Track market-moving stories before they get noisy

Societe Generale analysts Michael Haigh and Jeremy Sellem describe a broad-based Gold bull market in 2026, driven by ETFs, futures and options positioning. They highlight strong physical ETF inflows, near-record futures exposure by money managers and a structurally bullish options skew. The report stresses that multiple independent demand channels are reinforcing each other, supporting a constructive stance on Gold over the medium term.

Bullish signals across all channels"Gold has entered a new phase of its 2026 bull run, one defined less by speculative momentum and more by broad-based, structural conviction across every category of market participant. What began as a geopolitical shock, evolved over the following months into something far more durable: a synchronised build-up of physical, futures, and options exposure that now spans retail investors, professional money managers, and derivatives traders alike."

"In August, gold ETFs registered a substantial 201 tonnes of net inflows, marking the third-largest monthly addition on record in tonnage terms after now famous world events: February 2009 and the stimulus package announced by the newly inaugurated Obama administration, and March 2020 with the start of the lockdown for Covid globally. This month's inflow surpassed the strong inflows recorded in March 2022 following Russia's invasion of Ukraine and in September 2012 after the Federal Reserve's announcement of QE3."

"In notional exposure terms (contracts x price x contract size), money managers' net positioning reached the second-largest long exposure on record, behind only January 2026, when gold broke through $5,400/oz to an all-time high. This time, with prices roughly $1,000/oz lower, the scale of the dollar exposure is even more striking: it is no longer simply a price story."

"Overall, investors appear to be pricing near-term uncertainty via puts while steadily building call exposure further out the curve, consistent with a constructive medium-term outlook for gold."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

The USD/JPY and DXY charts are approaching defining support levels, creating a conflict between short-term weakness, long-term bullish continuation risks, and the risk of a broader structural bearish shift.

Several factors are contributing to volatility risks across both charts:

Rising U.S. Treasury yields: The U.S. 10-year Treasury yield recently reached a new 2026 high near 4.8%, widening the interest-rate differential between the United States and Japan 
Bank of Japan rate-hike expectations: Markets are pricing in the possibility of a 25-basis-point rate hike at the BOJ meeting scheduled for September 17–18. This expectation is providing short-term support for the yen.
Crude oil and geopolitical risks: Crude oil prices have broken above a 7-month resistance level, increasing concerns about supply disruptions and inflation. This could support the dollar through safe-haven demand, although persistently higher oil prices could also raise concerns about global growth.
As of September 7, the fundamental and technical picture remains tilted towards geopolitical risks. Short-term dollar weakness is visible, but the broader risk narrative continues to support the possibility of renewed dollar strength if inflation, yields, and geopolitical tensions remain elevated.

DXY Price Outlook: Monthly Time Frame — Log Scale

Source: TradingView

Despite the DXY breaking below its 2026 uptrend, signaling short-term weakness, the longer-term structure remains tilted to the upside.

The key downside levels I am watching align with the Fibonacci retracement levels of the 2026 uptrend: 98.50, 98, 97 and 95.50. The 95.50 area is the defining barrier between a structural breakdown of the 18-year uptrend and a potential continuation of the longer-term bullish structure.

On the upside, reclaiming the 2026 uptrend near 100.30, followed by a move above 101 and 101.70, would restore the dollar’s strength against major markets. Such a move could lift the DXY toward new 2026 highs and add further pressure on Japanese officials facing persistent yen weakness.

This situation could become more critical if the interest-rate differential between the United States and Japan continues to widen.

Key DXY Scenarios
Bullish scenario: A recovery above 100.30, followed by a breakout above 101 and 101.70, would signal renewed dollar strength and support a move toward new yearly highs.

Bearish scenario: A sustained breakdown below 98.50 and 98 would increase the risk of a deeper correction toward 97 and 95.50. A clear break below 95.50 would confirm a more significant structural shift and challenge the long-term bullish trend.

USD/JPY Price Outlook: Weekly Time Frame — Log Scale

Source: TradingView

Technically, USD/JPY is breaking below a 3-month support level, signaling short-term yen strength while simultaneously approaching an uptrend support zone that has been in place since 2023.

Key Patterns and Scenarios in Focus
The breakdown below the April 2025–July 2026 channel points to short-term weakness and aligns with the Fibonacci retracement levels of that advance.

Price action is currently testing a breakdown below 154.80, the 38.2% retracement level. A sustained move below this level could target 152, corresponding to the 50% retracement, followed by 149 near the 61.8% retracement level.

The 149 area could become an important zone for a potential long-term rebound, aligning with the golden ratio, the broader 2023–2026 uptrend and increasingly oversold momentum conditions.

Bearish scenario: A clear breakdown below 149 would confirm broader structural weakness and increase the risk of a deeper correction in USD/JPY.

Bullish scenario: Holding above 149 would preserve the broader bullish structure. On the upside, reclaiming the 2026 uptrend boundaries near 158.40, 161 and 164 would restore USD/JPY strength and expose the upper channel boundary near 170.

Short-term weakness, the potential for long-term dollar strength and persistent geopolitical risks are shaping the outlook for USD/JPY and the DXY.

The next major catalysts include the U.S. CPI report on Friday, the BOJ meeting on September 17–18 and the FOMC meeting on September 16. The reaction in Treasury yields and the direction of crude oil prices will remain critical in determining whether the current weakness develops into a deeper structural decline or becomes another correction within a broader bullish trend.

Written by Razan Hilal, CMT

Follow on X: @Rh_waves

ING’s Warren Patterson and Ewa Manthey highlight that central banks, led by China and Poland, continued net Gold purchases in July, supporting structural demand despite a slower pace than last year. They add that Gold prices rose over 2% after weaker US employment data and comments from Federal Reserve official Christopher Waller suggesting openness to holding rates steady if inflation behaves.

Official demand and Fed rhetoric support"Central banks continued to add to gold reserves in July, reporting net purchases of 23 tonnes, according to World Gold Council data. Emerging market central banks remained the main buyers, led by China and Poland. China's central bank extended its buying streak to 21 consecutive months, adding 20 tonnes."

"Although central bank buying has slowed compared to a year ago, official sector demand continues to provide support for the gold market. Ongoing reserve diversification efforts among emerging economies should help sustain structural demand, even if purchases moderate from recent highs."

"Gold prices rose more than 2% on Thursday following a weaker-than-expected ADP employment report on Wednesday. Comments from US Federal Reserve official Christopher Waller, suggesting he is open to keeping rates on hold at the next FOMC meeting (assuming no surprises on the inflation front), provided an additional boost."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Why Brent’s break above $97 is failing to lift Dollar, and why Japan, not oil, is setting today’s currency direction What’s happening: USD/JPY broke decisively through 157.99 to around 156, bringing the 155 area back into range, as Yen’s rally gathers fresh momentum from speculation that Japan’s roughly $2 trillion GPIF could raise its domestic bond allocation, on top of an already-hawkish BoJ repricing. At the same time, Brent climbed to an intraday high around $97.62, its strongest level in six weeks, as the US-Iran conflict shows signs of extending well beyond 2026.

Why it matters: Brent above $97 and a conflict that could extend into 2027 would normally form a potent Dollar-supportive combination through inflation and rates. Instead, Dollar is broadly weaker because Japan has taken control of the FX narrative. Oil is still setting global inflation risk, but today, Japan is setting currency direction.

Yen Takes Over as GPIF Speculation Adds to BoJ Repricing Yen extended its powerful rally on Thursday, sending USD/JPY decisively through 157.99 to around 156 and putting the 155 area back within reach. Latest leg appears to have received fresh fuel from speculation surrounding Japan’s roughly $2 trillion Government Pension Investment Fund. GPIF held an unusual management committee meeting on August 21, its first August meeting since 2019, and revisited discussion around its basic portfolio only five months after a March assessment concluded that a review was unnecessary.

Market interest centers on whether GPIF could eventually raise its strategic allocation to domestic assets, particularly government bonds. Domestic bonds currently carry a 25% target allocation, alongside 25% each for domestic equities, foreign bonds and foreign equities. The timing is significant because Japan’s 10-year government bond yield has climbed roughly one percentage point since March and briefly reached 3.015% this week, highest since 1996. Higher domestic yields are already changing relative attractiveness of Japanese assets, with Japanese investors reducing overseas bond exposure this year. A larger GPIF domestic allocation would reinforce that repatriation theme and potentially relieve some upward pressure on JGB yields.

