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The GDT price index in New Zealand fell from 1.1% to 0.7% compared to earlier.
The New Zealand Global Dairy Trade (GDT) Price Index fell from 1.1% to 0.7%. This decline indicates changes in the dairy market.
In currency markets, the AUD/USD pair is unstable, hovering around 0.6470 due to ongoing trade discussions and a recovering US dollar. The EUR/USD pair remains below 1.1600 amid uncertainty about the Federal Reserve’s leadership.
Gold’s price fluctuates around $3,400, impacted by the US dollar’s direction and varying US yields. In the crypto market, Ethereum saw notable activity after SharpLink Gaming acquired over 83,000 ETH, coinciding with a record $465 million outflow from ETH ETFs.
The economic outlook for the euro area has improved due to increased spending plans in Germany and a recent EU-US agreement, although there are still risks of further rate cuts. Economic stability could help avoid a downturn, but weaker wage signals might lead to future adjustments.
For those trading EUR/USD, there are top brokers available with competitive spreads and strong platforms to support both new and experienced traders in the changing Forex market.
The Global Dairy Trade index is showing signs of weakness, which may lead us to consider short positions on milk powder futures or buy put options expecting more price drops. Recent reports from major New Zealand producers in late July 2025 confirmed expectations of increased output this season, adding to selling pressure.
The Australian dollar is choppy around the 0.6470 level, influenced by trade news and a stronger US dollar. This volatility creates opportunities, making it a good time to explore buying straddles on the pair. Implied volatility for one-month AUD/USD options has jumped to 12.5%, indicating the market anticipates significant movement soon.
With EUR/USD struggling below the 1.1600 resistance level, there’s a chance to use bearish strategies. Selling call spreads with a strike price just above 1.1600 might be a smart way to play this ceiling. The uncertainty regarding the Federal Reserve’s leadership, coupled with last week’s slightly higher US inflation report for July, is likely to support the US dollar against the euro.
Gold remains steady near the $3,400 per ounce mark, a price that seemed unbelievable just years ago. We suggest selling covered calls on existing long positions to generate income while gold consolidates. The price is held back by a strong US dollar and US 10-year yields, which have been stable just below 5.0% for weeks.
Ethereum shows conflicting signals, with a huge corporate purchase on one side and record ETF outflows on the other. This tug-of-war creates volatility, which we can trade using long strangles to profit from major price swings in either direction. Ethereum’s 30-day realized volatility exceeds 90%, highlighting sharp differences in market expectations for its next movement.
While the euro area shows some economic strength, we are closely monitoring signs of future rate cuts from the European Central Bank. The recent Q2 wage growth data slowed to 2.8%, providing the ECB with reason to ease policy later this year. This supports our cautious to bearish view on the euro, suggesting that any rallies in EUR/USD may present selling opportunities.
Canadian foreign minister reports positive trade discussions with the United States and Mexico
Canada’s foreign minister has said that trade talks with the United States are going well. These discussions also include plans to work closely with Mexico.
The goal is to improve supply chains and ensure energy security. Ongoing conversations show that these countries are committed to enhancing their economic relationships.
Reducing Political Risk
These positive discussions indicate a decrease in political risk between the United States and Canada. For traders, this suggests a good opportunity to sell volatility in Canadian assets, as uncertainty often diminishes with favorable diplomatic news. Recently, Canada’s volatility index, the VIXC, has been around 17, and this news might push it closer to its average of 14. The Canadian dollar, which has been struggling against the USD, could gain support from this development. As of August 2025, the currency has had difficulty staying above $0.72 USD due to global growth worries. This news may be a reason to buy call options on the CAD, aiming for a rise back to the $0.735 level seen earlier this year. This progress is especially important as we approach the CUSMA trade pact review set for mid-2026. Early signs of cooperation can help reduce fears of major political conflicts later, which has been a significant market concern. This reduction in risk makes long-term bullish positions more appealing.Emphasizing Energy Security
Focusing on energy security sends a strong message to the Canadian energy sector. U.S. imports of Canadian crude oil are already up by 4% year-over-year through July 2025. Plans to deepen this trade relationship are very positive. Traders should think about buying call options on Canadian energy ETFs or major producers. Additionally, strengthening supply chains will benefit logistics and manufacturing companies across the border. Rail volumes for firms like Canadian Pacific Kansas City have steadily increased throughout 2025. This news supports that trend, making bull call spreads on key industrial stocks a smart move for the upcoming weeks. Create your live VT Markets account and start trading now.Commerzbank suggests that the Swiss franc may recover slightly with a U.S. trade agreement.
