Understanding Today's News

Market Overview

This week, major market data is set to be released, with the focus on the Federal Reserve's (FED) rate cut decision on Thursday. Traders are split on the size of the cut; a 50-bps cut could signal a looming recession, while a larger cut might promote long-term growth and boost demand for the U.S. dollar.

The Bank of England (BOE) is expected to maintain its rates, though faster cuts are anticipated soon, potentially weakening the pound in late October. Canada's CPI report is also awaited, as recent discussions of rate cuts from the Bank of Canada (BOC) could weaken the Loonie.

Meanwhile, Japan is expected to continue raising rates, provided inflation meets forecasts, while Australia and New Zealand will release economic data later in the week to guide their markets.

MARKET ANALYSIS

GOLD - GOLD has surged to new highs, setting a record even before the rate cuts are announced. Traders are now pricing in the possibility of a dollar recovery or a correction before a continuation upward. However, with prices remaining high, further growth is expected in the market. Prices have already surpassed normal levels.

SILVER - SILVER has risen above 30.668, and we see it continuing to climb. A correction would provide a better entry price, but if markets stay elevated, SILVER could rise further, especially with the upcoming rate cuts. We may also see consolidation and profit-taking, followed by a potential drop before a resurgence in buying volume.

DXY - The dollar has reached a bottom, with signs of a potential break to the downside. However, there may be a slight recovery as the market fills the recent gap before continuing its trend. This could last until the rate cut. With traders still divided on the size of the cut, market expectations remain mixed.

GBPUSD - The pound has gained strength after last week’s trading, showing growth as it consolidates between 1.31804 and 1.31097. While we anticipate further upward movement, the possibility of a drop remains, as the current rise appears corrective in nature. We will continue to monitor the market closely.

AUDUSD - The Aussie dollar remains bearish, with 0.67142 acting as resistance. We expect more selling based on current structure analysis but also foresee possible consolidation at this level, preparing for a sudden rise. A few more days will pass before the rate cut announcements.

NZDUSD - Selling has already affected the Kiwi, as prices failed to reach 0.62086. We expect the price to move toward 0.61408.

EURUSD - Euro strength emerged last week, with prices consolidating between 1.11386 and 1.10090. The bottom structure has rejected market selling, but with signs of a potential dollar recovery before the rate cut, we may see selling pressure push the Euro lower. However, until we see clear evidence of a market break to the downside, we remain bullish on the technical outlook.

USDJPY - Yen strength continues, creating a new low beyond the previous quarter’s low, reflecting market confidence in upcoming rate hikes. Although hikes are not expected in September, they are anticipated before the year ends. FED rate cut expectations further support market selling.

USDCHF - The Franc market remains consolidated, with prices between 0.85541 and 0.84086. We await further evidence to support market expectations. Recent reports of a possible surprise rate cut for the Franc are circulating. Until then, we expect the market to remain stagnant or influenced by USD expectations.

The Swiss franc’s rally to its strongest level in nearly a decade has raised the prospect of the first significant interest rate cut by a major central bank this year. While economists predict a quarter-point cut at the Swiss National Bank’s next meeting on Sept. 26, the probability of a half-point reduction has steadily risen, now standing at about one-in-three, up from zero just a month ago.

USDCAD - The Canadian dollar remains consolidated, awaiting more evidence of a rate cut and potential market weakness. This is evident in the still weak price action, as it has failed to reach 1.36328 despite last week’s weak dollar performance.