That speculation is adding to a much broader Yen-positive repricing already underway. BoJ officials have become increasingly explicit about further tightening, with markets now focused not only on a possible September hike but on a faster cycle over coming year. Japan’s top currency diplomat Atsushi Mimura added another layer of caution Thursday, saying he was “neither satisfied nor reassured” by recent Yen developments and that authorities remained on “a state of heightened alert.” He declined to confirm whether officials had conducted a rate check. Traders nevertheless continue to attribute Yen strength primarily to BoJ tightening expectations rather than fresh intervention.

The 155 level is critical. USD/JPY is approaching the same territory reached after July’s record intervention campaign, which cost Japan roughly $96.5bn and included rare US participation. The 155.22 area marks July’s post-intervention low, while 155.01 provides nearby technical support. This time, however, pair is approaching those levels organically rather than through any confirmed official Yen buying.

Why the 155 Level Matters Japan’s 10-year JGB yield: briefly reached 3.015% this week, highest since 1996. July’s record intervention: cost roughly $96.5bn, included rare US participation. 155.22: July’s post-intervention low. 155.01: nearby technical support. Mimura: “neither satisfied nor reassured,” authorities on “a state of heightened alert.” July’s Intervention-Driven Move vs. Today’s Organic Approach to 155 July’s Intervention Today How USD/JPY reached this territory Record intervention, cost roughly $96.5bn, included rare US participation Approaching organically, no confirmed official Yen buying Key levels 155.22 (post-intervention low), 155.01 (support) Same levels now back within reach Attributed driver Direct official Yen buying BoJ tightening expectations and GPIF speculation Dollar Weakens Even as Oil Sends a Normally Bullish Signal Yen’s surge has become dominant force in FX, with Dollar lower against all major counterparts despite a backdrop that would normally be considerably more supportive. In Dollar index specifically, Yen’s sizeable weighting means its appreciation directly pulls index lower. More broadly, modest easing in Treasury yields has allowed Dollar weakness to spread across EUR, GBP and CHF as traders focus on Japanese policy repricing rather than extending this week’s US rates trade.

That creates today’s most counterintuitive cross-asset signal. Brent has broken above $97 to fresh six-week highs as US-Iran conflict intensifies, yet Dollar is falling. Earlier this week, higher oil transmitted relatively cleanly through inflation fears into higher Treasury yields and firmer expectations for Fed tightening. That channel has not disappeared, but it is being overshadowed in FX by Yen’s much larger independent move and the pause in US yields.

Wednesday’s softer ADP report, with private payrolls rising only 38K, contributed to that pause in further hawkish repricing, but it is not the principal driver of Thursday’s Dollar move. Initial jobless claims subsequently matched expectations at 206K, offering little additional direction. Markets still attach substantial probability to September Fed hike, leaving Friday’s NFP as decisive test. For now, more revealing question is not simply why Dollar is weaker, but why Brent above $97 has failed to make Dollar stronger. Answer lies in Japan: Yen and BoJ repricing have become larger currency-market forces today.

Oil Story Shifts From Escalation to Duration Brent meanwhile climbed to an intraday high around $97.62, extending this week’s rally and reaching its strongest level in six weeks. But narrative is beginning to shift. Earlier phases of renewed fighting were dominated by immediate questions over each US strike, Iranian retaliation and potential disruption to Strait of Hormuz. Markets are now considering a more difficult possibility: conflict and impaired regional energy flows could persist into 2027. Recent market commentary has explicitly moved toward that longer time horizon, with Capital Economics expecting restoration of Middle East energy flows to be delayed until early next year and forecasting Brent around $100 by end-2026.

That matters more for inflation than another isolated military exchange. A conflict measured in additional months rather than days would prolong pressure on shipping, inventories and refined-product markets, increasing chances that energy inflation becomes persistent enough to influence central-bank decisions. Iranian retaliation has also widened geographically, while US officials continue to signal that military pressure could intensify again even as Washington tries to limit escalation ahead of November elections. Reuters reported that administration officials see possibility of more intense attacks after midterms, underscoring absence of a clear near-term exit from a war now in its seventh month.

The closing contradiction is therefore striking. Brent above $97 and rising concern that US-Iran conflict could extend into 2027 would normally form a potent Dollar-supportive combination through inflation and rates. Instead, Dollar is broadly weaker because Japan has taken control of FX narrative. Oil is still setting global inflation risk, but today, Japan is setting currency direction.

Related Coverage Yen & Precious Metals Deep Dives Read why Silver’s rebound from 63.27 still depends on holding 62.54-62.92 to keep its five-wave recovery from 54.77 alive ahead of Friday’s NFP: Silver’s Correction Has Reached Its Line in the Sand — What Happens Next?. See why Friday’s NFP creates an asymmetric setup for USD/JPY, with weak data opening a clearer path toward 155 than strong data does above 160: USD/JPY Tumbles Under the Shadow of Intervention, Faces Asymmetric NFP Test. US Data Deep Dive Read why jobless claims matching expectations at 206K still leaves Friday’s NFP as the clearer labor-market signal: US Initial Jobless Claims Rise from 204K to 206K. Global Inflation Deep Dives See why Eurozone PPI’s swing to +1.6% m/m was driven largely by a 5.6% jump in energy prices, with annual producer inflation accelerating to 5.8%: Eurozone PPI Surges 1.6% M/M as Energy Drives Renewed Producer Inflation (full Eurostat release). Read why Swiss CPI’s jump to 0.8% was driven mostly by energy and imported prices, with core inflation holding at 0.4%: Swiss CPI Jumps to 0.8%, but Energy Drives Much of Inflation Surprise. Global PMI Round-Up See why UK services hitting a four-month high still came with employment falling for a 23rd straight month: UK PMI Services Hits Four-Month High as Cost Pressures Reaccelerate. Read why Eurozone’s composite PMI holding at an eight-month high alongside stalled disinflation is strengthening the case for ECB tightening: Eurozone PMI Composite Holds Firm as Sticky Prices Strengthen ECB Tightening Case. See why Japan’s record composite selling-price inflation is adding to the case for another BoJ hike even as growth accelerates: Japan PMI Growth Accelerates as Record Selling Prices Strengthen BoJ Hike Case. Read why Australian services confidence hit a six-month high even as fuel and wage costs kept input inflation elevated: Australia PMI Services Holds Firm at 53.2 as Confidence Rises but Costs Stay High. See why China’s services and composite PMI gains reflect stronger domestic demand and sustained hiring: China RatingDog PMIs Strengthen as Services and Employment Gain Momentum. Frequently Asked Questions Q: Why is Dollar falling even though oil just broke above $97? A: Because Yen’s much larger, independent move is overwhelming the usual oil-to-Dollar transmission channel. Higher oil normally supports Dollar through inflation fears feeding into higher Treasury yields and firmer Fed tightening expectations, and that channel hasn’t disappeared. But Yen’s sizeable weighting in the Dollar index, combined with a pause in US yields, means Japanese policy repricing is currently the bigger force in FX. The real question today isn’t why Dollar is weaker, it’s why Brent above $97 hasn’t made it stronger, and the answer is Japan.

Q: What is GPIF and why does speculation about it matter for Yen? A: GPIF is Japan’s roughly $2 trillion Government Pension Investment Fund. It held an unusual management committee meeting on August 21, its first August meeting since 2019, revisiting its basic portfolio just five months after concluding in March that no review was needed. Markets are watching whether GPIF could raise its 25% target allocation to domestic bonds. A larger domestic allocation would reinforce the repatriation trend already underway as Japanese investors reduce overseas bond exposure, adding further support to Yen and potentially easing some upward pressure on JGB yields.

Q: How is this approach to 155 different from July’s intervention? A: July’s move to the 155 area came from a record, roughly $96.5bn intervention that included rare US participation. This time, USD/JPY is approaching the same 155.22 and 155.01 levels organically, with no confirmed official Yen buying. Traders are attributing the move to BoJ tightening expectations and GPIF speculation rather than direct intervention, even though currency diplomat Mimura says authorities remain on “a state of heightened alert.”

Key Takeaways USD/JPY broke through 157.99 to around 156: Bringing the 155 area back into range for the first time since July’s intervention. GPIF speculation is adding fresh fuel to Yen’s rally: Markets are watching whether Japan’s roughly $2 trillion pension fund raises its 25% domestic bond allocation after an unusual August 21 committee meeting. Japan’s 10-year JGB yield briefly hit 3.015% this week: The highest since 1996, up roughly one percentage point since March. Currency diplomat Mimura kept intervention rhetoric alive: Saying he’s “neither satisfied nor reassured,” though traders still attribute Yen strength to BoJ tightening expectations, not intervention. Brent climbed to a six-week high around $97.62: As the oil narrative shifts from immediate escalation questions to concern the conflict could extend into 2027. Reuters reported officials see possible intensified attacks after the US midterms: Underscoring no clear near-term exit from a conflict now in its seventh month. Dollar is broadly weaker despite a combination that would normally support it: Brent above $97 and extended conflict risk usually mean higher inflation and rates support for Dollar, but Japan has taken control of the FX narrative instead. Unlike July, today’s approach to 155 is organic: No confirmed official Yen buying, unlike July’s roughly $96.5bn intervention with rare US participation. What to Watch Next Friday’s US nonfarm payrolls report is the decisive near-term test for Dollar, following a softer ADP print and in-line jobless claims. Watch whether USD/JPY breaks below 155, further signals on GPIF’s portfolio review, and whether Brent extends toward $100 as Capital Economics and others push their Middle East normalization timelines further into 2027.

