Analysts expect Ford (F) shares to trade in a tight range during Q2, with moderate upside if margins stabilise. Most firms keep a Hold rating, citing tariffs and EV losses, while strong cash flow is seen as a support factor. Ford Pro growth is noted as a value support, and some forecasts point to a slow recovery if cost controls improve. Weak pricing and wider industry uncertainty are seen as limits on any rebound towards consensus targets. A prior technical update said wave B rose fast and formed a double correction, with scope to move above 13.97. Sellers defended the 14.88 high, and the bearish case requires price to stay below 14.88 and fall towards 7.79–6.05. In the latest update, wave B did not break the wave (X) high and peaked at 14.80 before falling. The outlook now expects an impulse wave C towards the blue-box zone at 8.28–4.26, while a break above 14.88 would suggest wave II ended at 8.36 and shift the structure to a bullish bias. With the price failing at 14.80 and turning sharply lower, we believe the path of least resistance is down. Derivative traders should now position for a decline in the coming weeks, targeting the 8.28–4.26 area. This aligns with the technical expectation of a powerful wave C impulse to the downside. This bearish sentiment is amplified by fundamental pressures we saw solidify last year. Looking back at the full-year 2025 results, the Model e division posted another significant operating loss of over $5 billion, weighing heavily on the stock. While the Ford Pro commercial business remains a bright spot, posting a record EBIT, it isn’t enough to offset the EV drag. Given this outlook, buying put options offers a direct way to capitalize on the expected drop. For traders wanting to mitigate costs and volatility, establishing bear put spreads could be a more prudent approach. These positions would benefit from a steady decline toward our lower targets while defining risk. All bearish strategies must respect the key technical level of 14.88 from last year as an invalidation point. A sustained move above this price would negate the current downward thesis and force a re-evaluation. For now, this level acts as a firm ceiling and a logical point for placing stop-losses. While the overall structure points down, recent data from February 2026 showed a notable 35% year-over-year surge in hybrid sales, which could create temporary support. We should therefore consider options with expirations in late Q2 2026. This allows enough time for the larger bearish pattern to override any short-term strength from the hybrid segment.

Start trading now – Click here to create your real VT Markets account

The US Dollar remained supported as the Middle East conflict kept oil prices high and maintained a risk premium in markets. DXY was testing the top of its nine-month range near 100.35/40. Markets were waiting for central bank decisions, with eight G10 central banks scheduled to set monetary policy this week. Attention was also on whether any ceasefire path or negotiated settlement might reduce current pricing pressures.

Fed Meeting In Focus

The Federal Open Market Committee meeting was expected to be supportive for the Dollar, as the Federal Reserve was seen as resisting current expectations for rate cuts. At the January FOMC meeting, the Fed indicated it wanted clear evidence of lower inflation before delivering further rate cuts. The conflict was linked to a view that US inflation could move towards 3.5% rather than 2.0% this summer. Markets still had about 23bp of additional Fed rate cuts priced in by year-end. A calmer equity tone at the start of Monday suggested DXY might not break higher immediately. The original article stated it was produced using an AI tool and reviewed by an editor. Looking back at the analysis from early 2025, the view was for a stronger dollar driven by Middle East conflict and a Federal Reserve reluctant to cut interest rates. This perspective was based on a DXY testing the top of its range near 100.40. That situation gave us a clear signal for dollar strength at the time.

What Changed Since Then

The conflict premium in energy markets did initially materialize, pushing WTI crude to nearly $95 per barrel in mid-2025, but that pressure has since eased. As of early March 2026, WTI is trading much lower, around $78 per barrel, as global supply concerns have abated. This has removed a key pillar of support for the dollar that was anticipated last year. The Federal Reserve did push back against rate cut expectations for most of 2025, as expected. However, with the latest CPI report for February 2026 showing headline inflation has cooled to 2.8% year-over-year, the FOMC finally delivered a 25 basis point cut in January. This pivot from the central bank is a major change from the environment we were watching last year. While the DXY did break higher through 2025, it has since retraced and is now holding near 101.50, well off its peaks. Current market pricing, reflected in fed funds futures, now indicates a more than 70% probability of another rate cut by the May 2026 meeting. This suggests the path of least resistance for the dollar is now lower. Given this shift, we should consider strategies that benefit from a softer dollar and falling interest rate volatility. Buying call options on pairs like EUR/USD offers exposure to dollar weakness with defined risk. Additionally, with the Fed’s path now appearing clearer, selling volatility through instruments tied to the VIX index could prove profitable as uncertainty subsides. Create your live VT Markets account and start trading now.