The Swiss franc could see a slight boost if Switzerland manages to secure a trade deal with the United States before the Thursday deadline, according to Commerzbank.
Without a deal, Switzerland risks facing a 39% tariff on its exports to the U.S. Commerzbank expects the Swiss government to present a “better offer” to avoid this outcome.
Costs of a Trade Agreement
Commerzbank believes a costly agreement will likely be reached but it may end up being pricier than previously thought. This agreement is expected to support the franc and keep the EUR/CHF rate near 0.9300. If trade tensions worsen and no deal is made, the franc could feel more pressure. With the deadline approaching, the implications are significant, affecting both Swiss exporters and broader currency trends across Europe. With only two days left until Thursday, August 7th, we are monitoring for a last-minute trade agreement between Switzerland and the United States. The threat of a 39% tariff on Swiss exports creates considerable uncertainty and has driven the franc’s recent movements. Since the U.S. is Switzerland’s largest export market, having accounted for over CHF 65 billion in goods last year, Swiss officials are likely to work hard to finalize a deal. The costs of not reaching an agreement are too high to ignore, so we expect an improved offer from Switzerland to emerge before the deadline.Currency and Trading Strategies
For traders, this indicates we can expect a small rebound for the Swiss franc this week. The currency has faced pressure, with USD/CHF rising nearly 2% over the past three weeks to around 0.9050. A trade agreement would likely reverse some of these recent losses. One strategy to consider is using short-term call options on the franc, which would profit from a sudden rise in value. Implied volatility for August options has jumped over 15% recently, reflecting market concerns. This suggests that, while options are more expensive, a significant market move is anticipated. However, if negotiations fail, the franc may face renewed selling pressure. In that case, EUR/CHF could break its recent range around 0.9300 and rise sharply. Traders should be prepared for this scenario, although it’s less likely. We observed a similar volatility pattern in the franc during the last stages of the EU framework negotiations in 2021. Historically, the currency reacts strongly to major trade policy updates. The current situation with the U.S. appears to be following this trend closely. Once the deadline passes this week, focus will likely shift back to the Swiss National Bank’s policies. Even if a trade deal is reached, any strength in the franc could be short-lived if inflation data later this month indicates further cooling. The SNB has already cut rates twice since early 2024, and another cut this year remains a possibility. Create your live VT Markets account and start trading now.The 52-week bill auction in the United States dropped to 3.76% from 3.925%
The rate for the United States 52-week bill auction has dropped to 3.76% from the previous 3.925%. This means buyers at the auction are seeing lower yields.
In the currency market, AUD/USD has been fluctuating around 0.6470, showing both gains and losses. On the other hand, EUR/USD remains below 1.1600, with the U.S. dollar continuing to gain strength, and yields showing inconsistent movement.
