and September, and 3.2% by December 2027. Governor Anna Breman also emphasized the need to assess how rate increases already delivered are transmitting through the economy before deciding the next step.
Inflation risks aren’t viewed uniformly either. Hayley Gourley, Karen Silk, Prasanna Gai, and Breman saw risks tilted to the upside, while Paul Conway and Carl Hansen judged them balanced. That 4–2 split matters because it shows the Committee agrees on the current hike but not on the need for an aggressively hawkish future path.
So the RBNZ delivered hawkish action but a dovish reaction. Rates rose, but the policy message didn’t validate expectations for rapid tightening.
BoJ and RBNZ Are Moving in Opposite Directions at the Margin This is what makes NZD/JPY particularly useful. The BoJ is telling markets not to assume rate hikes will remain six months apart. The RBNZ is telling markets not to assume further hikes will come quickly.
That doesn’t mean the RBNZ is turning dovish outright — it’s still tightening and sees inflation risks. But relative monetary-policy surprise is what matters for FX. Japan is challenging expectations for gradualism just as New Zealand is reinforcing them.
The pair therefore captures more than generic risk aversion. It combines:
Higher geopolitical risk → lower carry appetite. Faster BoJ normalization risk → stronger Yen. Slower-than-hoped RBNZ tightening → weaker NZD. That three-way alignment explains why NZD/JPY is moving more aggressively than either central-bank headline might imply in isolation.
ActionForex’s Technical View on NZD/JPY: Break of the 55-Day EMA Shifts Focus to 91.02 The technical picture has deteriorated sharply. NZD/JPY’s fall through the 55-day EMA around 93.78 confirms the rebound from 91.64 completed at 95.18. The decline from 95.18 is now viewed as another falling leg within the broader consolidation from 95.41.
The near-term bias stays lower while 94.21 minor resistance holds, with focus turning to 91.02 support. Strong support could emerge around that zone and trigger a rebound.
However, downside risk becomes more serious if carry unwind intensifies alongside further equity weakness and higher oil. A break of 91.02 would expose 89.44, the 38.2% retracement of the larger rise from 79.79 to 95.41.
One caution is that the 4H RSI has already fallen close to 20, leaving the pair deeply oversold in the short term. A rebound would therefore not be surprising. But the technical damage would remain intact unless NZD/JPY can recover above 94.21 and, more importantly, regain the lost 55-day EMA.
What Determines Whether the Selloff Lasts? There are two separate questions. The first is whether the geopolitical catalyst persists. Brent’s move toward $102 is key — if oil continues higher and Asian equities remain under pressure, carry reduction can extend and accelerate downside in NZD/JPY. If US-Iran tensions ease and Brent retreats, that part of Wednesday’s move could reverse quickly.
The second is whether policy divergence survives beyond the current risk shock. The BoJ’s Sept. 17–18 decision and guidance will test whether Takata’s call for more nimble tightening is gaining broader support. In New Zealand, upcoming data will determine whether the RBNZ stays in wait-and-assess mode or shifts toward a faster path. Friday’s US payrolls also matter indirectly through global yields and risk appetite.
For now, NZD/JPY isn’t falling because of one headline. Iran escalation triggered carry reduction, the BoJ’s increasingly hawkish message strengthened the Yen side, and the RBNZ’s gradual guidance weakened the Kiwi side. That combination makes the current decline more than a simple geopolitical trade.
Key Takeaways NZD/JPY fell over 1% despite the RBNZ’s second straight hike, because markets traded the future path (gradual, disappointing) rather than the decision itself. Bessent’s public pressure on the BoJ and Takata’s “2026 regime change” comments suggest Japan may abandon its twice-yearly tightening rhythm for something faster. The RBNZ’s 4–2 committee split on inflation risk and quarterly-average OCR path (only reaching 3.2% by December 2027) confirm hawkish action but dovish forward guidance. Iran-driven oil moving toward $102 is the reversible layer of this selloff; BoJ-RBNZ policy divergence is the layer that could persist even if geopolitical risk eases. NZD/JPY has broken its 55-day EMA, opening a path toward 91.02 and then 89.44, though a 4H RSI near 20 leaves the pair deeply oversold and due for a possible bounce.
