The US Dollar (USD) is trading unevenly against major currencies, as risk appetite diminishes. Tariff concerns have led to declines in bond yields, with 10-year US Treasury yields falling by 6 basis points.

Global stock performance remains mixed, with the DXY potentially rising slightly in the short term. Current market conditions resemble those following Trump’s first term election, influencing expectations for the USD.

The USD appears overvalued in relation to existing tariffs, mainly those on China. Upcoming US data releases include housing figures, Consumer Confidence, and the Richmond Fed’s Manufacturing Index.

The greenback’s movements remain erratic, swayed by uncertainty around trade policies. Many traders are watching bond markets, where the yields on 10-year Treasuries have dropped by 6 basis points. A yield decline often signals growing caution, as funds shift towards safer assets. Sentiment in equities is mixed as well, making short-term predictions more challenging.

Although strength in the dollar index (DXY) is possible in the immediate future, conditions are reminiscent of the period following the previous Republican administration’s first election victory. Back then, early optimism gave way to shifts in trade dynamics and monetary expectations, much like what seems to be happening now. If history is any indication, this could mean some temporary resilience in the dollar followed by gradual recalibration.

Right now, the dollar is trading at levels that seem high relative to the existing tariffs, especially those on Chinese goods. This is causing some traders to question whether recent moves in the currency align with underlying trade policies. Adjustments could follow if market participants reassess the broader economic impact.

Several upcoming data releases may drive changes in positioning. Housing figures will give a sense of whether the property sector is holding up under current interest rate conditions. Consumer Confidence numbers will shed light on the public’s economic outlook, which could feed into spending behaviour. Meanwhile, the Richmond Fed’s Manufacturing Index offers a temperature check on regional industrial activity—key for gauging business sentiment and production trends.

If the numbers indicate unexpected weakness, rate expectations could adjust once more, affecting yields and, by extension, the greenback. Those trading derivatives will need to be mindful of how these factors feed into broader market flows. With volatility present, there is potential for sudden shifts, and close monitoring of economic indicators will be required in the weeks ahead.

The US stock market reflects varied performance across sectors today. The technology sector is experiencing declines, with Microsoft down by 0.65% and Oracle decreasing by 0.53%.

Semiconductors are also under pressure; AVGO has fallen by 1.64%, while NVIDIA is down by 0.41%. In contrast, the healthcare sector is performing well, with Eli Lilly rising by 0.93%.

Financial stocks are gaining, with Berkshire Hathaway increasing by 1.15% and JPMorgan and Visa up by 0.52% and 0.50%, respectively. Utilities show a similar trend, highlighted by AT&T’s rise of 1.35%.

The consumer defensive sector experiences gains, with Walmart increasing by 0.80%. Conversely, consumer cyclical stocks like Amazon and Tesla have declined by 0.58% and 1.56%.

Investors may look to increase exposure in healthcare and financial stocks, given their current positive momentum. Staying cautious with technology investments, particularly semiconductors, is advisable.

A focus on resilient sectors such as utilities and healthcare is recommended. Continuous monitoring of market changes will assist in navigating potential fluctuations effectively.

Today’s market action shows a broad split across industries. Technology stocks are struggling, with names like Microsoft and Oracle seeing losses. Chipmakers are also having a rough session—Broadcom has dropped more than 1.5%, while NVIDIA is also in the red. On the other hand, healthcare is moving in the opposite direction, with Eli Lilly showing solid gains.

Financial stocks are also performing well. Warren’s company has added over 1%, while JPMorgan and Visa are both posting smaller but steady gains. Utilities are moving in the same direction, with AT&T standing out. Supermarkets and similar defensive stocks are also seeing strength, demonstrated by Walmart’s increase. However, consumer cyclical stocks, including Amazon and Tesla, are heading lower.

With healthcare and banks gaining momentum, those industries could continue to provide stability. While technology stocks often influence broader sentiment, semiconductors are under clear selling pressure. Though it may be tempting to treat the pullback as a buying opportunity, further weakness in that space would not be surprising.