ActionForex

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

powered by

AUD/USD

Sell AUD/USD. Higher odds of both RBA and Fed hikes push the market toward tighter USD policy and less room for AUD to rally; strong Aussie data is already “priced,” while the article flags elevated inflation and renewed oil/energy pressure that can keep both central banks hawkish. Technicals also point to a bearish reversal (rising wedge convergence, PPO bearish crossover, RSI rolling over). Target 0.700 support.

Key Risk: A sharp risk-off move that weakens the USD (or a surprise dovish Fed/RBA shift) that drives AUD/USD back above 0.7207.

Brent-linked AUD

Sell AUD exposure via AUD/JPY (or AUD futures). The news ties the hawkish rate repricing to higher oil after US-Iran activity; that supports global growth but also keeps inflation sticky, which tends to keep JPY relatively supported versus high-beta AUD when rates are uncertain. With AUD/USD set up to break lower, AUD/JPY should follow on the same rate-and-risk repricing.

Key Risk: Oil spikes further and triggers a broad commodity/risk rally that lifts AUD/JPY despite the wedge/oscillator bearish setup.

The Australian dollar held firm today, September 3rd, as investors adjusted their RBA and Federal Reserve expectations for the year. The AUD/USD pair was trading at 0.7165, a few points below the August high of 0.7207. 

Traders are bracing for interest rate hikes from the Federal Reserve and the Reserve Bank of Australia (RBA) happening as soon as this month.

Polymarket gives the odds of RBA’s rate hike happening in September rose to 67%. These odds jumped after the US and Iran resumed their kinetic activity, which led to higher oil prices. 

Australia has also published strong macro numbers this week. An S&P Global report showed that the services PMI came in at 53.2 in August, higher than the expected 52.9. A PMI reading of 50 and above is usually a sign that a sector is growing. The composite PMI came in at 52.7, also higher than the expected 52.50.

Another report released on Wednesday showed that the Australian economy expanded by 2.1% in the second quarter, higher than the expected 1.8%. It grew by 0.4% in Q2 after growing by 0.3% in Q1 on a QoQ basis. 

This growth happened even as the Reserve Bank of Australia (RBA) became the most hawkish central banks this year. It has already delivered three rate hikes this year, with officials leaving the door open for more hikes.

A key concern is that Australia’s inflation has remained at an elevated level in the past few months. This trend will likely continue now that the US and Iran have restarted their kinetic activity, leading to higher energy prices. Brent, the global benchmark, rose to $95.68, while the West Texas Intermediate (WTI) rose to $91.

The same situation is happening in the US, where odds that the Fed will hike rates this month have jumped to 55% on Polymarket. These odds soared after Kevin Warsh delivered a highly hawkish statement at the Jackson Hole Symposium.

In it, he hinted that the bank was concerned about the state of inflation, which has remained above the 2% target in the past five years.

Focus now shifts to the upcoming US nonfarm payrolls (NFP) report that will provide color on the labor market. Economists expect the data to show that the economy created over 80k jobs in August this year.

AUDUSD chart | Source: TradingView

The daily chart shows that the AUD/USD pair may be on the verge of a bearish reversal in the coming days. For one, it has formed a rising wedge pattern whose two lines are about to converge. 

Also, the two lines of the Percentage Price Oscillator (PPO) have made a bearish crossover, while the Relative Strength Index is pointing downwards.

Therefore, the most likely scenario is where the AUD/USD pair falls, potentially to the key support of 0.700.

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.)

Gold (XAU/USD) resumed its decline on Tuesday, following a flat performance on Monday, reaching fresh two-week lows at $4,375 so far, posting a nearly 7% decline from last week’s peak, near $4,700. Precious metals are struggling this week as hawkish comments by Federal Reserve (Fed) Chairman Kevin Warsh at the Jackson Hole summit on Friday provided a fresh boost to the USD.

Strategists at Brown Brothers Harriman note that the US Dollar has “recovered most of yesterday’s pullback” as policy expectations remain firmly skewed toward further tightening. They also highlight that “Fed funds futures price in 67% odds of a 25bps hike on September 16 and imply 60bps of tightening over the next twelve months,” with market “pricing [set to] remain elevated into the September meeting.”

In their view, however, “August CPI on September 11” will be the “decisive test” to see whether those rate expectations – and the Dollar’s recovery – can be sustained.

Technical Analysis: Next downside target is at $4,315

XAU/USD trades at $4,378, with momentum indicators in the daily chart entering bearish territory. The Relative Strength Index (RSI) is testing levels below the key 50 line, and the Moving Average Convergence Divergence (MACD) has slipped below zero, pointing to increasing downside pressure.

Immediate support is seen at the mid-August lows between $ 4,310 and $4,330. Further down, the August 6 low, near $4,225, would come into view. On the topside, previous support at the $4,450 area has now turned resistance and is likely to test rallies, ahead of the 200-day simple moving average (SMA) at $4,530 and 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.

The price of Gold’s 3% Warsh-driven selloff has put Crédit Agricole’s $5,000 year-end forecast to a tougher test, but the bank’s debasement thesis remains intact. The Gold price in US Dollars (XAU/USD) ended Friday around $4,457 after Fed Chair Kevin Warsh’s Jackson Hole speech triggered the sharpest setback of the recent rally.

Gold fell 2.99% on Friday and is now almost $240 below August’s $4,696 high, although bullion still gained more than 10% over the month.

Warsh warned that the Fed still had “work to do” unless inflation moved convincingly towards 2%, sending September rate-hike expectations sharply higher and pushing the Dollar up. Gold subsequently suffered a heavy rate-driven selloff.

That move cuts directly across the near-term argument behind Crédit Agricole’s bullish call, but not necessarily the structural one.

The bank says gold has become “one of the key beneficiaries” of efforts by Washington to restrain long-dated Treasury yields, which worsened “the risk-reward trade-off for UST investors” and increased bullion’s appeal as a safe haven.

Crédit Agricole argues that these policy moves have “fanned US inflation fears and lowered US real yields”, strengthening gold’s role as a currency-debasement hedge.

It also sees geopolitics feeding the same trend, with the weaponisation of the Dollar through sanctions encouraging renewed reserve diversification.

“We remain long XAU/USD as a trade idea,” the bank says, adding that it continues to forecast gold at $5,000 by year-end with further gains in 2027.

Image: Gold price in US Dollars one-month chart The chart shows gold rallied from around $4,025 to nearly $4,700 before Friday’s collapse took it back towards its rising 20-day moving average.

We recently highlighted the return of ETF and futures buyers to gold, while BofA’s separate $5,000 forecast sits on a longer 2027 horizon.

Crédit Agricole’s call is more demanding.

From $4,457, a year-end move to $5,000 requires roughly 12% upside.

Warsh has made that path harder, but the bank’s forecast was always built on fiscal, Treasury and de-dollarisation risks as much as Fed easing.

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

TD Securities’ Bart Melek notes that Gold has rallied sharply as recent U.S. Dollar weakness and concerns over Fed credibility and Treasury bond-market intervention drive fresh long positioning. Worries about America’s fiscal situation are reviving the USD debasement trade and may continue to support Gold, although a move toward TD Securities’ $5,350/oz target is still considered premature.

Fresh longs chase debasement trade"Traders added to gold exposure as the recent U.S. Dollar weakness, Fed Credibility and Treasury Bond Intervention concerns come into focus."

"Worries about America's fiscal situation are once again resurrecting the USD debasement narrative, which, in turn, is energizing gold bugs."

"Based on Treasury Dept statements, market participants believe the government bond market interference may get even more aggressive. At this stage, gold may continue to respond to the weaker USD."

"A move to our $5,350/oz target is a little premature for now."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Silver (XAG/USD) accelerates its advance on Friday and trades around $69.75 at the time of writing, up 2.41% on the day. The white metal reaches its highest level in two months and is on track for a weekly gain of more than 7%, mainly supported by persistent weakness in the US Dollar (USD).

