Retail sales in the Netherlands increased by 4.5% in December compared to last year, up from 3.9% previously. This growth is occurring alongside broader trends in global finance. The USD/CHF is holding steady near 0.7730 as we await the US ISM PMI data release. On the other hand, the USD/JPY has dropped below 155.00, forming a descending channel pattern.

Currency Pairs Under Pressure

Both EUR/USD and GBP/USD are feeling the pressure from a strong US Dollar. Kevin Warsh’s nomination as Fed Chair is influencing the markets, strengthening the Dollar against other currencies. Gold prices have fallen to monthly lows of $4,400 due to profit-taking and the strength of the US Dollar. Bitcoin has dropped below $75,000, marking an 11% decline in the past week, with expectations pointing toward a further decrease to $70,000. The markets are experiencing volatility due to the “Warsh effect” following the nomination, which is affecting central banks this week. Brokers in 2026 offer various advantages, emphasizing low spreads and leverage, appealing to different traders. FXStreet notes that market profiles provide useful information but are not trading instructions. They recommend making informed decisions and accepting responsibility for trading risks and costs.

Focus on US Economic Indicators

Kevin Warsh’s nomination as the next Fed Chair is strengthening the US Dollar, a trend that is likely to continue. This could be a good time to buy call options on the Dollar index or put options on EUR/USD, allowing traders to take advantage of expected volatility while managing risk as the market adjusts to potential higher interest rates. Attention is now on the upcoming US ISM Manufacturing PMI data. If the reading exceeds the important 50.0 mark, it would indicate economic growth and could further boost the Dollar. Looking back from 2025, we saw the Federal Reserve take strong action to control inflation in the early 2020s. The market now anticipates a similarly active approach from a Warsh-led Fed, raising interest rate expectations, similar to the tightening cycle in 2022. The recent decline in gold prices is a direct consequence of this shift, with gold testing the $4,400 level after a significant rise. Historically, gold prices have an inverse relationship with real yields, which are now increasing due to expectations of a more aggressive Fed. Traders might consider buying put options on gold to prepare for additional price drops, particularly if the Dollar’s strength persists. Bitcoin’s drop below $75,000 indicates a broader market shift rather than a mere currency adjustment. The market is clearly bearish, and using futures to short Bitcoin toward the next major support level around $70,000 fits with this trend. This sentiment is also impacting equity indices, which tend to struggle when unexpected monetary policy tightening is anticipated. Create your live VT Markets account and start trading now.

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