The ISM manufacturing employment index in the United States rose from 44.9 to 48.1 in January, indicating positive changes in manufacturing jobs.
In the forex market, the EUR/USD fell below 1.1800 as the US dollar gained strength. The GBP/USD briefly reached 1.3640 before making a slight recovery.
Gold prices are under pressure, hovering around $4,600 per troy ounce due to the strong US dollar and a rebound in US Treasury yields. Ethereum is in the spotlight after Bitmine Immersion Technologies acquired about 41,788 ETH.
Ripple’s XRP bounced back to $1.50 last week but is now facing resistance at $1.77. Active addresses on the XRP Ledger dropped below 18,000 over the weekend.
The Dow Jones Industrial Average jumped by 500 points, driven by good manufacturing data and Oracle’s gains. Economic data are affected by the US government shutdown, impacting forecasts and analyses.
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The increase in the ISM Manufacturing Employment Index to 48.1, while still showing contraction, marks a notable improvement from last month. This suggests the downturn in the manufacturing sector might be stabilizing, which is a positive sign for the economy. It lowers the chances that the Federal Reserve will cut interest rates soon.
This manufacturing data aligns with last week’s jobs report, which revealed that the US economy added over 300,000 jobs in January 2026, exceeding expectations. Reflecting back on 2025, the markets expected aggressive rate cuts this year due to slowing growth. However, this recent wave of strong data counters that narrative, indicating resilience in the economy.
For currency traders, this suggests ongoing strength in the US dollar. The EUR/USD pair has already dipped below 1.1800, and further declines could make put options on the Euro an appealing choice. Similarly, the GBP/USD’s pullback towards 1.3600 is likely to continue as expectations for rate cuts by the Bank of England remain higher than those for the Fed.
In the stock market, the Dow’s 500-point rise indicates that traders view strong economic news favorably for corporate earnings. Traders might consider call options on major indices like the S&P 500 to take advantage of this bullish outlook. However, we should keep an eye on rising Treasury yields, as a sudden increase could dampen this optimism.
The outlook for gold derivatives is looking bearish due to the current market conditions. A stronger dollar combined with the potential for higher interest rates increases the opportunity cost of holding non-yielding assets like gold. We expect further pressure on gold, and traders may want to consider short-selling futures or buying puts as it struggles to stay above the $4,700 level.
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