Resilient industries, such as healthcare and utilities, are currently attracting more interest. A move away from risk-sensitive stocks towards safer choices is unfolding, which cannot be ignored. Keeping an eye on how these trends develop will be important, particularly with weaknesses in growth-related sectors.

Gold reached a record price of $2,956 on Monday, before stabilising around $2,940 on Tuesday following the Trump administration’s announcement of additional tariffs. This includes tougher restrictions on China’s technology and semiconductor industry.

Market reactions have been negative, prompting traders to seek refuge in bonds, which has led to decreased yields. Equities have suffered as a result, with declines marked across multiple regions, including US futures, while attention turns to the upcoming Personal Consumption Expenditures report.

The Federal Reserve’s interest rate cut expectations are now at 50.0% for June, increasing due to lower US yields, while the likelihood of pausing rates has fallen to 32.6%. Economic indicators and Fed speeches are anticipated, dealing with inflation and financial stability.

Gold is facing selling pressure, with S1 support currently holding at $2,930. Notably, the previously set all-time high remains pivotal, with resistance identified at $2,964 and $2,977.

Tariffs aim to boost local producers but also risk escalating trade wars, creating mixed views among economists. Trump’s intentions focus on leveraging tariffs to strengthen the US economy leading up to the 2024 elections.

Overall, Gold’s trajectory is influenced by tariffs and broader economic signals, as traders monitor developments closely.

Gold surged to an all-time high before settling slightly lower, following fresh trade measures targeting China. These steps, aimed primarily at tightening restrictions on high-tech sectors, have led to a swift response from markets. Bond yields have dropped as investors seek safety, while stock markets have stumbled, with futures pointing downward.

The focus now shifts to inflation data, particularly the Personal Consumption Expenditures report, which will provide insight into spending patterns and potential shifts in Federal Reserve policy. Expectations for a rate cut in June have climbed, largely driven by falling US yields, while the probability of keeping rates unchanged has slipped. Upcoming speeches from central bank officials will be closely analysed, particularly for their views on inflation trends and broader financial risks.

Gold, which saw strong upward momentum, is now under some selling pressure. Current price levels suggest buyers remain active around $2,930, a level which has provided support. On the upside, previous highs near $2,964 and $2,977 act as barriers that participants will be watching. If prices lose traction below support, further downward moves could follow.

The latest measures on trade have stirred debate. Some argue they support local industries, though others warn of escalating tensions with China. As election season approaches, there seems to be a clear attempt to use trade policies to reinforce economic positioning. The effects of these actions will take time to unfold, but traders must now weigh the impact on broader markets.

With all this in motion, traders are paying close attention to policy developments and fundamental indicators. Price action in gold and other assets will likely be shaped by shifting expectations, with movements in interest rates and trade policy playing a central role.

The USDCHF has reached new lows, marking the lowest level since December 2023. This downward movement has intensified the bearish trend observed in the market.

As the price declines, it is nearing an important technical level that traders watch closely. Currently, sellers dominate, yet the 100-day moving average at 0.9000, along with the swing area from 0.8914 to 0.8923, serves as a significant target for market participants.

With the USDCHF continuing to weaken, many within the market are now focusing on whether the downward pressure will persist or if conditions might favour a recovery. The current trajectory suggests that momentum remains with those who have been selling, yet the 100-day moving average near 0.9000 and the nearby swing area between 0.8914 and 0.8923 are key reference points where activity is expected to gather pace.

A move towards these levels could prompt a reaction, especially given the way price has behaved near similar technical markers in the past. If the pair reaches this zone and holds, those looking for signs of exhaustion in the decline may begin to step in. However, a decisive break lower would reinforce the broader selling pattern that has been in place for some time. Market participants should be prepared for short-lived rebounds, as temporary recoveries can occur even in trending conditions.

Looking beyond technical considerations, the role of external forces cannot be ignored. Recent economic releases and policy decisions have played a role in shaping sentiment, with traders keeping a close eye on how central banks position themselves in response to inflation and growth data. The shifting stance on interest rates, in particular, remains a focal point, as differences in monetary policy expectations between jurisdictions can influence direction.