Gold’s Market Activity
Gold prices changed slightly on Tuesday, hitting around $3,400 before settling at approximately $3,380 per troy ounce. This movement occurred amid mixed U.S. yield patterns and uncertainty regarding the U.S. dollar’s direction. Ethereum experienced a significant outflow, with ETFs showing a $465 million withdrawal in one day, despite big purchases by corporate investors. This contrasts with Ethereum’s price, which couldn’t stay above $3,700. In Europe, the economy is showing strength, thanks to positive developments like the EU-US deal and increased German spending. However, there’s still a chance of a final rate cut towards the end of this year or early 2026, depending on wage trends. With the decline in the 52-week U.S. bill auction rate, the market seems to expect lower interest rates from the Federal Reserve. The drop to 3.76% indicates that we might want to consider options that benefit from falling yields, such as call options on Treasury futures. Recent data showing U.S. headline inflation cooling to 3.1% in July 2025 suggests that the Fed’s tightening cycle from 2022 to 2024 might be over.Potential Currency Fluctuations
The dollar’s strength against the euro, keeping EUR/USD under 1.1600, paints a different picture. This difference is likely due to Europe’s own economic issues, especially after surprising data showed a dip in German industrial production. We might want to use put options on the EUR/USD, betting that the European Central Bank could cut rates before the Fed does. Gold’s price near $3,400 per ounce makes it a key player in this uncertainty. The falling yields on government bills reduce the cost of holding gold, making it a more appealing option. Looking back at how gold rose in 2020 when real yields dropped, we can expect more strength if yields continue to fall. For Ethereum, the large $465 million ETF outflow is a concerning sign that institutional interest might be decreasing. This selling pressure makes it hard for the price to maintain any rise above $3,700. Therefore, we should consider buying put options to guard against a drop toward earlier support levels. The fluctuations in AUD/USD around 0.6470 show global uncertainty, with traders uncertain about commodity demand. Given this unclear trend, we think using strategies that benefit from volatility, like straddles or strangles, is a better approach than making simple directional bets. This method allows us to take advantage of price swings in either direction over the next few weeks. Create your live VT Markets account and start trading now.Gold rebounds near $3,350 as Fed cut speculation limits downside risks
Gold’s value has risen for the fourth consecutive day, finding support around $3,350, thanks to a weaker US Dollar. After some early troubles in Europe, buyers pushed prices up from intraday lows near the 50-day Simple Moving Average. Currently, Gold (XAU/USD) trades at about $3,380, showing a 0.20% increase during US trading hours. Market focus is now on US tariffs, which may impact global market stability.
Recent US PMI data showed mixed results, with the S&P Global Services PMI at 55.7, exceeding expectations, while the ISM Services PMI came in lower at 50.1. This suggests that the private sector remains resilient despite some setbacks. Following last week’s losses, markets have bounced back, driven by hopes for Federal Reserve interest rate cuts. The MSCI All-Country World Index and Nasdaq have risen along with other markets.
US Dollar Impact
The US Dollar has weakened due to lower US Treasury yields and disappointing economic data. Even with these challenges, bond yields remain close to recent lows, supporting Gold prices despite weak hiring and order data in the services sector. The US Dollar Index is fluctuating around 98.70. Total gold demand has increased, with investment demand rising, even as jewellery consumption has decreased. Central bank purchases have slowed slightly but remain strong, with expectations for significant annual acquisitions. Market sentiment is leaning towards interest rate cuts, driven by issues like geopolitical tensions and inflation worries, which boost Gold’s appeal. San Francisco Fed President Mary Daly noted uncertainty about potential rate cuts, despite softening economic indicators. Additionally, mixed US economic releases provide insights into consumption, services, and trade activities. Technical analysis suggests that Gold has faced resistance but may reach new highs if current momentum persists. Indicators like RSI and MACD show neutral positions with easing bearish pressure. Gold tends to move inversely with the US Dollar and other assets, serving as a hedge during unstable times. Price movements in Gold often respond to geopolitical events, interest rates, and Dollar strength, making it a safeguard against inflation and currency devaluation.Investment Strategies