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USD/CAD extends its gains for the second consecutive day. trading around 1.3940 during the European hours on Wednesday. The technical analysis of the daily chart indicates the pair is positioned above the descending channel top, signalling a bullish reversal.
The USD/CAD is consolidating in a neutral near-term bias as it holds above the short-term nine-day Exponential Moving Average (EMA) but remains capped by the 50-day EMA. This split structure suggests the pair is stabilizing after recent weakness, with the 14-day Relative Strength Index (RSI) hovering around 51 and hinting at balanced momentum rather than a clear directional impulse.
The USD/CAD pair may test the immediate resistance at the 50-day EMA of 1.3949. A break above the medium-term price average would strengthen the bullish bias and support the pair to explore the region around the nearly 17-month high of 1.4248, which was recorded on June 24, 2026.
On the downside, the primary support lies at the nine-day EMA of 1.3882. A pullback toward the descending channel could revive the bearish bias and put downward pressure on the USD/CAD pair to test the descending channel bottom around 1.3670. A break below the channel would open the doors for the pair to navigate the region around 1.3481, the lowest since October 2024.
Barr flags risk of renewed hikes as inflation stays too highBarr’s latest remarks register slightly more hawkish than the established baseline, with a 7/10 FXS Speechtracker score versus a 6.8/10 historical average, as the emphasis on “inflation remains too high” and the risk of further tightening dominates the tone. The conditional stance—favoring steady rates only if there is confidence inflation is moderating, but warning that a lack of progress would warrant an interest rate hike—keeps a clear tightening bias in play even as Barr acknowledges a stable labor market and “solid” growth supported by artificial intelligence investment. Overall, the message reinforces upside risks to rates and supports the Dollar on balance, especially if incoming data fail to confirm disinflation.
The FXS Fed Sentiment Index slipped by 0.42 points to 128.86, signaling a modest pullback in perceived hawkishness despite remaining firmly above the neutral 100 mark. This configuration suggests that while the broader Fed tone captured by the FXS Fed Sentiment Index has eased slightly, it still resides in clearly hawkish territory, consistent with Barr’s conditional tightening bias reflected in the FXS Speechtracker score.
USD/CAD: Daily Chart(The technical analysis of this story was written with the help of an AI tool. Know more.)
Canadian Dollar Price Today The table below shows the percentage change of Canadian Dollar (CAD) against listed major currencies today. Canadian Dollar was the weakest against the Japanese Yen.
USDEURGBPJPYCADAUDNZDCHFUSD0.16%0.11%-0.21%0.30%0.24%1.42%0.38%EUR-0.16%-0.07%-0.35%0.16%0.08%1.23%0.22%GBP-0.11%0.07%-0.28%0.22%0.13%1.27%0.28%JPY0.21%0.35%0.28%0.49%0.43%1.58%0.57%CAD-0.30%-0.16%-0.22%-0.49%-0.06%1.09%0.08%AUD-0.24%-0.08%-0.13%-0.43%0.06%1.15%0.16%NZD-1.42%-1.23%-1.27%-1.58%-1.09%-1.15%-0.99%CHF-0.38%-0.22%-0.28%-0.57%-0.08%-0.16%0.99% 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 Canadian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent CAD (base)/USD (quote).
US Dollar/Japanese Yen (USD/JPY): Arc cycle analysis
Overview: Based on Arc Cycle Analysis applied to the 30m chart, U.S. Dollar/Japanese Yen is interacting with the 0.236 Resistance Arc within the current Arc Cycle. Bullish momentum has faded near this boundary, indicating that the upper Arc continues to cap upside expansion.
Metric
Reading
Market Bias
Neutral-Bearish
Preferred Scenario
Two-Way Navigation Within the Current Arc Range
Target Arc
0.382 Arc
Potential Interim Move
A move toward the upper Arc may occur before bearish continuation.
Current Arc Level
In Transit Between Arcs (0.236 Arc to 0.382 Arc)
Cycle Status
Mid-Cycle Migration Phase
Market outlookThe 0.236 Arc continues to act as a resistance boundary, capping upside expansion. Bullish attempts have stalled beneath the Resistance Arc, indicating that the resistance remains intact.
If the Resistance Arc holds firm, a decline toward 0.382 Arc becomes the primary scenario. Conversely, a sustained 30m close above 159.80 would invalidate the bearish scenario, opening the path toward the upper Resistance Arc.