Start trading now – Click here to create your real VT Markets account

Brown Brothers Harriman’s Elias Haddad expects the Reserve Bank of Australia to raise the cash rate target by 25 bps to 4.10% for a second meeting in a row. The decision is described as a close call, with cash rate futures implying 53% odds of a hike. A rise to 4.10% is presented as the base case, with the Australian Dollar expected to be supported if the RBA tightens policy. The context given is elevated domestic inflation.

Rba Decision Outlook

Headline inflation in Australia is reported at 3.8% year on year, even before an energy shock takes effect. The RBA’s internal models are said to show a positive output gap, linked to tighter capacity constraints. The article states it was produced using an Artificial Intelligence tool and reviewed by an editor. A back-to-back rate hike to 4.10% is seen as likely, though we recognize this is a close call. Market pricing from cash rate futures implies a 53% chance of a 25 basis point increase by the Reserve Bank of Australia. Our view is that a hike would provide some needed support for the Australian dollar. This situation feels similar to what we saw back in mid-2025 when high inflation was the primary driver of policy. Looking at the data today, the most recent quarterly figures show headline inflation is stubbornly high at 3.6% year-over-year, which is well above the RBA’s target range. This persistent price pressure, especially in services, makes a strong case for the central bank to act again.

Trading And Positioning Ideas

However, the futures market is currently pricing in only a slight chance of a hike at the next meeting, with most participants expecting a prolonged pause. This disconnect between persistent inflation data and market expectations creates an opportunity. The market seems to be underestimating the RBA’s resolve to fight inflation, much like it did at key points last year. For traders who believe a hike is more probable than the market suggests, buying near-term Australian dollar (AUD) call options is a defined-risk way to position for a stronger currency. This allows for upside participation if the RBA delivers a hawkish surprise. Selling out-of-the-money AUD put options is another strategy to collect premium, based on the view that the downside for the currency is limited. Given that this is considered a close call, implied volatility on the AUD is likely to rise heading into the RBA meeting. A long straddle, which involves buying both a call and a put option with the same strike price and expiry, could be effective. This position profits from a significant price move in either direction, whether from a surprise hike or a surprisingly dovish statement. Traders can also look at interest rate futures to express a view on the RBA’s path. If we anticipate a hawkish surprise, shorting Australian 3-year government bond futures would be a direct play on rising yields. This position would profit if the central bank signals that rates will need to stay higher for longer than the market is currently pricing in. Create your live VT Markets account and start trading now.

Start trading now – Click here to create your real VT Markets account

EUR/GBP has moved below its 200-day moving average, with the 200-DMA now at 0.8690. The pair is testing the February low near 0.8610, which may act as short-term support. If EUR/GBP cannot move back above 0.8690, the decline may continue. A break below 0.8610 would keep the pattern of lower highs and lower lows on the daily chart.

Key Downside Levels

Further downside levels include the lower edge of the falling channel near 0.8580. Another projected level sits around 0.8535. The euro, sterling, Bunds and Gilts are described as at or near oversold levels. The note also says they are due a bounce. The EUR/GBP cross has broken below its 200-day moving average and is now testing the key 0.8610 support level. This technical weakness suggests that the path of least resistance is lower. We should be prepared for an extension of this downtrend in the coming weeks. Given this outlook, we believe positioning for further downside is the appropriate strategy. Traders could consider buying put options with strike prices near 0.8580 or even 0.8535 to capitalize on a breakdown. These levels represent the next logical targets if the 0.8610 support fails to hold.