The main catalyst behind Silver’s rally this week is the United States (US) Department of the Treasury’s surprise announcement of its debt buyback program. The Treasury plans to at least double its purchases of longer-dated government securities in an effort to contain borrowing costs. The decision initially triggered a sharp decline in US Treasury yields and the US Dollar, mechanically increasing the appeal of Dollar-denominated precious metals.

US Treasury yields have since recovered some of their losses, but the rebound has not been enough to halt Silver’s advance. Investors appear more concerned about the longer-term implications of US fiscal policy, including rising government debt, large budget deficits and the possibility that authorities may favor looser financial conditions at the expense of the US currency.

Commerzbank argues that the Treasury’s announcement suggests that US authorities may prefer a weaker Dollar rather than accepting persistently higher long-term interest rates. This perception adds a headwind for the Greenback and continues to support Silver.

The monetary policy outlook provides additional support. Recent US employment and inflation data have reduced expectations of an imminent interest rate hike by the Federal Reserve (Fed). Lower interest rates tend to benefit Silver, which offers no yield, while potentially adding further pressure on the US Dollar.

Investors now turn their attention to the preliminary August S&P Global Purchasing Managers Indices (PMIs). The market consensus expects the Manufacturing PMI to ease slightly to 53.8 from 53.9 in July, while the Services PMI is forecast to decline to 54 from 54.6. Weaker-than-expected figures could increase pressure on the US Dollar and provide further support to Silver.

However, inflation risks remain present. Rising Oil prices linked to tensions in the Middle East could keep US inflation elevated and reignite speculation about a Fed rate rise, bolstering the USD. A sustained rebound in US Treasury yields could also become a headwind for precious metals following their strong recent gains.

XAG/USD technical analysis

In the one-hour chart, XAG/USD trades at $69.83, maintaining a bullish near-term bias as price holds above the upward-sloping trend-line support around $68.03 and comfortably above the 100-period simple moving average (SMA) at $66.02 and the 200-period SMA at $65.56. The clustering of underlying levels at $67.75 and $66.60 reinforces a constructive structure, while the Relative Strength Index (RSI) at 70.05 hints at mildly overbought conditions that could slow the advance rather than immediately reverse it.

On the topside, immediate resistance is located at the psychological $70.00 handle, where a sustained break would open the way for further gains in the short term. On the downside, the first meaningful support emerges at the reclaimed trend-line zone near $68.03, followed by horizontal support at $67.75 and $66.60, with the 100-period SMA at $66.02 and the 200-period SMA at $65.56 providing deeper trend support if corrective pressure extends.

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

On 19 August, the US Treasury announced that it would double the volume of long-term government bond buybacks. The measure led to a noticeable decline in yields at the longer end of the curve and forms part of the Treasury’s broader efforts to contain pressure on long-term borrowing costs. These efforts include market interventions and calls for the Federal Reserve to expand the limits of the FIMA repo facility.

Lower Treasury yields improve the relative appeal of precious metals, which do not generate interest income, providing direct support for silver. Industrial demand is another important factor. Chinese imports of silver-containing ores rose 62.5% year-on-year in June amid expanding production of solar panels and power-grid equipment.

Technical Analysis of Silver

Since 17 July, XAG/USD has been moving within a pronounced uptrend on the four-hour chart. In the upper portion of this advance, a pattern resembling a broadening triangle emerged in mid-August. Unlike a conventional triangle, its boundaries widened rather than converged, reflecting increasing volatility during the consolidation phase.

On 20 August, the price broke above the formation and continued to hold above the current market profile. The breakout candle was accompanied by a noticeable increase in vertical volume compared with the preceding consolidation bars, adding some confirmation to the move.

Following the breakout, silver moved above the profile’s upper boundary at $66.58. If the bullish momentum persists, the next major upside reference is the red resistance level at $69.74.

A return inside the profile would shift attention to the cluster of two important levels: the Point of Control (POC) at $65.165 and the lower profile boundary at $64.345. Their proximity makes this area particularly important for the short-term outlook. If sellers push the price through this cluster, the next potential support could be found around the green level at $62.700.

The RSI + MAs indicator currently shows readings of 66, 56 and 56. The oscillator is trading above the neutral zone, while both moving averages remain below its upper boundary and are only beginning to approach a potential breakout.

Key Takeaways The breakout above the broadening triangle on increased volume initially points towards further upside, but maintaining prices above the market profile will require additional confirmation.

The $66.58 level is therefore likely to remain important in the near term: holding above it would favour continuation towards $69.74, while a return below the profile could bring the 65.165–64.345 area back into focus.

The broader outlook will also remain sensitive to the direction of US Treasury yields. A continued decline in yields could provide further support for silver, while a renewed rise in long-term yields could limit the metal’s upside.

Start trading commodity CFDs with tight spreads (additional fees may apply). Open your trading account now or learn more about trading commodity CFDs with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

FXOpenhttps://www.fxopen.com/

FXOpen is a global Forex and CFD Broker, founded in 2005 by a group of traders. With over 16 years of experience, the company has gained an excellent reputation a major brokerage that continues to expand rapidly. The broker offers a choice of platforms, including the popular MT4 and MT5 platforms, with a wide range of trading instruments with spreads from 0.0 pips: 600+ FX, index, share, commodity and cryptocurrency CFDs. FXOpen also provides its own PAMM technology, allowing clients to benefit from the strategies of experienced traders with a proven track record of successful trading and guarantees automatic distribution of profit and loss between the strategy provider and the strategy followers. CFDs are complex instruments and come with a high risk of losing your money. PAMM is only available in certain jurisdictions. Cryptocurrency CFDs are not available to Retail clients at FXOpen UK.

The Canadian Dollar strengthened as oil prices extended their advance and renewed pressure on the US Dollar pushed USD/CAD towards fresh August lows. The Canadian Dollar gained further ground on Thursday, with firmer crude prices and a softer US currency reinforcing a move that has gathered pace over the past week.

The US Dollar to Canadian Dollar (USD/CAD) exchange rate traded around 1.3776, down 0.25% on the day and 1.09% lower over five sessions.

Latest — Exchange Rates:

Pound to Canadian Dollar (GBP/CAD): 1.880004 (+0.10%)

Euro to Canadian Dollar (EUR/CAD): 1.610518 (-0.11%)

Dollar to Canadian Dollar (USD/CAD): 1.37752 (-0.26%)

WTI crude was also up more than 1% near $85.58 a barrel as the Strait of Hormuz standoff kept supply risks elevated.

Oil Prices and Fed Expectations Support the Loonie The Canadian currency has benefited from the combination of higher energy prices and fading expectations that the Federal Reserve will deliver another near-term rate increase.

Reuters market commentary highlighted both themes as supportive for the Loonie, while Wednesday's US Treasury decision to increase long-dated bond buybacks also pulled US yields lower and weighed on the Dollar.

The move leaves USD/CAD testing an important area around 1.3770 after falling more than 2% over the past month.

ING strategists Chris Turner and Francesco Pesole remain cautiously constructive on the Canadian Dollar, saying that “broader USD weakness can still drive USD/CAD down to 1.38 by year-end.”

MUFG's latest projections similarly envisage USD/CAD easing from 1.41 in the third quarter towards 1.39 by year-end and 1.36 by the second quarter of 2027.

The immediate Canadian Dollar outlook will remain closely tied to oil and US rate expectations. A sustained break below 1.3770 would strengthen the case for a deeper USD/CAD retreat, while renewed Treasury-yield pressure would threaten the latest gains.

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

Silver (XAG/USD) stabilizes around $63.45 on Wednesday, up 0.16% on the day at the time of writing. The white metal is attempting to regain its footing after hitting an intraday low of $62.19, initially extending the pullback that followed Tuesday’s rejection from the $66.50 area.

Silver remains under pressure in a cautious market environment as investors monitor the deteriorating situation in the Middle East. The Memorandum of Understanding between the United States (US) and Iran expired on Monday, while US President Donald Trump confirmed on Tuesday that no talks with Tehran are currently taking place.

Disruptions to maritime traffic through the Strait of Hormuz are also keeping tensions elevated in the energy market, reinforcing concerns about the conflict's inflationary consequences. This prospect could complicate the task of the Federal Reserve (Fed) and limit its room to tighten monetary policy.

Investors now await the Minutes of the Federal Open Market Committee (FOMC) July meeting, due on Wednesday at 18:00 GMT, for fresh clues about the path of US interest rates.

Since that meeting, weaker-than-expected labor market and inflation data have reduced expectations of a September rate hike. According to the CME FedWatch tool, markets now price in only a 32% chance of an increase at the next meeting. This shift helps limit pressure on precious metals, which tend to benefit from expectations of less restrictive monetary policy.

