Recent US job reports show a significant drop in job growth. Revisions indicate there were 260,000 fewer jobs in May and June than initially thought. Additionally, the unemployment rate unexpectedly rose, leading to doubts about a possible interest rate cut in September. As a result of these changes, the US dollar’s gains against the euro have faded, reflecting a shift in market sentiment. Also, President Trump’s abrupt firing of the head of the Bureau of Labor Statistics has raised worries about the reliability of upcoming reports. Fed Governor Adriana Kugler’s early resignation could impact who leads the Federal Reserve. It’s uncertain how this will affect the US dollar, as the next nominee may align with Trump’s views. In the markets, both EUR/USD and GBP/USD are showing changes due to recent US data and global feelings. Gold prices are stabilizing, while Bitcoin is recovering, despite a backdrop of uncertainty. The Euro area economy remains strong, helped by recent EU-US agreements and increased spending in Germany. However, risks still linger. Cryptocurrency and Forex markets are adapting to these shifting financial situations. The latest jobs report revealed a revision of 260,000 fewer jobs and an unexpected rise in the unemployment rate to 4.2%. This has shifted our perspective. Now, there’s an over 80% chance that the Federal Reserve will cut interest rates in September—an indication that economic weakness is a significant concern. With President Trump’s dismissal of the BLS head, we must view future data with caution. This uncertainty, along with Governor Kugler’s resignation, raises political risks for US assets. The CBOE Volatility Index (VIX) has spiked above 20, a level we haven’t seen since earlier this year. In currency markets, we anticipate that the US dollar will likely decline. The EUR/USD has clearly surpassed the 1.1000 level, supporting our belief, especially as the Euro area economy shows more stability due to recent EU-US trade deals. We plan to sell dollars if there is any short-term strength. The increase in volatility suggests that using options could help us manage risk in the weeks ahead. Buying protective puts on major US indices like the S&P 500 can safeguard against further declines tied to economic fears. This strategy allows us to protect our investments while remaining open to potential market recoveries. We are also considering assets that may thrive with a weaker dollar and falling rates. Gold has formed a solid support level around $2,350 per ounce and appears attractive during any price dips. Bitcoin’s strong bounce back to over $80,000 indicates that it is being viewed as a safeguard against fiat currency uncertainty, similar to its behavior during the inflationary period in 2022.

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