Silver (XAG/USD) fell to around $73.70 on Tuesday, down 3.50% on the day. The drop came as traders kept expectations for near-term Federal Reserve rate cuts low, even after softer US inflation data. US headline inflation eased to 2.4% year on year in January, down from 2.7% in December. Core CPI rose 2.5%, matching forecasts, after 2.6% previously.

Market Volatility Outlook

Volatility risk increased as US markets reopened after a long weekend. The next key event is the release of FOMC minutes from the January meeting on Wednesday. At that meeting, the Fed left rates unchanged at 3.50%–3.75%. Markets also watched talks between the US and Iran in Geneva, where Iran’s nuclear programme was expected to be discussed. On the daily chart, XAG/USD traded at $73.68. The 20-day EMA slipped to $83.30, while RSI (14) was 42.17 and below the midpoint. Price stayed below the 20-day EMA, which continued to limit near-term rebounds. A daily close above the EMA could reduce selling pressure. If not, the near-term bias remains lower.

Derivative Strategy Considerations

A year ago, silver was also under pressure near $73, as markets debated the Fed’s next move. In early 2025, rates sat at 3.50%–3.75%, and traders expected more cuts than actually happened. Now, with rates still firm at 3.75%–4.00% and silver closer to $68, conditions remain tough for non-yielding assets. Inflation remains the main driver, just as it was then. The drop in headline inflation to 2.4% in January 2025 did not lead to the sharp dovish shift some traders expected. More recent January 2026 data showed inflation staying sticky at 2.8%. That supports the Fed’s cautious approach and continues to pressure silver. For derivatives traders, this points to strategies that benefit from range trading or further weakness. One approach is selling call options above key technical resistance near $70 to earn premium, since higher rates can limit strong rallies. In 2025, implied volatility in silver options often rose ahead of FOMC meetings, and that pattern may return. The technical setup also looks similar to last year’s weakness. Price is still struggling below its 20-day moving average, now acting as resistance near $70. That supports a short-term bearish trend. The RSI is near 38, showing downside momentum, with room to fall before the market looks oversold. While the specific US-Iran talks from 2025 have passed, broader geopolitical risk can still trigger brief, sharp rallies. Over the longer term, strong industrial demand may help support prices. In 2025, industrial use hit a record, with more than 630 million ounces consumed for solar and electronics. This physical demand is an important risk for traders holding only short positions. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now

Amazon (AMZN) has resumed its decline after a corrective bounce. The rebound formed a three-swing recovery in wave 4, following an earlier three-wave drop from the 247.77 peak. The wave 4 bounce stayed corrective and did not change the downtrend. After wave 4 ended, price turned lower and began a new impulsive move. The decline is now in wave 5 and is unfolding as a five-wave structure. This supports the idea that the broader down sequence is still in place. The current leg down is projected to reach the 1.236 external retracement of wave 4 near 192.96. If the selloff extends, a further target sits near 187.17. Any rallies are expected to be corrective and to stay below the wave 4 pivot. The short-term trend remains bearish as wave 5 continues. Since Amazon appears to have finished its corrective bounce and is turning lower, consider strategies that benefit from a falling stock price. Buying puts or using bear call spreads are two ways to position for a continued move down. Any short-term strength may be better viewed as a selling opportunity, not a shift in the main trend. This bearish technical view is also backed by recent economic data. The U.S. Census Bureau’s January 2026 report showed an unexpected 0.8% drop in retail sales. This suggests the consumer may be weakening after a strong 2025. That softness can pressure Amazon’s core e-commerce business and adds fundamental support to the technical downside case. Options data also reflects this negative tone. AMZN’s 30-day put/call ratio has risen to 1.25, the highest since the October 2025 sell-off. This suggests more traders are betting on, or hedging against, further downside and aligns with the expectation that the decline may continue. Concerns are also building in cloud computing, a major profit engine for Amazon. Industry analysis for Q4 2025 showed competitors such as Microsoft Azure gaining market share, which may weigh on AWS growth. This headwind could limit buying interest in the stock. With this setup, a test of 192.96 looks likely in the coming weeks. If selling pressure increases—especially with weak consumer data—the next level to watch is 187.17. The high of the wave 4 bounce is a clear invalidation point for bearish positions.

here to set up a live account on VT Markets now

Oil prices have climbed as US–Iran nuclear talks continue and Iran holds military exercises. Markets are pricing in the risk of escalation. Even after a recent dip, oil is still about 10% higher than at the start of the year. OPEC+ is weighing whether to restart production increases from April, as demand is expected to improve in the second quarter. Eight member countries will decide at a meeting on 1 March.