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Overview: Based on Arc Cycle Analysis applied to the 4h chart, Euro / U.S. Dollar is trading between the 0.618 Arc and 0.786 Arc within the current Arc Cycle. Price is oscillating between these boundaries, progressing through a mid-cycle consolidation phase toward the lower Arc level.
Metric
Reading
Market Bias
Neutral-Bearish
Preferred Scenario
Two-Way Navigation Within the Current Arc Range
Target Arc
0.786 Arc
Potential Counter-Move
A counter-move toward the upper Arc may occur before bearish continuation.
Current Arc Level
In Transit Between Arcs (0.618 Arc to 0.786 Arc)
Cycle Status
Mid-Cycle Migration Phase
Market outlookPrice is actively trading between the 0.618 Arc and the 0.786 Arc, indicating that the market is navigating through the current Arc Cycle toward the lower Arc boundary. While price may experience a pullback toward the 0.618 Arc, the broader cycle structure remains oriented toward a test of the 0.786 Target Arc.
The USD/CAD is currently in a cautious bullish move ahead of the Bank of Canada's interest rates decision on 2 September 2026. Current setup Bias: cautiously bullish USD/CAD.
USD/CAD is currently trading with a cautiously bullish sentiment ahead of the Bank of Canada’s interest rate decision. The pair’s latest quoted price is around 1.3931. The cautious bullish bias stems from defensive positioning into the US dollar due to renewed US-Iran geopolitical tensions and Tuesday’s rise in US Treasury yields. US bond yields are rising amid growing expectations of a September Fed rate hike, following the Fed Chair’s Jackson Hole comments.
Canada is a major oil exporter, and the commodity-linked Canadian dollar is receiving a boost from the sharp rise in oil prices that trails the geopolitical standoff. However, this has proved insufficient in offsetting the greenback’s broad strength.
USD/CAD: Macro Drivers 1) Fed expectations Bets for a September Fed rate hike have risen sharply and are approaching 70%. The Fedwatch CME tool currently shows a 67.9% probability of rates going up to 3.75%-4.00%. The rise in US Treasury yields has strengthened the dollar’s interest-rate advantage over the Bank of Canada. The yield advantage could widen if the BoC holds rates amid hawkish Fed expectations.
2) Higher oil prices support the CAD Brent crude has climbed above $95 amid the renewed US-Iran geopolitical conflict. The Canadian economy benefits from this environment whenever crude prices soar, boosting the CAD. This factor currently constrains any USD/CAD upside moves.
3) Bank of Canada Decision Market consensus is that the Bank of Canada will keep interest rates unchanged. Current trade tensions with the US increase uncertainty about the Canadian economy. This is likely the overriding driver encouraging BoC policymakers to remain cautious.
Price Catalysts that Matter This Week The key catalysts for the week are:
1. Bank of Canada decision: The BoC is expected to leave the Overnight Rate unchanged at 2.25%. Watch out for the tone of the statement. However, leaving rates at this level maintains a yield differential of at least 150 bps between the Fed and BoC.
2.US jobs data: A stellar Non-Farm Payrolls report doubles down on the Fed’s hawkish rhetoric and keeps US bond yields elevated and the US Dollar supported.
3. Fed expectations: As long as US bond yields remain elevated and the odds for a September Fed rate hike keep rising, hawkish Fed expectations will continue to be a primary catalyst of price action on the USD/CAD.
4. Oil prices: The CAD is expected to benefit from oil prices better than its southern neighbour. The question is whether this benefit offsets the USD’s defensive demand from geopolitically-driven safe-haven plays, or the hawkish Fed expectations which keep the greenback on bid.
USD/CAD: Weekly Forecast Scenarios Base case: The base case scenario sees the pair maintaining its cautiously bullish move. This keeps the pair in a modest uptrend, supported above the 1.3800 psychological pivot.
Bull case: A strong US jobs report on Friday + hawkish Fed expectations → allows USD/CAD to break above 1.3920, with targets set initially at the 1.4000 psychological barrier.
Bear case: oil extends its rally (CAD supportive) + BoC hawkish statement (even if rates stay unchanged) + disappointing US jobs data → USD/CAD falls back toward 1.3800.