Fundamental Backdrop

This bearish view is reinforced by fundamental factors, as recent data from early 2026 shows UK inflation remaining stubbornly above target at 2.8%, while Eurozone inflation has cooled to 2.1%. This divergence suggests the Bank of England will be forced to keep interest rates higher for longer than the European Central Bank. The current interest rate differential of a full percentage point between the BoE and ECB continues to favor sterling. However, we must note that the pair is technically oversold, making a short-term bounce possible. A prudent approach would be to use any rally back towards the 0.8650-0.8690 resistance area as an opportunity to enter new bearish positions at more favorable levels. This allows us to sell into strength rather than chase the market lower. Looking back, we saw a similar dynamic play out in the fourth quarter of 2025 when the pair repeatedly failed to sustain gains above the 0.8700 level. Each failure was followed by a swift decline, reinforcing the underlying bearish trend that has been in place for some time. That period confirmed the market’s willingness to sell the euro against the pound on any sign of relative economic strength from the UK. Create your live VT Markets account and start trading now.

Start trading now – Click here to create your real VT Markets account

Gold (XAU/USD) fell for a fourth straight session, trading near $5,000 per troy ounce in European hours on Monday. Rising energy prices have fuelled inflation concerns and reduced expectations of interest-rate cuts by the US Federal Reserve and other major central banks. The US attacked Iran’s main oil-export hub on Kharg Island over the weekend, raising fears over global supply. President Donald Trump said oil infrastructure was not hit, but Iran launched retaliatory strikes on Israel and energy sites in other Arab countries, as the US–Israeli war on Iran entered its third week.

Safe Haven Demand Cools

Gold also weakened as demand for safe-haven assets eased after reports that the US may form a coalition to escort shipping through the Strait of Hormuz. Trump urged the UK, France, China, and Japan to help secure the route, while EU foreign ministers met in Brussels to discuss a possible naval response to the Strait’s effective closure. US Energy Secretary Chris Wright said he expects the conflict to end within “the next few weeks”. He suggested this could allow oil supplies to recover and energy prices to fall. Central banks added 1,136 tonnes of gold worth around $70 billion to reserves in 2022, according to the World Gold Council. This was the largest annual purchase since records began. With Gold pulling back from the $5,000 level, the immediate derivative play is cautious and short-term bearish. The market is currently selling off based on hopes that a multinational naval coalition will secure the Strait of Hormuz and that the conflict will end soon. This suggests that short-dated put options or selling covered calls on gold ETFs could be viable strategies for the next one to two weeks.

Managing Event Risk

However, we must recognize the immense risk if this de-escalation narrative fails. About 20% of the world’s total oil consumption passes through the Strait of Hormuz, and any further disruption would cause a severe energy shock. This makes holding purely bearish positions dangerous, as a single negative headline could send gold prices surging again. The key driver here is the impact of energy prices on US Federal Reserve policy, a pattern we saw repeatedly through 2024 and 2025. Persistent inflation from high energy costs is pushing expectations for interest rate cuts further out, strengthening the US Dollar. This environment is a direct headwind for non-yielding gold and supports the current downward price pressure. Despite this, we should not ignore the underlying support for gold from central banks. The massive buying trend we observed from 2022 to 2025, led by institutions like the People’s Bank of China which bought gold for 17 straight months, has established a strong floor. This suggests the current pullback could be an opportunity to purchase longer-dated call options at a lower premium, positioning for a potential re-escalation of the conflict. Given the uncertainty, volatility itself is a tradable asset. The wide gap between the official optimistic statements and the severe on-the-ground risks means implied volatility in both gold and oil options is likely to remain elevated. We remember how quickly markets turned during the initial phases of the Ukraine conflict in 2022, and this situation feels similarly unstable. Create your live VT Markets account and start trading now.

Start trading now – Click here to create your real VT Markets account

USD/JPY is close to 160, which is linked to higher chances of official action to support the yen. Japan and South Korea have increased verbal efforts to defend their currencies, including a rare joint statement on concern about fast falls in the JPY and KRW. Japan has said it is in closer contact than usual with US authorities. This has raised attention on possible steps such as a rate check or direct yen-buying intervention.