With the current upward trend, we see a good chance to position for higher gold prices in the coming weeks. The combination of a weaker US Dollar and expectations for Federal Reserve rate cuts creates a favorable environment. Strategies that benefit from a rise above the current $3,380 level should be considered. For a straightforward bullish approach, we are looking at buying call options with strike prices above $3,400. This allows us to benefit from price increases while limiting our initial risk to the premium we pay. Technical indicators suggest that the recent rally has more room to grow, with less bearish pressure. The case for Fed cuts is gaining strength, which historically supports gold prices. The latest July 2025 inflation report showed the Consumer Price Index cooling to 2.8%, giving the Fed more room to consider easing policies. Reflecting on the rate-cutting cycle that started in mid-2019, gold experienced a significant multi-month rally, a pattern we might see again. We should also explore selling out-of-the-money put options to collect premiums, using strike prices near the $3,350 support level. This strategy can be profitable if gold remains steady or rises, benefiting from price stability and time decay. It’s a safer way to express a bullish-to-neutral view on Gold. The weakness of the US Dollar looks to support our perspective. The US Dollar Index has dropped over 2.5% from its highs near 101.50 in May 2025. As long as US Treasury yields stay low and economic data is mixed, the Dollar seems likely to weaken further, which would directly benefit Gold. We need to stay alert for potential volatility from US tariff announcements or a more aggressive stance from the Federal Reserve. The CBOE Volatility Index (VIX) is around 19, indicating underlying market concerns that could either enhance Gold’s safe-haven status or cause sharp reversals. Using defined-risk options strategies can help us manage any sudden market changes. Create your live VT Markets account and start trading now.Trump plans to announce his Federal Reserve appointments, including the Fed chair, soon.
US President Donald Trump announced that a trade deal with China is close. He also plans to raise tariffs on imports from India soon.
He will soon announce tariffs on semiconductors and chips. Initial tariffs on pharmaceuticals will be low but could rise to 150-250% within a year.
Trump criticized Federal Reserve Chairman Powell as being very political and hinted at new candidates for Fed positions. However, US Treasury Secretary Scott Bessent wants to stay in his job.
After Trump’s comments, the US Dollar Index rose by 0.3% to 99.00. Tariffs are fees on imported goods that protect domestic industries by making local products cheaper.
Tariffs are different from regular taxes since they are paid at entry points. Some economists back tariffs to protect local businesses, while others warn they can raise prices and lead to trade wars.
Trump’s plan aims to strengthen the US economy by imposing tariffs on key trade partners like Mexico, China, and Canada. He hopes to use the revenue from these tariffs to lower personal income taxes.
Expect increased market fluctuations. The CBOE Volatility Index (VIX), which shows expected market turbulence, has been around 14.5, its lowest since 2025, indicating that options are relatively inexpensive. This could be a good time to buy protection or speculate on larger price swings in the upcoming weeks.
The US Dollar Index is strong and reached 99.00 following the news. With ongoing tariff discussions and pressure on the Fed, we expect this strength to remain against currencies like the Euro and Yen. Recent European data showing slowing industrial production adds to this outlook. We are considering long dollar positions using futures or call options on currency ETFs.
New semiconductor tariffs are likely to pressure that sector. The PHLX Semiconductor Index (SOX) has risen nearly 20% in 2025, making it susceptible to a drop due to news that could disturb supply chains. We are looking at buying put options on major chipmakers and related ETFs to prepare for a potential decline.
The proposed pharmaceutical tariffs are particularly aggressive, which could hurt company profits significantly. Looking back at trade disputes from the late 2010s, sectors targeted by tariffs tended to underperform for months. Buying put options on pharmaceutical ETFs is a smart way to protect against expected price drops.
A possible US-China trade deal contrasts with the new tariff threats against India. We see a trading opportunity here, preferring Chinese stocks over Indian stocks in the short term. This could be achieved by buying call options on China-focused ETFs while also buying puts on India-focused funds.
Any talk of replacing the Fed Chairman adds uncertainty around interest rates. The market is already reacting, with Fed Funds futures showing a greater chance of a rate cut before the year ends, up from just 15% a month ago. This indicates we should keep an eye out for chances in interest rate derivatives that may benefit from a more politically influenced Fed.
Jio’s financial services are back on track with Wave (5) after a correction of around 198.47 INR.
Jio Financial Services has started to rise again after hitting a low of 198.47 INR. This marked the end of a correction phase and the start of wave (5) in a larger Elliott Wave pattern, kicking off a bullish wave III.