USD/CAD Technical Outlook The current bullish move will be sustained if the ongoing breakout above the 1.3919 resistance completes. This will set bulls on the path toward the 1.4013 resistance (19 July low). Above this barrier, the 27th July high at 1.4129 forms the next upside target.
Fig 1: USD/CAD (4-hr chart) showing key price levels (snapshot: 2 September 2026) On the flip side, the 28 May low at 1.3774 forms the next downside target if the breakout move above 1.3919 fails. The 17 August/1 September lows at 1.3850 form the intermediate pivot which must be degraded to expose 1.3774.
Bottom line The immediate bias for the pair remains cautiously bullish. This reflects US monetary-policy expectations and safe-haven demand for the greenback from the geopolitical escalation outweighing whatever support the CAD gets from higher oil prices.
USD/JPY volatility has returned to the spotlight after a sharp yen move late in the Asian session initially raised questions over whether Japanese authorities had stepped back into the market.
The move followed comments from Bank of Japan policymaker Hajime Takata, who argued for a more nimble approach to adjusting interest rates as policymakers respond to inflation. That potentially increases the importance of each BOJ meeting and puts the path for Japanese rates firmly back into focus.
USD/JPY Faces BOJ and US Data Risk The latest move comes at an important point for USD/JPY. Volatility has increased, trading volume has picked up and price is approaching an area where the reaction could provide useful clues about the next directional move.
But traders also have a significant US data hurdle ahead. ISM services and nonfarm payrolls could materially shift expectations for the Federal Reserve and therefore the US-Japan rate differential that remains central to USD/JPY.
In the video, I look at the latest price action, the levels that could matter from here and whether the sudden increase in yen volatility should be treated as the start of something larger or simply another short-term move.
I also examine USD/JPY behaviour around previous NFP reports and what futures positioning tells us about speculative exposure to the Japanese yen.
Watch the video for the full USD/JPY analysis, NFP volatility study and yen positioning outlook.
View related analysis:
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USD/JPY breaks its August uptrend after a bearish reversal
BOJ member Takata flags consecutive hikes, echoing Bessent
JGBs bear flatten as front-end yields surge
US jobs data may decide whether the move sticks
USD/JPY has printed a bearish reversal candle on the four-hourly timeframe, followed by a break of the uptrend in place since August 20, with the move backed by a clear fundamental catalyst as BOJ officials continue to portray a far more hawkish outlook than what was seen earlier in the year.
BOJ Hawk Opens Door to Consecutive Hikes
Speaking in Sapporo earlier in the session, BOJ board member Takata suggested the pace of rate hikes should be assessed at every meeting, rather than assuming tightening will continue at the roughly twice-yearly pace seen so far. He also openly raised the possibility of consecutive hikes.
Such hawkish talk from Takata is hardly surprising given he has consistently dissented in favour of higher rates and has been the most hawkish member of the Board. What is more interesting is his willingness to openly discuss accelerating the pace of tightening, language that closely mirrors comments from US Treasury Secretary Scott Bessent over the weekend.
Speaking ahead of the G20 finance ministers meeting, Bessent expressed confidence that BOJ Governor Ueda would “do the right thing” on monetary policy and also openly entertained the prospect of the BOJ moving more aggressively with policy normalisation.
Coming so soon after his remarks, Takata’s comments will do nothing to diminish the view that the US Treasury Secretary is exerting strong influence over the direction of Japanese policy. That perception already has plenty of fuel after the coordinated FX intervention in late July, and the overlap in language around a faster pace of tightening will only bolster it.
Ueda Flags FX as an Upside Price Risk
Adding fuel to the fire, Ueda, speaking at the conclusion of the G20 finance ministers meeting in the United States earlier Wednesday, struck a relatively hawkish tone by his usual standards. While he didn’t commit to a September hike, he was clear the bank is focusing more on upside inflation risks and will take those risks into account when deliberating policy.
He also made explicit comments on the impact of the weaker yen, saying the BOJ is carefully watching FX moves as one risk factor to the price outlook and is scrutinising yen moves among the factors contributing to upside price risks.
That makes it clear the he is acknowledging the inflation risk posed by persistent yen weakness, especially when higher energy prices stemming from the conflict in the Middle East are already adding to imported price pressures.