At the same time, inflation risks stemming from the energy shock continue to support the possibility of further monetary tightening over the longer term. US Treasury yields therefore remain elevated despite a modest decline on Wednesday, limiting the appeal of non-yielding Silver.

The release of the Fed Minutes could therefore provide the next catalyst for Silver as markets assess the balance between softer US economic data, inflation risks stemming from the Middle East conflict and the future path of interest rates.

XAG/USD technical analysisIn the one-hour chart, XAG/USD trades at $63.46, retaining a capped near-term tone as it holds beneath the 100-period simple moving average (SMA) at $64.74 and the 200-period SMA at $64.65. The proximity of the immediate horizontal barrier at $63.50 reinforces overhead supply just above spot, while the Relative Strength Index (RSI) at 44.51 stays below the neutral 50 line, hinting that recovery attempts could remain limited for now.

On the topside, initial resistance is located at $63.50, ahead of the 200-hour SMA at $64.65 and the 100-hour SMA at $64.74, with a stronger hurdle emerging at the prior horizontal cap near $66.80. On the downside, first support appears at $62.60, with a deeper cushion seen at $61.00, where buyers would be expected to show more interest if the current pullback extends.

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

TL;DR: Brent’s break above $90 is doing double duty for CAD/JPY — strengthening Canada’s terms of trade while pushing global bond yields higher and deepening Yen funding pressure — and this time Canada’s own data are contributing too, unlike June’s Yen-only rally.

CAD/JPY Has Found a Rare Double Tailwind Brent’s break above $90 is doing more than lifting Canadian Dollar. It is also pushing global inflation expectations and bond yields higher, adding pressure to Yen. For CAD/JPY, that creates an unusually clean setup: same US-Iran shock strengthens one side of cross while weakening other.

June 17 ceasefire framework formally expired on August 17 without renewal, leaving no clear diplomatic settlement in sight. Higher oil improves Canada’s terms of trade and supports petro-currency, while renewed energy and freight inflation keeps global yields elevated. For Yen, still one of market’s principal funding currencies, wider yield differentials reinforce carry pressure. Instead of two separate narratives, CAD strength and JPY weakness are being driven by same underlying shock.

This Time Canada Is Contributing Too That is important because CAD/JPY has rallied on Yen weakness before. Late-June advance eventually stalled because Canadian Dollar itself offered limited independent support. Current move starts from a stronger domestic backdrop.

May GDP rose 0.3% m/m, beating 0.2% forecast and expanding across 13 of 20 sectors. July labor data then surprised decisively, with employment jumping 75K against 15K expected and unemployment dropping to a two-year low of 6.4%. July CPI followed with headline inflation accelerating from 2.8% to 3.0% y/y, above 2.9% consensus, while Trimmed and Median CPI firmed to 1.9% and 2.0% respectively.

Gasoline was a substantial part of headline inflation surge, rising 25.7% y/y, and part of that effect is linked to tax treatment that rolls off in September. That argues against treating CPI as proof that BoC has already returned to a tightening path. But combined with stronger growth and employment, data have at least reopened hike discussion after it had largely disappeared. For CAD, that is enough to distinguish current rally from June’s mostly Yen-driven move.

Oil Shock Is Also Hurting Yen Through Bonds Global bond market supplies second leg. US 30-year yield has climbed to around 5.31%, highest in 19 years, while 10-year is near 4.74%. Germany’s 10-year Bund has reached about 3.22%, highest since 2011, and Canada’s 10-year recently touched 3.75%, a 26-month high.

Current rise in yields carries a stagflationary flavor rather than a straightforward growth signal. Hormuz disruptions and higher energy and freight costs are lifting inflation concerns and encouraging investors to price restrictive rates for longer. That is exactly environment in which Yen’s yield disadvantage becomes harder to ignore.

BoJ normalization may eventually narrow that gap, but global yields are moving higher in meantime. Until Japanese rates catch up more substantially, higher overseas yields continue to reinforce Yen-funded carry trades. Brent above $90 therefore creates a double effect for CAD/JPY: stronger Canadian terms of trade and greater funding pressure on Yen.

Brent Consolidation Will Tell Us Whether CAD Strength Is Real Best test of this rally may come when oil stops rising.

If Brent consolidates around $90–91 and CAD/JPY continues holding or extending gains, that would be strong evidence that Canadian Dollar’s domestic improvement is doing meaningful work. GDP, employment and CPI would then be providing enough support for CAD to carry rally even without another daily oil breakout.

If CAD/JPY instead stalls immediately whenever crude stops climbing, move would look more like June again: predominantly Yen weakness with limited independent CAD follow-through.

That gives current trade a falsifiable fundamental test. A durable move toward 120 should increasingly survive without requiring Brent to make new highs every session.

Japan Can Still Interrupt the Trade Main risk does not currently come from Canada. It comes from Japan.

USD/JPY is moving back toward 160 intervention-sensitive zone, reviving possibility of verbal or direct action from Japanese authorities. September 18 BoJ meeting also approaches with substantial probability of another rate increase already priced.

Either development could hit CAD/JPY even if oil remains high. Actual intervention would likely trigger broad Yen buying across crosses, while a BoJ hike would challenge carry mechanism more fundamentally.

That makes 120 a plausible target, but not a low-volatility one. Stronger oil and global yields are pushing Yen in exactly direction that increases likelihood of Japanese response.

ActionForex’s Technical View on CAD/JPY: Break of 117.50 Would Put 120.86 on Map Technical structure supports bullish case. CAD/JPY has decisively reclaimed 55-day EMA around 114.52, adding to argument that correction from 117.50 ended at 110.82 in a three-wave structure. That low held around 111.28, 38.2% retracement of larger rise from 101.24 to 117.50, preserving medium-term uptrend.

Near-term bias stays higher while 113.86 holds. 116.45 is first resistance and a firm break would strengthen case that rebound has enough momentum to retest 117.50. Decisive break of 117.50 would be more important, signaling likely resumption of broader uptrend and opening 120 psychological level, followed by 120.86, 61.8% projection of 101.24 to 117.50 from 110.82.

Break below 113.86 would postpone that bullish scenario and suggest correction from 117.50 is extending. But while oil stays elevated, Canadian data remain firm and global yields keep Yen under pressure, CAD/JPY has a stronger foundation than during June’s failed advance. This time, both sides of cross are helping.

Key Takeaways Brent’s break above $90 is strengthening CAD/JPY from both sides: improving Canada’s terms of trade while pushing global yields higher and pressuring the Yen’s carry-funding role. Unlike June’s Yen-only rally, Canada’s own data are now contributing, with a 75K jobs beat, firmer May GDP, and CPI reopening the BoC hike discussion. Global bond yields are rising with a stagflationary character, with the US 30-year at a 19-year high and German and Canadian yields at multi-year highs. Brent stabilizing around $90-91 is a falsifiable test: continued CAD/JPY strength without new oil highs would confirm the domestic Canadian story is real. 117.50 is the key resistance for a run toward 120 and then 120.86, but USD/JPY nearing the 159.6-160.6 intervention zone and the September 18 BoJ meeting remain the main risks to that path.

ActionForex

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

Silver (XAG/USD) extends its advance on Monday and trades around $66.30 at the time of writing, up 2.47% on the day. The white metal continues to rebound from the $63.50 area reached on Friday, mainly supported by the weakening US Dollar (USD) and fading expectations that the Federal Reserve (Fed) will raise interest rates again in September.

The shift in monetary policy expectations follows a series of disappointing US economic releases. US Retail Sales declined by 0.6% in July, while markets had expected a 0.1% increase, following a 0.2% rise in June.

These figures add to the annual slowdown in the Consumer Price Index (CPI) and Producer Price Index (PPI), as well as the weak July Nonfarm Payrolls (NFP) report. The accumulation of signs pointing to a slowdown in the US economy is reducing pressure on the Fed to raise interest rates further.

According to the CME FedWatch tool, markets now see around a 70% chance that the US central bank will leave interest rates unchanged at its September meeting, up from 48% a week earlier.

This repricing weighs on the US Dollar and provides support to Silver. The US Dollar Index (DXY), which measures the Greenback’s value against a basket of six major currencies, trades around 99.50 at the time of press after touching 99.30, its lowest level since June 5. A weaker US Dollar tends to make precious metals denominated in the US currency more attractive to investors using other currencies.

Investors remain attentive to geopolitical tensions in the Middle East, particularly around the Strait of Hormuz. Persistent risks to energy supplies are keeping Oil prices elevated and could fuel inflationary pressures, potentially limiting the Fed’s ability to adopt a more accommodative stance.