Developments in risk sentiment are another factor that has guided flows in recent sessions. Safe-haven demand has been inconsistent, with investors weighing global uncertainties against shifting expectations around policy moves. When confidence in broader markets wavers, adjustments in positioning tend to follow, adding an additional variable to consider when assessing short-term price movements.

From a practical standpoint, staying adaptable remains essential as the market continues to react to changing inputs. Price movements are often driven by a combination of technical and economic influences, and keeping track of both allows for a more balanced perspective. As the days ahead unfold, watching how price interacts with established support zones and whether any fresh catalysts emerge will be key in determining what happens next.

Brazil’s mid-month inflation increased from 0.11% to 1.23% in February. This change indicates a rise in the cost of living within the country during this period.

Such movements in inflation can affect various market dynamics. A closer look at the factors contributing to this rise may provide insights into economic conditions.

A jump from 0.11% to 1.23% means prices are rising much faster than they were in the previous period. This points to higher costs for goods and services, which could affect spending behaviours. If this continues, businesses might feel the impact through changing demand, and policymakers could react as well.

For traders, inflation figures help gauge what central banks might do next. If prices rise quickly, authorities might step in with measures to slow things down. This can ripple across markets, affecting interest rates, borrowing costs, and investment decisions. We should watch for responses in bond yields and currency markets, as they tend to react quickly to inflation data.

Looking deeper, it’s useful to consider what’s driving this rise. If it’s due to external shocks, like commodity price fluctuations, the effects may be temporary. If it’s tied to structural factors, like rising wages or persistent supply issues, inflation could stick around longer.

Expect market participants to adjust their strategies based on further data releases. Inflation trends influence expectations, shaping how investors price risk and position themselves in derivatives. If future reports confirm a lasting shift, volatility could increase, creating both risks and opportunities.

Mexican President Claudia Sheinbaum seeks to finalise a tariff deal with the US by next Tuesday. This deadline has been established by President Trump.

Sheinbaum stressed the need for a calm approach, advising against misinterpreting Trump’s comments. She underscored the urgency of concluding the agreement, which is tied to ongoing discussions about security and trade matters.

Sheinbaum is pressing to conclude the trade discussions with Washington, aiming to meet the deadline set by Trump. She has urged a steady-handed approach in handling the rhetoric from the White House, cautioning against reading too much into statements that might shift with little warning. Completing the arrangement is not just about trade—it also ties into broader conversations around security cooperation.

Washington’s position remains firm. Trump has repeatedly indicated that failure to finalise the agreement will result in new tariffs. The pressure is mounting, and while talks continue, businesses on both sides of the border are bracing for potential economic effects. The US administration’s strategy appears straightforward: use tariffs as leverage to secure commitments on trade and security policies. This puts Mexico in a position where delay could mean additional costs for exporters.

For traders, particularly those dealing with derivatives, price movements in the coming weeks will be influenced by these negotiations. The direction of tariffs, as well as their likelihood, will play a role in how markets react. Risk pricing will reflect the probability of either a resolution or additional trade barriers.

We have seen Sheinbaum take a measured tone to avoid adding uncertainty to an already complex discussion. Her efforts to maintain a working dialogue with Washington signal that Mexico is looking to minimise economic disruption. Market participants should pay attention to signals from both sides, as developments will shape near-term volatility.

Trump has shown before that he is willing to escalate pressure quickly. At this stage, any perceived hesitation from Mexico could provoke stronger language or even immediate action. This means rapid shifts in sentiment are possible, making it essential to track official statements rather than relying on speculation.

The deadline set for Tuesday leaves little time for drawn-out discussions, meaning any delays or extensions could themselves prompt market reactions. If an agreement is reached, pricing adjustments may come swiftly. Uncertainty surrounding tariffs has already weighed on some sectors, and an outcome—whether positive or negative—will remove some of that guesswork.

Sheinbaum’s strategy so far has been one of engagement rather than confrontation. Whether this leads to a resolution before the deadline remains to be seen, but what is apparent is that preparation is key. Markets do not wait for politicians to finish negotiating; they react in real time to any shift in expectations. Tracking these shifts closely will be essential in navigating the days ahead.