JGB Curve Bear Flattens Sharply
Source: LSEG, FOREX.com
While it's far too early to tell whether they’ll have any lasting success, for once bond traders are paying attention to what’s being said. There has been a noticeable bear flattening of the JGB curve, with two-year yields up 6.2bp and five-year yields 5.5bp, while the move becomes progressively smaller further out. Ten-year yields are up only 2.5bp, while 30-year yields are actually down around 1.3bp.
At current levels, the 2s30s curve has flattened by roughly 7.5bp. That is a seriously rare move, sitting around the bottom 1% of daily changes seen since 2007. The rise in two-year yields is even more extreme, around the 99.8th percentile over the same period. The obvious caveat is that the session is nowhere near finished, so these numbers can still move around a lot before the close.
Even so, this is much closer to the kind of outcome Bessent and his Japanese counterpart Satsuki Katayama are trying to achieve: a stronger yen, less pressure on the long end of the JGB curve and, by extension, less additional pressure on longer-dated US Treasuries. At the same time, it points to a market that may be starting to believe the BOJ is prepared to act on inflation by lifting real policy rates out of negative territory.
What makes the reaction to these comments unusual relative to the prevailing status quo is that it has been driven by the Japanese side of the equation rather than the US interest rate outlook, which has been the dominant factor in recent months.
USD/JPY Breaks Trend Ahead of Jobs Data
Source: TradingView
While the latest hawkish remarks have had the effect of reversing earlier weakness in USD/JPY, whether the move sticks will likely come down to the incoming flow of US data, starting with ADP private-sector employment later today before far chunkier releases arrive over the coming days, headlined by Friday’s August non-farm payrolls report.
As detailed in our week ahead note, the unemployment rate may prove more important than the payrolls figure itself, especially with the recent decline in labour force participation on track to become record-setting should we see another unchanged or lower reading for August.
Looking at USD/JPY on the four-hourly chart, you can see the key reversal candle after the pair failed to sustain an early-session push higher, eventually culminating in a break of the August 20 uptrend. The move has since stalled around 159.50, a level that has acted as both support and resistance over the past week and is now the immediate focal point beneath where the pair trades.
The message from the oscillators is one of short-term shifting momentum, with RSI (14) flipping from near overbought territory to beneath the neutral 50 level, while MACD has staged a bearish crossover but remains in positive territory. Upside momentum that had been building has abruptly declined, with directional risk now arguably starting to skew to the downside into the European session. Beneath 159.50, the levels to watch are 159.00, where the pair was bid for a period last week, followed by the area between 158.00 and 157.96, where price has done a lot of work either side of since late July.
Overhead, 160.40 was the session high hit before the latest reversal, while 160.73 is the more important technical level above, marking the multi-decade high set in April this year, which has since flipped to act as both support and resistance.
MUFG's 94.00 USD/INR target is close, but oil near $96 and higher Treasury yields threaten further Indian Rupee gains. The US Dollar to Indian Rupee (USD/INR) exchange rate slipped to 94.9523 early on Wednesday, placing MUFG's 94.00 third-quarter forecast within roughly 1% of spot.
The pair has dropped from 95.6044 at Friday's close and touched 94.7304 in early September.
When we last examined MUFG's call, USD/INR was trading near 95.75.
Spot has since moved much closer to the target, although the external backdrop has become less friendly for the Rupee.
MUFG said: “We are currently forecasting USD/INR to move towards 94.00 over the next three to six months, before rebounding towards 96.00 next year as structural portfolio outflows, corporate repatriation and import demand reassert themselves.”
Its quarterly table puts USD/INR at 94.00 in Q3 2026, 94.50 in Q4, 95.50 in Q1 2027 and 96.50 by Q2 2027.
That path points to further near-term Rupee gains, followed by a gradual reversal next year.
Image: USD/INR performance chart over 2026 - year-to-date graph The year-to-date chart shows USD/INR below its 20-day and 50-day moving averages after repeatedly failing to hold above 96, although the pair is still 5.53% higher in 2026.
RBI support has brought 94 closer MUFG attributed the Rupee's firmer footing to fading Dollar momentum and RBI foreign-currency mobilisation measures.
Foreign investors also bought around $470 million of Indian equities in the week ending 28 August, following roughly $500 million of inflows the previous week.