Market attention now turns to the Minutes of the July Federal Open Market Committee (FOMC) meeting, due on Wednesday. The document could provide further insight into the balance of risks within the Fed and determine whether the recent decline in rate hike expectations can persist, a factor likely to remain a key driver for Silver in the near term.

XAG/USD technical analysisIn the one-hour chart, XAG/USD trades at $66.36, retaining a bullish near-term bias as price holds well above the 100-period simple moving average (SMA) near $65.14 and the 200-period SMA around $64.04. The metal also respects an ascending trend-line support coming from $63.51 and now intersecting near $65.38, reinforcing the constructive structure, while the Relative Strength Index (RSI) around 65 suggests firm but not yet extreme upside momentum.

On the topside, the immediate hurdle is the horizontal resistance at $66.80, where buyers could face profit-taking. On the downside, initial protection is seen at the rising trend-line support near $65.38, followed by the 100-period SMA at $65.14; a deeper retreat would expose horizontal support at $64.25 ahead of the 200-period SMA at $64.04, where broader bulls would be expected to defend the uptrend.

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

Gold price (XAU/USD) gains momentum to around $4,395 during the early Asian trading hours on Monday. The precious metal extends the rally as cooling US inflation data has dampened expectations for the US Federal Reserve (Fed) interest rate hike. 

The US Census Bureau revealed on Friday that US Retail Sales declined by 0.6% MoM in July. This figure followed a rise of 0.2% in June and came in softer than the 0.1% expected. On an annual basis, Retail Sales increased 5.0% in July versus a rise of 6.8% (revised from 6.7%).

This report added to evidence that inflationary pressure is gradually easing after last week's Consumer Price Index (CPI) and Producer Price Index (PPI) data. This, in turn, weighs on the US Dollar (USD) and underpins the USD-denominated commodity price.  

Money markets have priced in nearly a 33.1% chance of a September Fed hike, according to the CME FedWatch tool. It’s worth noting that lower interest rates reduce the opportunity cost of holding non-yielding bullion, boosting its investment appeal. 

On the other hand, persistent tensions in the Middle East might cap the upside for the yellow metal. Iran’s Deputy Foreign Minister Kazem Gharibabadi called on the US to “accept the reality of defeat and stop indulging in delusions” after US President Donald Trump suggested that he would soon declare the Strait of Hormuz a “territory of the United States.” 

On Friday, Iran’s Foreign Minister Abbas Araghchi said that there were “no negotiations currently taking place between Tehran and Washington.” Araghchi added that the US must agree to Iran’s conditions in order for shipping to resume through the waterway.

Gold outlook stays constructive as Fed hike expectations fade and ETF demand returnsAnalysts at Commerzbank argue that the backdrop for bullion remains supportive, noting that, “as we expect the Fed not to raise interest rates, the gold price therefore still has further upside potential.” They caution that the path higher is unlikely to be smooth, pointing out that “the fact that this will not happen in a straight line is illustrated by the price fall since yesterday to USD 4,320 per troy ounce.” At the same time, Commerzbank highlights that “another positive factor for the price of gold is the renewed buying interest from ETF investors,” which they see as reinforcing the constructive medium-term outlook for the metal.

Technical Analysis: The positive tone of Gold remains intactIn the daily chart, XAU/USD holds just above the 100-day simple moving average (SMA) and comfortably over the 20-day Bollinger middle band near, keeping the near-term bias constructive while these layers of trend support remain intact. The Relative Strength Index (14) at 64.09 leans toward bullish but not yet overbought territory, suggesting buyers still have room to probe higher levels within the prevailing range.

On the topside, initial resistance is aligned with the upper Bollinger band at $4,480, where recent volatility extremes are likely to attract profit-taking. On the downside, the immediate floor is defined by the 100-day SMA at $4,385.85, with a deeper corrective cushion emerging around the Bollinger middle band at roughly $4,195; a break below that area would expose the lower band support near $3,905.

(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.

RBC's price assumptions put gold at an average $5,250 an ounce in 2027 and $5,500 in 2028, while JPMorgan sees evidence that buyers are returning after the market established support near $4,000.
The Gold price in US Dollars has begun to recover from its mid-year correction, and two bank research frameworks point to a market that is consolidating rather than ending its longer-term advance.

Latest gold market data: XAU/USD traded at $4,351.05 an ounce at 11:56 BST on 14 August 2026, down 0.17% on the day but 7.34% higher over one month.

Gold remained 6.43% lower over three months and 13.48% lower over six months, yet it was still 30.65% above its level a year earlier.

Gold price performance over one month to 14 August 2026.

RBC's Gold Standard comparable tables assume an average $4,732 for 2026, rising to $5,250 in 2027 and $5,500 in 2028.

The bank's long-term assumption is lower at $4,000, giving the forecast a pronounced medium-term peak rather than an indefinitely rising line.

From current spot, the 2027 average is roughly 21% higher and the 2028 assumption about 26% higher.

These are annual averages used in company valuation work, not year-end targets, so gold would not need to finish either year at precisely those levels.

JPMorgan sees buyers returning above $4,000
JPMorgan's volatility research supplies the market mechanism behind the upside case.

“The fundamental view remains on the upside in the long term, as we continue to see strong inflows from central banks with accelerated buying on the dip,” the bank said.

That official-sector thesis has support beyond the research note: World Gold Council data show reported central-bank reserves rising by a net 41 tonnes in May.

JPMorgan also sees a change in investor behaviour after July's narrow trading range.

“As gold prices are finding the floor at 4000 and trading within a tight 5% range over the whole of July, the first signs of buyers winning over sellers are starting to show,” it said.

Retail demand is part of that turn.

“We are starting to see retail investors warming up to gold again,” JPMorgan said, pointing to renewed call-option interest in the GLD exchange-traded fund.

Gold price performance in 2026 to 14 August.

The two banks are not making identical calls.

RBC supplies a multi-year price deck, while JPMorgan identifies positioning and volatility signals around a $4,000 support area.

Together they describe a bullish medium-term case with real drawdown risk: the long-run floor is well below RBC's projected 2028 peak, but central-bank buying and returning investor demand can keep the recovery alive before that normalisation arrives.

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

Gold price (XAU/USD) registers gains of over 1% on Wednesday as US inflation data aligns with estimates, easing the Federal Reserve’s (Fed) task of further tightening monetary policy. The Consumer Price Index (CPI) continues its downward trajectory. The XAU/USD trades above $4,400 after bouncing off daily lows of $4,362.

XAU/USD rallies after US inflation cools, easing September hike fearsBullion extended its gains as investors speculate that the Fed will not raise rates at its September meeting, following July’s report. On Tuesday, money markets priced in a 52% chance of a Fed rate hike at the next meeting. But the dip in inflation shifted the odds to 60% that the US central bank will keep rates steady, according to Prime Terminal data.

The Fed has a 73% chance of raising rates in December, with three inflation reports before the December 9 meeting.

July’s CPI came in at 3.5% YoY, down from 3.6%, while core CPI also edged lower from 2.6% to 2.5% YoY, as revealed by the US Bureau of Labour Statistics (BLS). Even though Oil prices rose nearly 24% in July, gasoline prices declined for the second straight month.

However, geopolitics continued to weigh on the economy, and if negotiations between the US and Iran failed to reach common ground to end the conflict, energy prices could jump again, threatening to halt the disinflation process in the US.

According to Al-Mayadeen, an Iranian political and security source said that the Strait of Hormuz remained closed and that Tehran hasn’t changed its policy.

US President Donald Trump posted on his Truth Social account that “The U.S.A. has total control over the Strait of Hormuz. I THINK WE WILL KEEP IT!” It's a belief that isn't backed up by the facts on the waterway. At the same time, CNN reported that US embassies in the Middle East would continue to work with reduced staff amid the Iran war.

On Thursday, traders' eyes will be on the release of the US Producer Price Index (PPI) for July and Initial Jobless Claims data. If the number of Americans filing for unemployment benefits rises, it could increase downside risks to the labour market, which could push the Unemployment Rate higher.

XAU/USD price forecast: Gold climbs back above $4,400, eyes on $4,500Gold price seems to be gaining traction as it clears the 100-day Simple Moving Average (SMA) at $4,388, potentially opening the door to further upside. Momentum as measured by the Relative Strength Index (RSI) shows that buyers are gaining traction. Hence, the path of least resistance is upward in the short term.

XAU/USD's first resistance would be the $4,450 psychological level. A breach of it will expose the 200-day SMA exactly at the psychological $4,500 mark. A daily close above the latter could pave the way to challenge the $5,000 milestone.

On the flip side, if Gold falls below the low of the day (LOD) at $4,362, it opens the door to a deeper pullback. The next support is $4,300, followed by the July 6 high at $4,202. If this level fails, the next support levels are the 50-day SMA at $4,150 and $4,100.