Since reaching that low, the stock has gained significant momentum, creating a five-wave move in wave ((1)) of III. This recent wave began in April and includes an impulsive wave (1), a corrective wave (2), followed by a strong wave (3) and a small wave (4) pullback.
The latest breakout indicates that wave (5) of wave ((1)) is in progress. More gains are expected before we enter a larger wave ((2)) correction. A key level to watch is 198.47 INR; remaining above this level means any dips are corrective and could be good buying opportunities.
The current rally is part of a larger bullish cycle that began after the March low. It is wise to monitor wave (5), as minor pullbacks may provide good chances for long positions as wave III continues.
Jio Financial Services has resumed its uptrend, and we see this momentum as part of a bigger bullish cycle. The stock has been strong since the March 2025 lows, indicating a new primary rally. As of early August 2025, the price has climbed above 390 INR.
This upward move is backed by solid developments, including strong first-quarter earnings for fiscal year 2026 released last month. Assets under management (AUM) grew by 22% from the previous quarter, surpassing market expectations and boosting investor confidence. Overall market sentiment is positive, with the Nifty 50 remaining above 25,000 for several weeks.
In the coming weeks, buying call options on minor dips is a smart strategy. This approach allows traders to benefit from the anticipated push in the smaller wave pattern. Watch for shallow pullbacks to the 375-380 INR range as potential entry points for short-term call positions expiring in September 2025.
However, we should also be ready for the larger corrective wave ((2)), expected after this rally ends. As the stock approaches significant resistance near the 420-430 INR zone, consider taking profits on long positions. It’s wise to explore protective put options to guard against a potential sharp decline.
Since the critical support level of 198.47 INR is still well below the current price, selling out-of-the-money puts can generate extra income. A bull put spread, such as selling the 360 INR strike and buying the 350 INR strike for the September 2025 series, offers a defined-risk way to bet on the price staying above these levels. This strategy benefits from both the upward trend and time decay.
Keeping a close eye on price movements is essential as this wave nears its end. Look for signs of exhaustion, like lower volume on new highs, which could signal the start of a larger pullback. Historical data from other fast-growing financial firms in 2022 and 2023 shows that after rapid growth, corrections can happen quickly.
UBS expects the Federal Reserve to cut rates by 100 basis points by early 2026.
**UBS Predicts Rate Cut**
UBS sees potential opportunities even amidst policy and geopolitical challenges while waiting for uncertainties to clear. Their forecast comes after a recent jobs revision that raised expectations for a Federal Reserve interest rate cut.
Goldman Sachs also suggests a possible rate cut of up to 50 basis points in September, pending further job market weaknesses. This aligns with wider economic trends and strategic responses to current market situations.
The Federal Reserve may cut interest rates as soon as September, prompting us to consider interest rate derivatives that would profit from this shift. The latest jobs report has changed the outlook significantly, with the CME FedWatch Tool now indicating over a 70% chance of a cut at the next meeting. This emphasizes the need to prepare for lower rates in the upcoming weeks.
**Impact of Rate Cuts**
In the past, rate cuts that occurred without a recession have generally boosted stock prices. This makes bullish derivative strategies on major indices appealing. Looking back at the market rally that followed the Fed’s rate cuts in 2019 can offer insights into expected outcomes. Purchasing call options on the S&P 500 or Nasdaq 100 with expiration dates in late September or October could help capture potential gains.
This expected policy change could also weaken the US dollar, creating chances in forex derivatives. The US Dollar Index (DXY) has already dropped from its July peak of about 106.50, as traders begin to factor in the rate cut. We might consider long positions in currency pairs like EUR/USD or taking short positions against the dollar through futures contracts.
We must get ready for a rise in short-term volatility as the Fed’s decision approaches. The CBOE Volatility Index (VIX) has been relatively stable near 15, but it’s likely to rise as the September meeting nears. Buying options can help us take advantage of market gains while managing risk in this unpredictable environment.
