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Crude oil futures rise to $63.96, potential for more gains if they exceed the moving average level
Crude oil futures closed at $63.96, up by $1.31 or 2.09%. This price falls within the swing area of $63.61 to $65.27.
The 100-day moving average sits at $64.73, which is an important level in this range. Earlier this week, prices went below this average and stayed there for the last three trading days.
In July, the Producer Price Index in the United States exceeded expectations, reaching 0.9%.
In July, the Producer Price Index (PPI) in the United States went up by 0.9%, which was much higher than the expected 0.2% increase. This index tracks the average changes in prices that domestic producers receive for their goods over time.
The EUR/USD pair weakened, dropping to around 1.1640 due to the US Dollar gaining strength. Similarly, GBP/USD fell to about 1.3520 as the Dollar surged.
Market Movements and Implications
Gold prices stayed low at approximately $3,330 per troy ounce, impacted by the strong US Dollar and rising US yields. Bitcoin, after hitting a new peak of $124,474, corrected to $121,615, affecting other cryptocurrencies like Ethereum, which approached its earlier highs. Experts believe that trade tensions from the Trump era could worsen, potentially lowering global output by 0.7 percentage points. For trading the EUR/USD pair, it’s crucial to pick brokers with good features to navigate the Forex market efficiently. Foreign exchange trading carries significant risk due to leverage, which can lead to major losses. It’s essential to evaluate your investment goals, experience, and risk tolerance before starting forex trading. If you have doubts, seek independent advice. The July PPI data showed an unexpected 0.9% rise, indicating ongoing inflation. This was supported by the hotter Consumer Price Index report released on August 8, 2025, which highlighted that producer costs are being passed to consumers. Inflation is proving to be stickier than expected.Monetary Policy and Market Trends
Following these reports, the US Dollar has continued to rise through mid-August. This rise is evident in the EUR/USD pair, now testing support at 1.1550, significantly lower than the 1.1640 seen in July. Recent statements from Federal Reserve officials hint at possible interest rate hikes, with the market now pricing in a greater than 70% chance of a rate hike in September. Given this situation, positioning for dollar strength seems wise in the upcoming weeks. Traders might think about buying US Dollar call options or selling futures on the Euro to take advantage of the differing monetary policies. The aggressive rate hikes by the Fed in 2022 serve as a reminder of how long the Dollar could remain strong. The outlook for gold is tough, with prices around $3,300 an ounce. A strong Dollar and rising US Treasury yields make gold, a non-interest-bearing asset, less appealing. It might be best to be cautious with long gold positions and consider put options on gold futures to protect against price drops. The risk of worsening trade tensions adds volatility, especially after the recent announcement of new tariffs on some European goods. This brings to mind the market fluctuations of the 2018-2019 trade disputes, suggesting that using options strategies that benefit from volatility, like straddles, could be advantageous. The VIX, a key indicator of market fear, has recently risen to 19 from a low of 15 last month. Even the cryptocurrency market is showing signs of caution after Bitcoin briefly soared above $124,000 in July. The coin has had difficulty returning to those highs, suggesting that even riskier assets are facing more selectivity among traders. This correction warns that a more aggressive Fed could reduce liquidity first in the most speculative market areas. Over the next few weeks, it’s important to focus on the US Dollar’s direction and manage risks carefully. The high leverage in forex and derivatives trading requires discipline. Our investment strategies need to prioritize managing risks related to central bank policies and geopolitical tensions. Create your live VT Markets account and start trading now.US Producer Price Index, excluding food and energy, exceeded expectations at 0.9%
In July, the Producer Price Index (PPI) in the U.S. increased by 0.9% from the previous month, far surpassing the expected 0.2%. This index measures wholesale inflation and could influence future economic policies.
The EUR/USD pair is facing downward pressure, dropping to around 1.1640 as the U.S. Dollar strengthens due to robust inflation and labor data. The GBP/USD rate also fell to about 1.3520, even with positive economic stats from the UK.