The Pound Sterling (GBP) remained stable against major currencies as the market awaits guidance on the Bank of England’s (BoE) monetary policy this year. The BoE recently cut its key borrowing rates by 25 basis points to 4.5%, indicating a gradual easing approach.

Member Swati Dhingra expressed her support for a faster monetary expansion cycle due to ongoing weak demand. She cautioned that maintaining a gradual approach could leave monetary policy too restrictive by the end of 2025.

GBP/USD declined after reaching a multi-month high, trading quietly below 1.2650 with waning bullish momentum. Early market optimism hindered demand for the US Dollar, impacting the GBP/USD pair.

This means there is uncertainty in the market regarding the direction of monetary policy. The Bank of England has started lowering interest rates, but the pace at which it continues is still unclear. Swati believes that cutting rates too slowly could hold back economic growth, as demand remains weak. If borrowing costs stay high for too long, businesses and consumers may struggle, potentially slowing the economy more than necessary.

Meanwhile, traders have seen the Pound pull back from recent highs against the US Dollar. The initial enthusiasm around the currency faded as the financial markets digested economic data and global sentiment. At the same time, the US Dollar has lacked strength, making currency movements less one-sided.

Monetary policy expectations will shape price action over the coming days. If data suggests that inflation in the UK is falling faster than anticipated, pressure could grow for the Bank of England to cut rates again sooner. That might weigh on the currency. On the other hand, if economic data remains stronger than expected, we could see the markets question whether the central bank is easing too soon. That scenario could provide a floor for the Pound.

What Andrew Bailey and his colleagues say in the coming weeks will be closely examined. Any suggestion that they are reconsidering the pace of rate cuts could shift sentiment quickly. On the other hand, if more policymakers echo Swati’s argument, the expectation for rate cuts could accelerate.

For now, traders will need to watch technical levels closely. The recent rally in GBP/USD has slowed, and whether it holds above key support could determine near-term direction. If bearish pressure builds and the pair breaks key areas, further declines could follow. If it stabilises above recent lows, we might see another push higher, particularly if US Dollar weakness returns.

Bitcoin’s price has fallen below the key range of $90,742–$92,092, a level that has been significant since November. A previous decline below this range on January 13 was brief, reaching a low of $89,164 before recovering to an all-time high of $109,356 on January 20.

Following this peak, Bitcoin tested the floor again but experienced a breakdown that has accelerated recently. This floor has now become a resistance level, and buyers must reclaim it to regain market dominance.

Today, the low found support at $86,520, the 38.2% retracement of the August 2024 rally. If this level holds, it may indicate a retracement-driven correction instead of a complete reversal. However, for an upward trend to resume, the price must surpass the former floor, now acting as a ceiling.

Currently, sellers hold a technical advantage. The path ahead is clear for monitoring market movements.

The latest price action confirms the shift in control. After failing to hold that familiar support zone, pressure has mounted on buyers. The earlier rebound from January’s low briefly inspired confidence, but the continued struggle to reclaim lost ground suggests momentum has changed. Resistance where there was once support is rarely a welcome sign for those hoping for another strong climb.

Retracement levels provide useful context. With the latest dip halting at $86,520, there is still room to argue this is nothing more than a routine pullback within a broader trend. But hesitation around previous support levels often foreshadows further declines, especially when buyers show little strength in reclaiming lost territory. As long as this remains the case, the burden remains on those looking for a recovery to prove we are not in a deeper correction.

What follows from here depends on how this key threshold is handled. If buyers manage to absorb selling pressure and break upwards again, the short-term outlook improves. Otherwise, the risk remains that the market drifts further down, with the 50% retracement level near $83,940 likely to come into focus. That would mark a more decisive shift from simple retracement to something more protracted.

Momentum is in favour of continued downside unless demand reasserts itself convincingly. The need for a breakthrough above resistance remains clear. Until that happens, conditions favour caution.

USD/CAD remains firm at approximately 1.4260, impacted by fears of potential tariffs from the US on Canada and Mexico. Recent inflation figures show Canada’s inflation has stayed below the Bank of Canada’s (BoC) 2% target for three months.