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.

Silver price (XAG/USD) trades 1.1% higher at around $65.40 during the Asian trading session on Wednesday. The white metal reflects strength ahead of the United States (US) Consumer Price Index (CPI) data for July, which will be published at 12:30 GMT.

According to estimates, the US headline CPI grew at an annual pace of 3.4%, slower than 3.5% in June. In the same period, the core CPI – which excludes volatile food and energy items – is also seen lower at 2.5% Year-on-Year (YoY) from the previous reading of 2.6%.

On a monthly basis, the headline and core inflation grew by 0.1% and 0.2%, respectively.

Investors will pay close attention to the US inflation data to get fresh cues regarding the Federal Reserve’s (Fed) monetary policy outlook. In the latest monetary policy announcement, Chairman Kevin Warsh warned of upside inflation risks, adding that the board is committed to bringing inflation down to the 2% target.

Meanwhile, surging oil prices due to restricted global energy supply on the back of Middle East conflicts will likely limit the Silver price’s upside.

According to data from Kpler, shipping traffic through the Strait of Hormuz, a vital passage to almost 20% of global energy supply, was recorded at just six vessels on August 10, down from a recent 10-day average of about 11. This remains a massive decline from pre-war levels of 130 to 140 ships daily, Reuters reports.

On Tuesday, the CME Group said that it will allow round-the-clock trading in its 100-ounce silver futures contract from September after seeing a strong response for the 1-ounce Gold futures contract, which began on July 24, Reuters reports.

Silver Technical Analysis

In the daily chart, XAG/USD trades at $65.53, extending its advance above the 20-day exponential moving average (EMA) at $61.28 and reinforcing a bullish near-term bias.

Price action has steadily pushed away from the prior consolidation zone, while the Relative Strength Index (14) at 61.21 stays in positive territory but short of overbought, hinting that upside momentum remains constructive without being overstretched.

On the downside, immediate support is seen at the 20-day EMA around $61.28, which underpins the broader rebound and would be the first line of defense on any pullback. Looking up, the white metal would attempt to extend the advance towards the June 17 high at $71.56 if it manages to break above the August 10 high at $66.59.

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

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.

Gold rose to 4,400 USD per ounce on Tuesday, reaching a two-month high. Demand for the precious metal is growing rapidly, even amid heightened inflation risks and expectations of higher interest rates driven by elevated oil prices.

Chinese institutional investors continue to build positions in gold as a defensive asset amid heightened volatility in other markets. China’s gold-backed ETFs are recording their longest run of inflows in months.

The People’s Bank of China is also supporting the market. In July, the regulator increased its gold reserves by approximately 20 tonnes, following an increase of around 15 tonnes in June – the largest monthly addition since October 2023.

At the same time, uncertainty persists around a potential US–Iran agreement that could end the conflict and reopen the Strait of Hormuz. Investors are also awaiting key US inflation data this week, which could shift expectations for future Federal Reserve policy.

Technical analysis

On the H4 XAU/USD chart, the market formed a consolidation range around the 4,341 USD level and, following an upside breakout, moved higher to 4,435 USD. A consolidation range is now forming below this level. A move lower towards 4,370 USD is expected next, with a possible extension to 4,340 USD. A further rise towards 4,575 USD is anticipated as the local upside target. The MACD indicator signals the early stages of bearish momentum, with its signal line above the centre line at recent highs and beginning to turn downwards.

On the H1 chart, the market broke above the 4,371 USD level and moved higher to 4,435 USD, followed by a correction to test 4,371 USD from above. A broad consolidation range is forming around 4,371 USD. A move higher towards 4,460 USD is expected, followed by a decline to 4,371 USD. The Stochastic oscillator confirms this scenario, with its signal line below 50 and pointing downwards towards 20, indicating increasing short-term downside pressure.

ConclusionGold has rallied to a two-month high, driven by robust demand from Chinese institutional investors and the People’s Bank of China’s continued reserve accumulation. Despite rising inflation risks and expectations of higher interest rates, the metal’s appeal as a defensive asset has strengthened amid market volatility. Uncertainty over a potential US–Iran agreement and the outlook for the Strait of Hormuz, along with upcoming US inflation data, continues to keep markets on edge. Technically, gold may see a short-term pullback towards 4,340–4,370 USD before potentially resuming its uptrend towards 4,575 USD. The metal’s near-term direction will depend on geopolitical developments and US monetary policy expectations.

Friday’s US employment report was the first of four major pieces of economic data due before the Federal Reserve’s September meeting. The figures delivered a significant downside surprise, prompting markets to scale back expectations of a September rate hike to around 44%, from above 55% ahead of the release. Yet, the data hasn’t materially changed the USD/JPY forecast much. The pair has already recovered towards the levels seen before the payrolls release, trading close to 159.00. That leaves the pair once again within striking distance of the psychologically important 160.00 level. Unless upcoming US data deliver further negative surprises, or Japanese authorities step back into the market, USD/JPY could once again test that threshold.

The next major catalyst is US inflation, with CPI due later this week. At the same time, developments in oil markets remain important, particularly as uncertainty surrounding the Strait of Hormuz continues to complicate the inflation outlook.

Oil remains a key variable for the dollar outlook Crude oil prices continue to find support from the uncertainty surrounding shipping through the Strait of Hormuz. Although Donald Trump has indicated that Washington is “semi-negotiating” with Iran, the language suggests that economic pressure remains central to the strategy rather than an immediate move towards military escalation.

There have also been reports that Iran and Oman are edging towards an understanding over a shipping route through the Strait. However, any meaningful and sustained reopening of the waterway is likely to depend on wider progress in US-Iran negotiations.

A prolonged disruption to energy flows should keep inflationary pressures elevated. That could make it harder for the Fed to ease policy, even if we see further data weakness, potentially providing an underlying source of support for the greenback.

The Fed’s data-dependent approach puts CPI in the spotlight The latest market reaction reinforces just how important incoming economic data have become for the dollar. Rather than relying heavily on oil prices alone, markets are increasingly being forced to assess individual data release through the Fed’s evolving reaction function.

That shift follows Federal Reserve Chair Kevin Warsh’s decision to move away from providing firm forward guidance. His recent messaging has left greater room for incoming data to reshape expectations around monetary policy.

There are still several important data points to come before the September 16 FOMC meeting: another payrolls report and two further CPI releases, including this week’s figures.

Inflation is particularly important because of Warsh’s admission that the Fed has consistently gotten it wrong and is looking to address it. As a result, any surprises in CPI or other inflation data like PPI could generate much larger moves in the dollar than we have seen from Friday’s jobs report alone.

This also helps explain why the weak payrolls figures did not trigger a sustained collapse in USD/JPY. Markets still have several opportunities to reassess the Fed outlook before September.

What is expected from CPI data? US CPI is now arguably the most important event on this week’s calendar. The previous CPI report had certainly surprised to the downside. Headline inflation slowed more sharply than expected to 3.5% from 4.2%, while core CPI eased to 2.6%. This time, economists expect moderate weakness. Headline CPI is expected to rise 0.1% month-on-month, taking the annual rate to 3.4%. Core CPI is forecast to increase 0.2% on the month, leaving annual core inflation at 2.5%.

The question now is whether we will see that moderation, and if so, whether it is enough to trigger further dovish repricing in US dollar. But as mentioned, alongside data it is also the developments in oil prices which will determine whether expectations for a tighter Fed are rebuilt or continue to unwind.

Why the yen is struggling to capitalise on softer US data In theory, the yen should be among the clearest beneficiaries of weaker US economic data because USD/JPY remains highly sensitive to the interest-rate differential between the two economies.

Yet the yen continues to face selling pressure, even following intervention episodes. The USD/JPY sold of sharply in late July as both the US and Japanese authorities jointly intervened in the foreign exchange market to support the yen. Such coordinated action is unusual and suggests that the US Treasury may be taking a more active role in attempts to stabilise the currency.

However, intervention alone is unlikely to deliver a durable change in the direction of USD/JPY. Foreign exchange intervention can disrupt positioning, reduce excessive volatility and alter market psychology. What it generally cannot do is permanently overturn a powerful macroeconomic trend.

Even growing expectations of a September Bank of Japan rate increase have so far struggled to generate a sustained reversal in the pair.

This is partly because the interest-rate gap with the US remains wide enough to keep carry-trade demand for the dollar alive.

Softer US data may improve the fundamental case for a stronger yen, but positioning and yield differentials can continue to work in the opposite direction – especially if oil prices remain elevated for longer.

USD/JPY forecast: 160 remains firmly on the radar Technically and fundamentally, USD/JPY remains caught between competing forces. The pair has already recovered to above 158.50, effectively returning to the area where it traded before Friday’s payrolls shock.