Gold and the Strength of the U.S. Dollar
Gold is weak near $3,330 per troy ounce, hit by ongoing selling pressures. Its decline aligns with the rise of the U.S. Dollar and increasing yields, impacting its status as a safe investment. Bitcoin corrected after reaching a record high of $124,474, now settling at $121,615. This has affected altcoins, with Ethereum approaching its previous peak above $4,800 from November 2021. Economic signals suggest worsening U.S. trade tensions, with a global output reduction forecasted at 0.7 percentage points in the medium term. Markets remain cautious amid changing trade dynamics and fiscal policy. The unexpected 0.9% rise in July’s core Producer Price Index is alarming. Similar pressures in late 2021 preceded significant Federal Reserve rate hikes in 2022 and 2023. This stronger inflation points to a more aggressive Fed approach soon.Expectations for the U.S. Dollar and Precious Metals
Given this data, we anticipate continued strength in the U.S. Dollar. The latest CME FedWatch Tool now indicates a 65% chance of a 25-basis-point rate hike in September, up from 30% last week. It may be wise to buy put options on the EUR/USD, especially as it nears the low of 1.1640, a low not seen since last quarter. The U.S. dollar’s strength and rising bond yields pose challenges for precious metals. With the U.S. 10-year Treasury yield surpassing 4.75%, gold’s appeal as a non-yielding asset is waning. We should consider a bearish stance on gold, using put options or bear call spreads to target a drop below the $3,300 support level. Bitcoin’s retreat from its record high indicates short-term fatigue, likely leading to a period of consolidation. Derivative funding rates on major exchanges have also decreased, suggesting fewer leveraged long positions. In this environment, selling covered calls on existing Bitcoin holdings may be an effective strategy to earn income while anticipating the next price movement. Ethereum nearing its November 2021 high of about $4,800 is a crucial moment. This price could prompt significant profit-taking from long-term holders, creating major resistance. It’s wise to be cautious about new long positions here and consider protective puts as it approaches this key level. Finally, the potential for increased trade tensions adds uncertainty across markets. We’re monitoring the CBOE Volatility Index (VIX), which rose above 20 last week, signaling heightened investor concern. It may be prudent to hedge our equity exposure by purchasing put options on major indices like the S&P 500. Create your live VT Markets account and start trading now.AUD/USD sees sharp decline from Tuesday’s low to today’s high
The AUDUSD fell sharply today, dropping 0.81% from the previous close. After a brief rise to 0.6567, the price began to decline, breaking through important support levels at 0.65407 and going below the 100-hour and 200-hour moving averages.
The decline was driven by Producer Price Index (PPI) data, pushing the price down to a low of 0.6483, close to Tuesday’s low of 0.6481. This drop completes a cycle from Tuesday’s low to today’s high and back to the low. Sellers now have a stronger hand, and further declines could happen if the low is breached.
Reversal Criteria
For a reversal to occur, the pair needs to rise above the 38.2% retracement level at 0.64966 and the 200-hour moving average at 0.6508. Without these moves, sellers will keep their advantage. With the AUDUSD returning to the 0.6483 level, sellers clearly have control. Today’s US Producer Price Index data for July 2025 surprised on the upside at +0.5% month-over-month, suggesting that the Federal Reserve may stay restrictive. The strong rejection from the 0.6567 high indicates weak conviction for upward movement. This US inflation data contrasts with the Reserve Bank of Australia’s recent dovish stance from its early August 2025 meeting. Australian Q2 2025 GDP was also low at 0.2%, highlighting the policy differences that favor a stronger USD. This is a key reason for today’s bearish technical break. The latest economic data from China adds to the pressure on the Aussie dollar. July 2025 industrial production fell short of expectations, indicating a slowdown for Australia’s biggest trading partner. This impacts the commodity-linked currency and suggests further weakness may follow.Strategies And Predictions
In the coming weeks, we recommend buying put options to gain downside exposure. This allows for potential profits if the price drops below the 0.6481 support level while limiting risk to the premium paid. Consider September 2025 puts with a strike price around 0.6400 to take advantage of this trend. Alternatively, for those looking to generate income, selling out-of-the-money call spreads could work well. A bear call spread with the short strike just above the key resistance level around 0.6510 would be profitable if the pair stays below that point. This strategy benefits from a falling price and time decay. This situation is similar to the second half of 2023, when a hawkish Fed and concerns over China’s economy caused the pair to drop significantly. We observed similar technical breakdowns on the hourly chart back then, leading to a multi-week decline. Current price actions suggest that history may be repeating, indicating a possible test of lower levels. Create your live VT Markets account and start trading now.Initial jobless claims in the United States totaled 224,000, missing the forecast.
The initial jobless claims in the United States were reported at 224,000, which is lower than the expected 228,000 for the week ending August 8. This indicates a slight improvement in the labor market during that time.
In the forex market, the EUR/USD is trading below 1.1650 as the US Dollar shows strength, supported by strong wholesale inflation data and positive labor market figures. Similarly, GBP/USD has fallen to around 1.3520, driven by the US Dollar’s rise despite positive economic signs from the UK.