The US Dollar Index is slightly down, around 106.70, despite recovering earlier. President Trump reaffirmed plans for 25% tariffs on imports from both Canada and Mexico, which could negatively affect Canada’s economy.

The USD/CAD has broken from a Descending Triangle pattern, indicating a potential bullish trend. If prices exceed 1.4280, further resistance could emerge at 1.4300 and 1.4380.

Conversely, if the pair falls below 1.4151, it could reach lows of 1.4094 and 1.4020. The Canadian Dollar is influenced by BoC interest rates, oil prices, economic health, inflation, and trade balances, with higher interest rates tending to boost its value.

Considering the present conditions, it is evident that a few forces are shaping what we see with this currency pair. Inflation in Canada has remained below what policymakers at the BoC aim for, staying under 2% for three consecutive months. That alone suggests that tightening monetary policy might not be on the immediate agenda. However, we cannot ignore external pressures. Given what Donald has recently reaffirmed regarding tariffs, there is a real chance of trade disruptions, which could weaken business expectations up north.

That said, while the US Dollar Index has softened slightly to 106.70, it has demonstrated some ability to recover. This matters because changes in the wider strength of the dollar could play into shifts in the exchange rate. If investors continue to interpret what is happening as a reason to favour the greenback, we could see additional USD demand pushing values higher.

Technically, we have already seen a breakout from a Descending Triangle pattern. That suggests an upward push in price action that could carry the pair beyond 1.4280. If that happens, we would likely need to pay attention to barriers at 1.4300 and 1.4380, as those might inspire selling or hesitation among traders. On the other side, if for some reason the pair drops below 1.4151, the focus would shift towards levels at 1.4094 and even down to 1.4020.

At the heart of it all, the value of the loonie will keep reacting to several elements. The BoC’s stance on rates, broader economic health, trade relationships, and energy prices all factor into whether the Canadian currency gains or loses ground. Historically, higher interest rates have been a source of strength for it, making it more attractive compared to lower-yielding alternatives. However, if inflation remains low for an extended period, policymakers may not feel rushed to adjust borrowing costs, leaving the currency exposed to other forces in the meantime.

For those making decisions based on these movements, staying ahead of both political and central bank developments will be as important as reading the charts.

Today’s economic calendar is busy, reflecting ongoing uncertainty in the market. Concerns are emerging due to declines in consumer and business sentiment, which counter early optimism following the election.

The key release is the consumer confidence report from the Conference Board at 10 am ET, with a consensus expectation of 102.5. A drop below 100 could be a cause for concern.

Prior to this, home price data for December will be released at 9 am ET, indicating struggles within the housing sector. Signs of a spring sales lift among entry-level buyers are currently absent.

Alongside the consumer confidence report, the Richmond Fed report will also be available at 10 am ET. Comments regarding tariff uncertainty were noted in the Dallas Fed survey.

Fed officials Barr and Barkin will speak at 11:45 am and 1 pm ET, respectively. Additionally, the tone of the ECB’s Schnabel today was perceived as hawkish.

A packed schedule of economic updates awaits, and each data point carries weight in shaping expectations. The upcoming consumer confidence figure holds particular importance. If sentiment dips below the 100 mark, it could highlight increasing unease among households. That would not be an isolated signal, as views on both personal finances and business outlooks have already softened.

Housing figures released earlier will offer insight into price trends, yet no early signs point to a reversal in sluggish home sales. The absence of demand from first-time buyers suggests affordability remains a hurdle, which could ripple through related markets.

At the same time, manufacturing and service-sector businesses in the Richmond area will provide an additional reading on economic momentum. A weaker result would align with concerns raised in the Dallas Fed survey, where uncertainty surrounding trade policy was a recurring theme.

Later in the day, remarks from Michael and Tom will draw attention. Comments from central bank officials often highlight areas of focus in monetary policy, and any hints of shifting priorities could send ripples through rate expectations. Earlier, Isabel’s confident stance reinforced a firm approach in Europe, contrasting with the more data-dependent statements seen elsewhere.

With these updates on the horizon, awareness of incoming figures is necessary. Adjustments to forecasts and positioning will matter, particularly if incoming data challenges prevailing sentiment.