The bank added: “Existing foreign-currency inflows have enlarged India’s external buffer and curtailed the risk of sharp INR depreciation, but the removal of incremental liquidity support, accelerating credit growth and the lagged inflationary effects of earlier oil-price increases point towards higher INR rates.”
India's economy subsequently expanded by a stronger-than-expected 7.8% in the April-June quarter, reinforcing the case for tighter domestic policy.
MUFG said: “We continue to expect 50bp of RBI tightening beginning in December, with the central bank focused on limiting excessive FX volatility rather than engineering sustained rupee appreciation.”
Oil and US yields threaten the Rupee rally There is a catch, though.
Since MUFG published its forecast, Brent crude has climbed to $95.68 a barrel as renewed US-Iran strikes revived supply concerns.
That raises India's import bill and inflation risk, while higher US yields make emerging-market assets less attractive.
The US 10-year Treasury yield closed at 4.79% on Tuesday, up from 4.73% on Friday.
MUFG's 94.00 target has plainly come into view, but a smooth decline is no longer assured.
A break below September's 94.7304 low would strengthen the case for another push towards 94, while oil, US yields and Friday's employment report could quickly put 95.50 back in play.
Westpac analysts expect USD/JPY to test 162 in September before retreating to 154 by end-2027 and 146 by the end of 2028. The US Dollar to Japanese Yen (USD/JPY) exchange rate slipped to 159.6004 on Wednesday, leaving Westpac's September forecast target of 162 around 1.5% above spot.
USD/JPY had climbed as high as 160.3872 during the previous 48 hours before reversing sharply, while the daily decline reached 0.37%.
Image: USD/JPY 48h chart The chart above shows the pair giving back its advance through 160.30 and finishing near the bottom of its 159.4938-160.3872 range.
Westpac's September call is effectively for one more test higher rather than an unprecedented breakout.
The pair traded as high as 163.9798 in July, so 162 has already proved reachable this summer.
What follows in Westpac's forecast curve is far more interesting.
The bank sees USD/JPY easing to 160 in December and remaining there in March 2027, before falling to 158 in June, 156 in September and 154 at the end of next year.
The decline then continues at a remarkably steady pace: 152 in March 2028, 150 in June, 148 in September and 146 in December.
From the forecast peak of 162 to the final 146 target, that would be a 9.9% fall in USD/JPY and an appreciation of almost 11% for the Yen against the Dollar.
The Yen recovery is not built on aggressive Fed cuts Westpac's accompanying interest-rate forecasts make the currency path more striking.
The bank keeps the Federal Funds rate at 3.625% throughout the forecast period, rather than relying on a sizeable US easing cycle to pull USD/JPY lower.
It also expects the US 10-year Treasury yield to ease only modestly, from 4.65% in September to 4.55% in the first half of 2027.
The yield then rises gradually to 4.85% by December 2028, precisely when USD/JPY reaches 146.
In other words, Westpac is forecasting a major Yen recovery without a lasting collapse in US yields.
The published figures do not include a separate Japanese interest-rate path or written explanation for the move, so it would be wrong to assign the decline to one specific catalyst.
Still, the curve fits a market increasingly focused on whether Japanese policy can take over from direct currency support.
As we noted in our recent Yen analysis, intervention can deliver an abrupt move but has struggled to overcome the interest-rate gap for long.
Westpac's numbers instead describe a slow adjustment lasting more than two years.
These are dated forecast points rather than promised trading stops, but the message is unusually clear: 162 may come first, while the bigger move is eventually lower.
Friday's Japanese household-spending figures and US employment report provide the next test, with Westpac forecasting a 70,000 rise in payrolls against a market estimate of 55,000.
The Euro (EUR) posts moderate losses against the British Pound (GBP) on Wednesday, as the previous two days' recovery has been capped again at a key resistance area between 0.8580 and 0.8585, which holds the top of an ascending triangle pattern.
Macroeconomic data is scarce in both the UK and the Eurozone on Wednesday, and the Euro and the Pound are losing ground against a firmer US Dollar as rising global yields and fresh hostilities in Iran hammered investors’ appetite for risk.