Since today is August 5th, timing is crucial to avoid losing value from time decay on options. Focus on contracts that expire after the September Fed meeting to give our strategy adequate time to develop. This ensures we are set to benefit from the market’s advance once the rate cut is confirmed and the current uncertainties fade.
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US Services PMI shows slight expansion but indicates broad weakness, with tariffs significantly impacting trade.
The ISM non-manufacturing PMI in the US dropped to 50.1, slightly above the crucial 50 mark, showing only slight growth. Seven out of ten components declined, with imports and new export orders falling into contraction due to tariff issues.
Major US stock indices closed lower. The Dow Jones fell 0.14% to 44,111.74, the S&P dropped 0.49% to 6,299.19, and NASDAQ lost 0.65%, closing at 20,916.55. Crude oil futures ended at $65.16, while Citi forecasts gold to reach $3,500 per ounce within three months.
US Treasury Auction and Yield Movements
The US Treasury auctioned $58 billion in 3-year notes at a yield of 3.669%. Yields rose for 2-year notes to 3.724% and 5-year notes to 3.776%, while the 30-year yield fell to 4.777%. President Trump addressed several topics, labeling some survey data as outdated. He discussed employment numbers, trade tariffs, and foreign policy, asserting his impact on energy prices and international trade commitments. The USD had mixed results, with EUR/USD moving lower after discussions about potential EU tariffs. There were also conversations about possible actions from the Federal Reserve, including a potential rate cut by UBS in September. The ISM Services index is barely growing at 50.1, a sharp decline from earlier this year. This indicates that the U.S. economy’s main driver is struggling, posing risks to the stock market. Derivative traders might consider buying puts on the S&P 500 or Nasdaq as a hedge against a potential downturn in the coming weeks.Yield Curve and Market Sentiment
The yield curve is flattening, as 2-year yields rise while 30-year yields fall, indicating a market conflict. Traders are facing ongoing inflation concerns while anticipating a slowdown, similar to the volatile periods of 2023-2024. This situation makes options on interest rate futures appealing to capture volatility without choosing a clear direction. We must seriously consider renewed tariff threats, especially regarding a potential 15-20% minimum tariff on EU goods and rates up to 250% on pharmaceuticals. These are serious warnings that could disrupt supply chains still fragile from the pandemic. Protective puts on pharmaceutical ETFs (XPH) and semiconductor ETFs (SOXX) might be wise investments. The prediction of gold reaching $3,500 an ounce in three months is highly optimistic and reflects increasing economic and geopolitical uncertainty. Such a rise from current levels would be reminiscent of the sharp price comeback in 2020. Buying long-dated call options on gold futures or related ETFs like GLD could provide substantial gains if this forecast holds true. The US dollar is showing mixed results, but the euro appears vulnerable due to the imminent tariff threats against the EU. Shorting the EUR/USD pair through futures or options seems like a smart strategy against rising trade tensions. This currency pair has reacted sharply to trade news, experiencing significant declines during earlier tariff rounds in the 2018-2019 period. While the Atlanta Fed’s GDPNow estimate has increased, we should pay attention to the weakening forward-looking survey data. Business activity, new orders, and employment are all losing momentum, with feedback from respondents blaming tariffs for delays in projects. This trend indicates that weaknesses could spread, making bearish positions on cyclical sectors like industrials and materials more attractive. Create your live VT Markets account and start trading now.Elliott Wave analysis suggests that Dow futures are nearing a peak before a decline.
The Dow Futures cycle, which began its low in April 2025, is coming to an end. We may see a final surge to finish this impulsive cycle. The one-hour chart shows wave (3) reaching a peak of 45,312. It was followed by wave (4), which pulled back to 43,467 in a zigzag shape.
Currently, wave (5) is forming as a smaller impulse. It starts from wave (4), where wave ((i)) hit 43,864 and wave ((ii)) pulled back to 43,542. We expect more highs until wave 1 of (5) ends, followed by a possible wave 2 pullback. Staying above 43,467 should encourage buyers and support further gains.