Gold And Cryptocurrency Trends
Gold is facing ongoing selling pressure, trading near $3,330 per troy ounce, following the strength of the US Dollar and increasing US yields. At the same time, Bitcoin has pulled back after hitting a record high, influenced by Ethereum’s upward movement, which is close to its previous peak of over $4,800. In geopolitical news, rising customs revenues and other factors could lead to increased US trade tensions, which may reduce global output by 0.7 percentage points. Additionally, a list of top brokers for trading EUR/USD in 2025 has been created, focusing on features like competitive spreads and quick execution. It is crucial to understand the risks of trading foreign exchange on margin, as these can involve significant investment and potential loss of capital. Always consider your investment goals and seek independent advice if needed.Strength Of The US Dollar
With the recent strong US jobs data, we see a clear sign of economic resilience. The lower-than-expected initial jobless claims of 224,000 underscore a tight labor market. Coupled with the July 2025 Consumer Price Index (CPI) showing inflation at 3.1%, this strengthens the argument for the Federal Reserve to maintain its aggressive approach. For forex traders, this suggests ongoing strength for the US Dollar. The gap in monetary policy is becoming clear, especially as the European Central Bank considers a pause after Eurozone inflation cooled to 2.5%. Traders might consider strategies that benefit from the dollar, such as selling EUR/USD call options or buying USD/JPY futures, anticipating continued momentum for the dollar ahead of the September Fed meeting. The pressure on gold largely stems from the dollar’s rise and rising US Treasury yields, with the 10-year note recently surpassing 4.75%. While gold’s current price near $3,330 is influenced by years of inflation and geopolitical concerns since early 2020, its short-term outlook appears bearish. Traders may want to consider buying puts on gold futures to hedge against or profit from a further decline. In the cryptocurrency market, we observe mixed trends. Bitcoin’s recent decline from its all-time high shows caution as rising interest rates make holding riskier assets more costly. In contrast, Ethereum demonstrates independent strength, nearing its 2021 peak, driven by the successful completion of its network upgrade in early August 2025, which reduced transaction fees. Finally, we should stay alert to the growing US trade tensions, which could negatively impact global growth. This poses a significant risk that might lead to sudden safe-haven buying, disrupting current trends. Thus, using options to hedge our main positions, such as buying puts on major stock indices, is a wise strategy to safeguard capital from unexpected market movements in the coming weeks. Create your live VT Markets account and start trading now.Barkin notes improved business sentiment, but hiring stays stagnant; inflation complicates policy decisions and outlook
Business sentiment seems to be getting better in some areas, but hiring is not one of them. Recent reports show no signs that businesses plan to lay off employees. Consumer data from July, based on credit card spending and other indicators, suggests potential growth.
Challenges Faced By Manufacturers
Manufacturers are still struggling with supply chain issues worsened by tariffs. Many consumers are ready to cut back on spending, making companies cautious about raising prices to cover tariff costs. The Federal Reserve is grappling with policies that feel restrictive when compared to neutral rates. Weak job data from August may be linked to changes in immigration patterns, not layoffs. Tariff-driven inflation complicates policy decisions. Despite market expectations for a 25 basis point rate cut in September, Fed officials are sticking to a neutral policy stance. Fed Chair Jerome Powell will speak at the Jackson Hole Economic Policy Symposium on August 22, 2025, and is expected to maintain this approach, stressing the need for more data to understand the economic landscape. The market is eager to see if Powell hints at any changes or sticks with his current plan. The Fed is sending mixed signals, leading to uncertainty. While the business outlook has improved, this hasn’t translated into new job creation, as evidenced by the July jobs report on August 1, 2025, which showed a modest gain of 155,000 jobs. This cautious approach to hiring, despite no major layoffs, indicates that companies are in a wait-and-see mode. However, recent data suggests consumers are stronger than expected, with July retail sales up by 0.6% month-over-month. This resilience, together with tariffs making it hard for core inflation to dip below 3.4%, gives the Fed reason to pause. A decision to cut interest rates has become more complicated. Despite the Fed’s cautious messages, the market is aggressively anticipating a rate cut in September. Data from the CME FedWatch Tool shows a 65% chance of a 25-basis-point reduction. This difference between the Fed’s communication and the market’s expectations could lead to volatility.Focus On Fed’s Upcoming Speech