In the Eurozone, the European Central Bank (ECB) Council member and Bundesbank President Joachim Nagel affirmed earlier on the day that markets see “over 95% chances of a September rate hike”, but has failed to provide any significant support to the Euro. The pair seems to need additional impulse to break above the mentioned resistance area.
Technical Analysis: Euro faces strong resistance ahead of 0.8585
EUR/GBP trades at 0.8573, holding in a neutral, slightly capped stance with bulls contained below the top of a triangle pattern, in the 0.8580-0.8585 area. Momentum indicators show a lack of clear bias, with the 4-hour Relative Strength Index (14) wavering around the key 50 level, and the Moving Average Convergence Divergence (MACD) flat near the zero line.
Triangles are often continuation patterns, and, in this case, a bullish breakout is favoured. Above 0.8585 (July 30 high), the next target is the late June lows just above 0.8600. The triangle's measured target is at the June 26 high, at the 0.8630 area.
Bearish attempts, on the contrary, are seen contained at the 0.8560 area, where the triangle bottom crosses Tuesday's low, and below here, at the August 25 low, of 0.8546.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Euro Price Today The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the New Zealand Dollar.
USDEURGBPJPYCADAUDNZDCHFUSD0.21%0.16%-0.37%0.18%0.06%0.94%0.20%EUR-0.21%-0.06%-0.57%-0.03%-0.15%0.70%-0.00%GBP-0.16%0.06%-0.50%0.03%-0.10%0.74%0.05%JPY0.37%0.57%0.50%0.55%0.42%1.27%0.57%CAD-0.18%0.03%-0.03%-0.55%-0.13%0.72%0.02%AUD-0.06%0.15%0.10%-0.42%0.13%0.85%0.16%NZD-0.94%-0.70%-0.74%-1.27%-0.72%-0.85%-0.69%CHF-0.20%0.00%-0.05%-0.57%-0.02%-0.16%0.69% 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 Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
Pound-Australian Dollar could slip back if Australian GDP reinforces RBA hike expectations, although renewed risk aversion may keep the Aussie under pressure. The Pound to Australian Dollar (GBP/AUD) exchange rate trended higher on Tuesday as a cautious market mood weakened demand for risk-sensitive assets like the 'Aussie'.
At the time of writing, GBP/AUD was trading at AU$1.8958. Up around 0.3% from the start of Tuesday’s opening levels.
Latest — Exchange Rates:
Pound to Australian Dollar (GBP/AUD): 1.889968 (+0.03%)
Pound to Dollar (GBP/USD): 1.352508 (-0.17%)
DAILY RECAP:
The Australian Dollar (AUD) faced modest selling pressure on Tuesday as renewed military tensions between the US and Iran triggered a deterioration in market risk appetite.
The two sides exchanged strikes for the first time in several weeks, quashing hopes for a diplomatic solution to the crisis.
The escalation triggered a fresh rise in oil prices and prompted investors to adopt a more defensive stance.
However, the pressure on the Australian Dollar was partially offset by some encouraging Chinese economic data. China’s private RatingDog Manufacturing PMI rose to 51.5 in August from 50.9 in July, comfortably exceeding expectations and likely feeding greater demand for Australian exports.
While able to appreciate against its more risk-sensitive currencies, the Pound (GBP) traded in a relatively narrow range against most of its other peers on Tuesday as UK markets reopened following Monday’s bank holiday to a sharp rise in government borrowing costs.
UK 10-year gilt yields climbed to around 5.24% - their highest level since 2008 - as rising oil prices and renewed concerns over inflation fuelled expectations that central banks may need to maintain tighter monetary policy.
Elsewhere, an upwards revision to the UK's manufacturing PMI in August appeared to have little material impact on Sterling.
Near-Term GBP/AUD Forecast: Steady GDP Print to Lift the 'Aussie'? Turning to mid-week trade, the Pound Australian Dollar exchange rate may be pressured by the publication of the UK's latest GDP figures.
Wednesday's data is expected to show the Australian economy continued to expand at a steady pace of 0.3% in the second quarter of 2026.
While below the blistering pace of growth set at the end of 2025, the expansion should still be enough to underpin bets that the Reserve Bank of Australia (RBA) will deliver an interest rate hike later this month.
Meanwhile, in the absence of any notable UK economic indicators, any movement in the Pound through the middle of the week is likely to be dictated by wider market trends.
Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.