Imported Inflation And Energy Risks

Officials are concerned that further yen weakness could lift imported inflation through higher energy prices linked to the Iran War. The aim is to limit extra pressure on household living costs. A surprise Bank of Japan rate rise at its 19 March meeting is presented as a possibility. The BOJ has told Parliament that exchange rate swings now have a stronger effect on underlying inflation and inflation expectations than in the past. The article notes it was produced using an artificial intelligence tool and then edited. It also describes the FXStreet Insights Team as selecting market observations from experts and adding analysis from internal and external sources. We see USD/JPY approaching the critical 160 level, dramatically increasing the chance of direct market intervention. Japanese and South Korean officials are now openly expressing serious concern over their weak currencies. Tokyo’s closer-than-usual contact with US authorities suggests that coordinated action is a real possibility.

Policy Intervention And Positioning Risks

The Bank of Japan meeting on March 19 is now a major risk event, with a surprise rate hike on the table. This potential for a sudden policy shift has caused one-week implied volatility for USD/JPY to spike above 15%, reflecting deep uncertainty. Traders should be wary of holding simple long positions going into the announcement, as a hike could trigger a sharp sell-off. We must prepare for the Ministry of Finance to act independently, even if the BOJ remains on hold. Authorities are worried that high energy prices will fuel more inflation, giving them a strong motive to defend the currency. Buying out-of-the-money JPY calls (USD/JPY puts) could be a prudent way to hedge against a sudden, multi-yen drop caused by intervention. Looking back at 2025, we saw authorities step in with yen-buying operations when the currency’s weakness became a political issue, so this isn’t an empty threat. Recent CFTC data shows speculative net short positions against the yen have swelled to their largest since early last year, creating a crowded trade vulnerable to a sharp reversal. Japan’s core inflation, which came in at 2.4% last month, provides the domestic justification for a more aggressive policy stance. Create your live VT Markets account and start trading now.

Start trading now – Click here to create your real VT Markets account

Standard Chartered research links higher oil prices to faster rises in global food inflation, mainly through higher fertiliser costs and trade bottlenecks. It says country outcomes depend on food’s weight in CPI baskets, reliance on imports, and dietary patterns. The analysis says global fertiliser trade is more exposed to disruption at the Strait of Hormuz than other production inputs. It adds that fertiliser affordability was already pressured by protectionist measures in major economies, including China and the EU.

Government Policy Response So Far

It notes that, since the US/Israel-Iran war began, governments have not introduced new market steps aimed directly at containing food CPI inflation. The reasons given include that natural gas prices, which matter more than oil for fertiliser production, have often proved more short-lived than oil-price spikes, and that governments already have large structural commitments to agriculture. The report states that global food inflation and headline CPI inflation tend to move closely together. It cites an IMF estimate that a 10% rise in oil prices over a year could add about 40bps to global inflation. It also says differences in consumer psychology may lead to wide variation in food CPI inflation across countries, as people focus on frequently bought items. Given the recent strength in oil prices, we are positioning for a knock-on effect into global food inflation. Brent crude has been stubbornly holding above $95 per barrel through early March, a direct consequence of the continued geopolitical tensions in the Strait of Hormuz that escalated throughout 2025. This sustained high price environment is the primary signal for our short-term outlook.

Fertilizer Pass Through And Market Positioning

The pass-through to food costs is happening quickly through the fertilizer channel, as expected. North American fertilizer price indexes have already climbed over 15% since December, creating a direct upside risk for agricultural producers’ input costs. We see this as a clear leading indicator for the prices of key agricultural futures in the coming quarter. This situation is made worse by the protectionist measures we saw from major economies last year. China’s export restrictions and the EU’s carbon tariffs had already tightened the global fertilizer market before the most recent energy price spike began. Those pre-existing strains mean that any new shock, like higher oil costs, has an amplified effect on affordability and, ultimately, food prices. The FAO Food Price Index supports this view, showing a 2.5% jump in the latest February reading, its third consecutive monthly increase driven by cereals and vegetable oils. This confirms the inflationary trend is not just theoretical and is already being reflected in global data. We anticipate upcoming national CPI reports for February and March will show food as a key driver of stubborn headline inflation. Historically, a 10% sustained rise in oil prices can add about 0.4% to global inflation, and we’ve seen a greater increase than that since late 2025. Therefore, we are considering positions that would benefit from higher-than-expected inflation prints, such as inflation swaps or short positions on interest rate futures. Central banks may be forced to maintain a more hawkish stance than the market is currently pricing in. Consumer behavior will likely amplify these effects, as shoppers are highly sensitive to the cost of staple goods. The resulting pressure on household budgets could negatively impact consumer discretionary spending. We are therefore looking at protective put options on consumer-focused ETFs, as well as positions in volatility indexes, to hedge against the market uncertainty this inflationary pressure will create. Create your live VT Markets account and start trading now.