All eyes are on Fed Chair Powell’s speech at the Jackson Hole symposium next Friday, August 22. This event will likely drive market movements in the coming weeks. Until he speaks, forming a strong opinion on interest rates or stock indices is risky. For derivative traders, this setup suggests focusing on volatility. Strategies like buying straddles or strangles on indices or currency pairs could profit from significant price movements in either direction following the speech. This rise in implied volatility before a key Fed speech echoes patterns from 2019, when the Fed began its rate-cutting cycle. After Powell speaks, the picture will become clearer. A clear signal for a rate cut would support trades benefitting from lower rates, while a reaffirmation of a data-driven pause would require a more cautious approach. The key is to wait for that signal before taking on substantial directional risk. Create your live VT Markets account and start trading now.United States’ initial jobless claims 4-week average increased from 220.75K to 221.75K
Pressure on Gold
In the United States, the average number of initial jobless claims rose slightly from 220.75K to 221.75K as of August 8. This indicates small changes in the job market amid different economic conditions. The Euro/US Dollar pair faced pressure, slipping below 1.1650 as the US Dollar gained strength, boosted by positive economic reports. Similarly, GBP/USD dropped to daily lows near 1.3530-1.3520, also due to the stronger Greenback. Gold is under selling pressure, hovering around the $3,330 mark per troy ounce. This is mainly due to the rising US Dollar and increased US yields. Bitcoin also corrected after reaching a new high of $124,474, now settling at $121,615.Threat of Trade Conflicts
Signs indicate that the US trade conflict may escalate, potentially reducing global output by about 0.7 percentage points in the medium term. This situation highlights the importance of carefully planning investment strategies, especially in unstable markets, to effectively manage risks. With jobless claims steady at 221.75K, the US labor market seems stable enough for the Federal Reserve to keep its current approach. The July 2025 Consumer Price Index (CPI) showed that inflation remains at 3.1%, giving the central bank little reason to reduce rates. This supports our outlook for a strong US Dollar in the near future. Given the dollar’s strength, we expect currency pairs like EUR/USD and GBP/USD to weaken further. The Euro is particularly at risk, as the manufacturing PMI for the Eurozone on August 1, 2025, showed a contraction at 48.5 for the second consecutive month. We believe buying put options on these pairs could be a smart move to protect against or profit from a continued decline. Gold’s challenges near the $3,330 level are closely linked to the strong US dollar and rising bond yields. The 10-year US Treasury yield reached 4.95% this week, a high not seen since inflation fears in 2024, making gold, which does not yield returns, more costly to hold. We are considering shorting gold futures or buying puts as this pressure is likely to persist. For Bitcoin, the recent drop from its record high above $124,000 indicates a period of consolidation or increased volatility. Open interest in Bitcoin perpetual futures on major exchanges has decreased by 15% from its peak last week, suggesting that some traders are closing positions. We think a long straddle, which involves buying both a call and a put option, could be an effective strategy to take advantage of the expected price fluctuations. The prospect of heightened trade conflicts significantly influences our overall market outlook. This situation resembles the tariff disputes of 2023 and 2024, a time when the VIX index often surged above 25. Therefore, holding some VIX call options or other broad market hedges might be wise to safeguard our portfolio against sudden shocks. Create your live VT Markets account and start trading now.Inflation is at an ideal level, and stock market 401(k)s are thriving as US indices stay stable.
Inflation is now very low, and 401(k) plans in the stock market are doing well. The major market indices have shown slight changes, with the S&P index down by 0.06% and the NASDAQ index down by 0.03%.
Mortgage rates have dropped to 6.58%, the lowest since October. This decrease is encouraging more buyers and may change the market’s outlook. The drop in fixed-rate mortgages aligns with expectations for the Federal Reserve to lower rates further, which could result in lower rates in 2025-26.