That recovery suggests the market has not yet fully embraced a sustained dovish repricing of the Federal Reserve. With the USD/JPY now also back above the 200-day average, the near-term path of least resistance is no longer to the downside.

Source: TradingView.com The path ahead is therefore likely to remain volatile. A return towards 160.00 remains a realistic possibility, particularly if US inflation proves sticky or oil prices remain elevated. 160.50 is the next obvious resistance followed by 162.00.

Meanwhile, if support around 158.00 area gives way and price moves below the 200-day again, then in the case, a return to 157.00 and possibly 156.00 will become likely. For that to happen, you’d feel US CPI will have to be quite weak this week. 

-- Written by Fawad Razaqzada, Market Analyst

Follow Fawad on Twitter @Trader_F_R

Gold resumes advance on Friday after bulls paused previous day and hit new seven- high ($4371), on track for the biggest weekly gain since the third week of January.

Disappointing US July labor data on Friday contributed to fading expectations for Fed rate hike in September that further boosted demand for the yellow metal, although, markets await release of US inflation report for July (due next week) to get more details about the monetary policy near-term outlook.

Fresh gains broke through important barrier at $4304 (Fibo 38.2% of $4889/$3942 descend) with weekly close above this level to confirm bullish signal and further strengthen near-term structure.

Bulls cracked next barrier at $4358 (daily Ichimoku cloud top) although may take a breather here, due to stretched daily studies and partial profit-taking at the end of the week, before resuming towards targets at target at $4390 (100DMA); $4400 (round-figure) and $4416 (50% retracement).

Dips should be limited and ideally contained by broken Fibo 38.2% barrier, to keep bulls intact.

Res: 4358; 4371; 4390; 4416
Sup: 4304; 4230; 4204; 4175

Windsor Brokers Ltdhttp://www.windsorbrokers.com/

The information contained in this document was obtained from sources believed to be reliable, but its accuracy or completeness cannot be guaranteed. Any opinions expressed herein are in good faith, but are subject to change without notice. No liability accepted whatsoever for any direct or consequential loss arising from the use of this document.

Gold (XAU/USD) resumes its bullish trend on Friday, after a brief consolidation on Thursday, to reach fresh three-week highs above $4,300, with bulls aiming for mid-June highs in the $4,380 area. The precious metal is on track for its strongest weekly performance since January, with a nearly 7% gain, although further appreciation is likely to depend on the outcome of July’s Nonfarm Payrolls (NFP) due later in the day.

The market consensus forecasts a net increase of 80K payrolls, from 57K in June, although analysts from some of the world’s major commercial banks are keeping a cautious view.

Deutsche Bank experts are anticipating a more modest improvement in today’s labour market report, with a “slight uptick in headline (+65k forecast vs. +57k previously). They note that such an outcome “would put the latest readings below the 3- and 6-month moving averages, consistent with the recent slowing in the weekly ADP reports,” underscoring a gradual cooling in hiring momentum rather than a sharp deterioration.

Technical Analysis: Gold confirms a trend shift

XAU/USD trades at $4,315.19, keeping a constructive near‑term bias after breaking the downward trendline resistance from April highs earlier this week. Relative Strength Index (RSI) studies highlight overstretched levels on intraday charts, although the daily chart shows room for further appreciation, at 67. The daily Moving Average Convergence Divergence (MACD) keeps trending higher, reinforcing the bullish view.

Above $4,300, the next hurdle lies at the June 15 and 17 highs in the mentioned $4,380 area. Further up, the late-May lows just ahead of $4,600 will come into focus. Supports are at Thursday's low of $4,223, ahead of the broken trendline, now around $4,050, and the July 31 and August 3 lows, around the $4,000 level.

(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.

Gold flows into ETFs flipped positive globally in July. After two consecutive months of outflows, every region reported positive flows of metal into gold-backed funds in July.

With Europe leading the way, gold ETFs reported net gold inflows of 23.5 tonnes in July, valued at $3 billion.

Assets under management (AUM) by gold-backed funds rose 1 percent to $530 billion. ETFs currently hold 4,068 tonnes of the yellow metal.

Year-to-date, ETFs have added a net 39 tonnes of gold to their collective holdings valued at $11 billion.

The World Gold Council pinpointed three factors driving the ETF turnaround in July:

Diversification amid tech volatilitySelective bargain hunting as prices fellPolicy and geopolitical uncertainty, particularly an unclear monetary policy outlook and the ongoing war in IranEuropean ETFs reported the second-strongest month of inflows this year in July, adding 17.3 tonnes of gold valued at around $2 billion.

Funds based in the UK and Switzerland led the surge.

According to the World Gold Council, it appears investors in Europe “rebuilt their positions” following a big selloff in June, as lower prices created buying opportunities.

“This mirrors the pattern seen earlier in the year, when European funds led the rebound following March's sharp U.S.-led outflows, suggesting investors were willing to add exposure after periods of market weakness.”

Asian funds reported a 4.8-tonne increase in gold holdings valued at $116 million. Chinese funds led the way with investors seeking a safe haven.

The CSI 300 Stock Index recorded its worst month since January 2016. Meanwhile, falling local yields reduced the opportunity cost of holding gold.

Japanese-listed funds reported outflows as rising local yields diverted investor demand.

Indian funds reported modest inflows of $157 million.

North American funds reported inflows of just 0.3 tonnes valued at $71 million. The World Gold Council called it a “tentative recovery” after two months of significant outflows.

North America remains the only region reporting net gold outflows for the year.

Funds in other regions, including Africa and Australia, reported gold inflows of 1 tonne valued at $140 million. ETFs listed in South Africa and Australia led the way.

ETFs are a convenient way for investors to play the gold market, but owning ETF shares is not the same as holding physical gold.

ETFs are relatively liquid. You can buy or sell an ETF with a couple of mouse clicks. You don’t have to worry about transporting or storing metal. In a nutshell, it allows investors to play the gold market without buying full ounces of metal at the spot price. 

Since you are just buying a number in a computer, you can easily trade your ETF shares for another stock or cash whenever you want, even multiple times on the same day. Many speculative investors take advantage of this liquidity.

But while a gold ETF is a convenient way to play gold's price, you don’t possess any gold. You have paper. And you don’t know for sure that the fund has all the gold either, especially when it sees inflows. In such a scenario, there have been difficulties or delays in obtaining physical metal.

Trading volumesGlobal market liquidity averaged $356 billion per day in July, down 3.5 percent month-on-month.

Over-the-counter trading volumes also fell, ticking lower by about 3.4 percent to $205 billion per day.

Despite the decline, both LBMA volumes and Shanghai trading activity remained above their 2025 averages.

Total COMEX longs dropped modestly by 4.4 percent to 542 tonnes.

Managed money appears to be rebuilding its position, with longs adding 11 tonnes.

The World Gold Council described the current position as “near neutral.”

“Gold continues to be weighed down by the effects of the war in the Middle East, which has reinforced inflation risks and supported the dollar and yields, adding to the opportunity-cost headwind facing gold.”

To receive free commentary and analysis on the gold and silver markets, click here to be added to the Money Metals news service.

OCBC’s Christopher Wong and Sim Moh Siong highlight a sharp rebound in Gold as easing Middle East tensions weighed on Oil and US Treasury yields, softening the US Dollar. Technical buying and short covering accelerated once resistance broke, while central bank demand from the Bank of Korea added support. Near-term momentum is mildly bullish, with key resistance at 4333 and 4393 and support at 4160 and 4077.

Gold breakout on softer yields"Gold rose sharply overnight as easing Middle East tensions drove oil prices lower while US Treasury yields and USD eased. Market expectations for Fed to hike in Sep has eased. About 55% probability priced (vs. 66% a week ago). The sharp move in gold accelerated after prices cleared recent resistance, triggering technical buying and short covering."

"Gold’s strength suggests investors are increasingly pricing a de-escalation of the US-Iran conflict, a normalisation of oil flows through the Strait of Hormuz, lower real interest rates and a softer USD."

"News that the Bank of Korea is preparing to purchase domestically produced gold for the first time in 13 years and that they had recently begun buying gold ETF may also have provided a modest sentiment boost, although the scale and timing of its purchases remain unclear."

"Near-term momentum has improved, with Friday’s upcoming US payrolls report now key to whether the decline in yields, USD and gold’s breakout can be sustained."

"Daily momentum is mild bullish while RSI rose to near overbought conditions. Resistance at 4333 (23.6% fibo retracement of 2026 high to low), 4393 (100 DMA). Support at 4160 (50 DMA), 4077 (21 DMA)."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)