Start trading now – Click here to create your real VT Markets account

The Canadian Dollar has started to gain support from higher oil prices, but structural factors and its close link to the US Dollar may limit how far it can strengthen. Commerzbank keeps its USD/CAD forecast at 1.37 for H1 2026. If oil prices settle above $100 per barrel during an ongoing war in the Middle East, the Canadian Dollar could gain further. In that case, Canada’s real interest rate gap versus many European currencies could widen if European central banks raise rates slowly due to weaker economic conditions.

Oil Prices And Canadian Dollar Limits

EUR/CAD could move to lower levels during an energy price shock, driven mainly by a weaker euro and improved Canadian terms of trade. For USD/CAD, lower levels are still seen as more likely only in the second half of the year. The article notes it was produced with the help of an AI tool and reviewed by an editor. It is attributed to the FXStreet Insights Team, which compiles market observations and analyst notes. We are seeing the Canadian dollar get some support as WTI crude oil prices hover just above $102 a barrel, driven by ongoing geopolitical tensions. However, this strength is being limited by the robust US dollar, which is benefiting from recent strong US jobs data and sticky inflation figures. This push-and-pull creates a relatively stable environment for the USD/CAD pair. For the coming weeks, the 1.3700 level for USD/CAD looks like a central point. Given that last month’s Canadian inflation data showed a slight cooling to 2.7%, the Bank of Canada is not under pressure to act aggressively, reinforcing this range. Derivative traders might consider strategies that profit from low volatility, such as selling strangles with strikes placed well outside an expected 1.3550-1.3850 channel.

Trading Views For Major Cad Pairs

This situation feels familiar when we look back at the second half of 2025. During that period, we saw a similar spike in energy prices, yet the USD/CAD exchange rate failed to break below 1.35 due to the US Federal Reserve’s consistently hawkish tone. We expect this theme of US economic outperformance to continue capping significant Canadian dollar gains. Therefore, for traders looking to express a bullish view on the Canadian dollar, doing so against the euro may be more effective. With the European Central Bank still signaling caution due to weaker regional growth, the EUR/CAD cross could see downward pressure. Buying puts on EUR/CAD could be a more direct way to play the terms-of-trade advantage for Canada. The key risk to this stable outlook for USD/CAD would be a sudden de-escalation in the Middle East, which could send oil prices tumbling below $90. Conversely, if US inflation data for February, due next week, comes in surprisingly soft, it could weaken the US dollar and push the pair lower. We must remain watchful of these key data points and headlines. Create your live VT Markets account and start trading now.

Start trading now – Click here to create your real VT Markets account

EUR/USD erased most early gains and traded near 1.1415 during European hours on Monday, as the US Dollar recovered part of its earlier losses. The US Dollar Index was down 0.15% at about 100.35, close to Friday’s over nine-month high of 100.54. The US Dollar stayed broadly firm as oil prices rose and market mood turned risk-off amid tensions involving the US, Israel, and Iran. Higher oil prices have also lifted inflation expectations globally.