Stock Movements and Commodity Prices
In stock movements, TSLA has fallen 20% this year but has bounced back 50% since its low in April. On the other hand, ASTS has surged by 131% with growth expectations. Soybean prices are down by 14 cents, while coffee prices are up due to frost in Brazil. Foreign exchange trading comes with high risks that may not fit everyone. It’s essential to carefully consider your investment goals, experience, and risk tolerance before trading. InvestingLive offers educational content and does not provide investment or trading advice, and they are not responsible for any losses from using their information. With inflation nearly gone and stock markets hitting record highs, there’s a wave of optimism. However, we should remain cautious because markets that seem perfect can be susceptible to sudden changes. This could be an ideal time to buy volatility through options instead of solely betting on further gains. There is strong political pressure for the Federal Reserve to cut rates to 1%. If this happens, it would be a significant change for the bond market. The Fed Funds Rate was above 5% for much of 2023 and 2024, so such a cut could open new opportunities in interest rate futures. Traders are focused on using derivatives based on SOFR to speculate about when and how much the Fed will move next.Market Protection and Potential Geopolitical Shifts
Since the S&P 500 and NASDAQ just reached all-time highs, it’s wise to protect your gains. Buying put options on major indices like SPY and QQQ can directly hedge against a possible market drop. We saw a peak in late 2021 followed by a major correction in 2022, making protective strategies valuable right now. The possibility of a peace agreement between Russia and Ukraine presents a significant geopolitical factor that could quickly impact markets. We could position ourselves for a positive result by using long-dated call options on European stock indices, which would likely rise on good news. This event could also lower certain commodity prices, creating chances for put options on energy or agricultural futures. For individual stocks, the high volatility in names like Tesla, which has rebounded 50% from its April lows, makes options straddles appealing. For stocks like ASTS that have risen over 100% based on future potential, selling covered calls could help generate income from the high implied volatility. This is an ideal environment to use options for managing risk and taking advantage of price swings in specific high-profile companies. Create your live VT Markets account and start trading now.In July, the Producer Price Index in the United States reached 3.3%, exceeding forecasts of 2.5%.
The Producer Price Index (PPI) for the United States in July rose by 3.3% compared to last year, beating the expected increase of 2.5%. This indicates stronger than expected producer inflation for the month.
The EUR/USD currency pair stayed below 1.1700 as the strong US inflation data boosted the US Dollar. Meanwhile, GBP/USD dipped towards 1.3550 after peaking near 1.3600 earlier, also affected by the strong US Dollar.
Gold and Crypto Market Reaction
Gold remained around $3,350, seeing limited recovery due to the strengthening US Dollar and rising Treasury yields after the PPI announcement. In the crypto market, Bitcoin fell slightly to $121,615 following a new high of $124,474, while Ethereum continued to rise, approaching its previous record. Rising trade tensions may emerge from a strong US economy and increasing customs revenue. Additionally, Trump’s trade policies could further influence global production. For those interested in trading the EUR/USD, it’s beneficial to find top brokers that offer good conditions. These brokers accommodate both new and experienced traders aiming to effectively navigate the Forex market. With the July Producer Price Index being higher than expected at 3.3%, the chance of a hawkish Federal Reserve has increased. This unexpected rise in producer inflation is the largest since late 2024 and mirrors earlier inflation issues from 2021 and 2022. Therefore, we can expect the Fed to keep rates higher for a longer time to avoid past mistakes.Market Response to a Strong US Dollar
With the dollar’s quick rally, we expect continued strength leading into the September FOMC meeting. Traders may want to consider options that benefit from a rising dollar, like buying call options on the U.S. Dollar Index (DXY) or put options on the EUR/USD pair, especially since the euro struggles below 1.1700. Implied volatility for major currency pairs has already increased by over 15% since the announcement, indicating the market is preparing for larger movements. The strong dollar and rising Treasury yields create challenges for non-yielding assets like gold. Investors may want to hedge long gold positions with put options or consider selling covered calls against current holdings to earn income while gold remains around $3,350. Similarly, while the crypto market shows promise, Bitcoin’s inability to maintain its new high hints at potential weaknesses in this tightening environment, making protective puts a wise approach. Additionally, we should expect increased volatility in equity markets, as ongoing inflation concerns may pressure company valuations. The VIX, which tracks expected volatility, has risen to its highest level in three months, moving from 14 to just over 17 this week. Buying VIX futures or call options could serve as a direct hedge against potential market downturns in the upcoming weeks. Lastly, the combination of a strong U.S. economy and ongoing trade tensions might lead to more aggressive tariff policies. This political uncertainty adds another risk factor, making broad market hedges even more important for our portfolios. We can use index options on the S&P 500 to safeguard against sudden geopolitical events. Create your live VT Markets account and start trading now.Scotiabank’s strategists say GBP is strong because of positive UK data releases
Pound Sterling (GBP) is stable in the upper 1.35s after the recent UK data releases. The GDP figures for June and the second quarter exceeded expectations, showing increases of +0.4% and +0.3%, indicating stronger activity in manufacturing and services.
In the first half of the year, the UK economy led the G7 with a growth of 1.1%, nearly doubling the US’s 0.6% growth. This has slightly lowered expectations for interest rate cuts from the Bank of England for the rest of the year.