Focus On Fed And ECB Decisions

Markets are focused on upcoming policy decisions from the Federal Reserve on Wednesday and the European Central Bank on Thursday. Both are expected to keep interest rates unchanged. The Fed is expected to hold rates steady as the oil-price jump linked to the Strait of Hormuz has pushed inflation expectations away from prior levels. CME FedWatch data indicates expectations that the Fed will keep rates unchanged across another four policy meetings. The ECB is also expected to keep rates steady, with price pressures remaining close to the 2% target for a sustained period. Looking back at the situation in late 2025, we saw the US Dollar strengthen due to geopolitical risks and a spike in oil prices. The EUR/USD was under pressure around 1.1415 as both the Fed and ECB were expected to hold interest rates steady. This created a period of uncertainty where defensive positioning was key.

Shifting Macro Backdrop

That risk-off sentiment has since eased, and the conflicts that pushed Brent crude above $110 per barrel in late 2025 have cooled. As of this morning, Brent is trading closer to $85, significantly reducing the inflation threat that kept the Federal Reserve on hold. This changes the entire landscape from what we were anticipating just a few months ago. With the oil threat diminished, the focus is now back on core inflation, which has fallen to 2.8% in the latest US CPI report. This has shifted market expectations, and the CME FedWatch Tool now indicates a nearly 70% probability of a Fed rate cut by July 2026. We’ve seen this pattern before, where the Fed pivots quickly once an external inflation shock subsides. Meanwhile, the European Central Bank faces a different problem with recent data showing Eurozone economic growth slowing to just 0.4% annually. While their inflation is stable at 2.3%, the sluggish growth puts immense pressure on the ECB to consider cutting rates sooner than the Fed. This growing policy divergence is a major theme for us moving forward. Given this divergence, we see potential weakness in the EUR/USD pair. Traders should consider buying put options on the EUR/USD to position for a potential decline. Specifically, options with a strike price around 1.0950 expiring in the third quarter of 2026 could offer a favorable risk-to-reward profile. Create your live VT Markets account and start trading now.

Start trading now – Click here to create your real VT Markets account

Deutsche Bank economists expect the Federal Reserve to keep interest rates unchanged at this week’s meeting. They expect the Fed to refer to elevated geopolitical uncertainty and inflation risks linked to oil. They expect only small changes to the policy statement. They also expect Chair Powell to focus on how recent events affect financial conditions, mainly through higher energy prices.

Core Inflation And Oil Risk

Core PCE inflation has posted two monthly rises of 0.4%. This has lifted the year-on-year rate to 3.1%, the highest since early 2024. They expect the dot plot to continue pointing to one rate cut in 2026. They add that the rate outlook depends heavily on oil staying near or below $100 per barrel. They expect this week’s incoming data to be unlikely to change the meeting’s overall tone. The article notes it was produced using an AI tool and reviewed by an editor. With the Federal Reserve expected to hold rates this week, there is a clear disconnect with market pricing. Fed funds futures are still implying almost two rate cuts by the end of 2026, a scenario that now seems overly optimistic. This suggests positioning for a “higher for longer” reality by selling near-term interest rate futures.

Volatility And Equity Hedging

We are seeing Core PCE inflation re-accelerate to 3.1%, a high we haven’t seen since the first quarter of 2024, largely due to energy prices. WTI crude recently touched $95/bbl amid renewed supply concerns, making the Fed’s key $100 threshold look fragile. Options strategies that profit if oil prices breach that critical level could serve as a direct hedge against the Fed staying hawkish. This elevated geopolitical and inflation uncertainty means overall market volatility may be underpriced. The VIX has been hovering around a relatively subdued 16, which may not fully reflect the risks Powell is likely to highlight. We should consider buying calls on volatility indices as a potentially cheap way to insure against a sudden market downturn. This persistent high-rate environment poses a threat to equities, particularly the technology and growth stocks that powered the market through much of 2025. A hawkish pause from the Fed challenges the lofty valuations that depend on lower borrowing costs. Purchasing put options on stock indices like the Nasdaq 100 is a prudent way to hedge against a potential correction. A more restrictive Fed should also provide strong support for the U.S. dollar. The Dollar Index (DXY) has already reversed the downtrend we saw in the latter half of 2025. Derivative plays that bet on continued dollar strength, especially against currencies whose central banks are signaling cuts, look attractive. Create your live VT Markets account and start trading now.

Start trading now – Click here to create your real VT Markets account