Opec Supply Limits

Even if OPEC+ raises targets, real output may rise by less than the headline numbers. Structural limits, outages, and sanctions-related disruptions can hold production back. An S&P Global Energy (Platts) survey found that in January, OPEC+ nations with targets produced only 1.6 million barrels per day more than in March 2025, before the expansion started. Russian exports are another constraint. Production could fall if Russia cannot find new buyers to replace weaker demand from India. Kpler data shows India is expected to import 1.16 million barrels per day of Russian oil in February, with volumes likely to drop in the months ahead. Geopolitical risk—especially around Iran—continues to support prices because supply disruptions remain possible. This uncertainty can make call options a practical way to prepare for sudden price spikes in the coming weeks. Tensions are helping create a price floor that the market cannot easily ignore. All eyes are on the OPEC+ meeting on March 1, when the group will decide whether to raise April production targets. Still, much of 2025 showed a clear pattern: actual output often missed stated quotas. That history suggests any announced increase may not fully turn into additional barrels in the market.

Quota Compliance Gap

The gap between quotas and real production remains a key structural support for prices. Industry data for January 2026 shows participating OPEC+ countries underproduced their combined targets by almost 1.8 million barrels per day (bpd). Ongoing capacity limits and operational issues reduce the group’s ability to ease the market. Russia also faces growing pressure. Its ability to redirect barrels—especially those previously sold to India—is uncertain. While February imports by India were first projected at 1.16 million bpd, recent tanker tracking points to a sharp drop in loadings in the second half of the month. Flows now look closer to 850,000 bpd. That raises the risk Russia may be forced to cut production, tightening global supply further. Together, these supply limits make a sharp price drop less likely in the near term. For derivatives traders, this favors strategies that assume a steady or rising price floor. Selling put options to collect premium—based on the view that prices will not fall below a set level—may be a workable approach. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now

Austan Goolsbee, President of the Federal Reserve Bank of Chicago, said in a CNBC interview on Tuesday that services inflation is “not tame.” He also said there could be several more rate cuts in 2026. He said the recent drop in headline inflation was partly due to base effects. He also said goods with higher tariff content have generally seen bigger price increases.

Policy Rate Outlook

Goolsbee said a 3% policy rate is a “loose” estimate of neutral. He said he wants to see clear evidence that inflation is moving back to 2% before rates continue to fall. He said he has known chair nominee Warsh for a long time. He added that he is a “big fan” of Warsh, based on their work together during the Great Financial Crisis. We think the Fed is signaling it wants more rate cuts this year. But the key message is the warning that services inflation is still not tame. The latest January 2026 CPI report backed this up, with core services inflation still high at 4.1% year over year. This means any path to the “several cuts” he mentioned depends on that number falling a lot. This puts major focus on the next inflation report for interest rate derivative trades. Traders may consider buying options on 3 Month SOFR futures to prepare for a large move without choosing a clear direction. If inflation comes in cooler than expected, these futures could rally as markets price in the cuts Goolsbee hinted at.

Market Volatility Signals

In equity markets, this points to a higher chance of volatility around upcoming data releases. With the VIX index currently near a low 14, buying VIX calls ahead of the next CPI or employment report could be a sensible hedge. A surprise in the data could quickly move markets and push volatility higher. It is also worth remembering what happened in 2025, when the Fed began cutting rates but then paused after inflation rose again in the third quarter. That false start showed how fast the policy outlook can change. This history suggests long-term dovish bets are risky until the data shows a steady downward trend. For currency traders, this creates a difficult setup for the US dollar. The chance of several more cuts is negative for the dollar, but sticky inflation offers some support. This could keep major pairs like EUR USD trading in a range until the Fed’s path is clearer. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now

Sweden’s seasonally adjusted unemployment rate fell to 8.0%, versus a consensus forecast of 8.8%. Employment was unchanged and remains at a high level. The December and January results suggest that both the unemployment and employment rates could be revised in a positive direction. This lowers the chance of a Riksbank rate cut in the first half of the year.

Labor Market Signals And Rate Cut Odds

In February, Sweden’s inflation expectations declined, with the biggest drop in the one-year outlook. The one-year figure fell to 1.4% from 1.5% in January. The report says it was created with help from an artificial intelligence tool and reviewed by an editor. We saw a similar setup in early 2025: a stronger-than-expected labor market alongside low inflation. At the time, unemployment falling to 8.0% was an early sign that the Riksbank would not rush to cut rates. Markets were pricing in cuts, but the economy looked strong enough to justify a more hawkish stance. That pattern has largely continued into February 2026. The labor market remains a key support for Sweden’s economy. The latest data from Statistics Sweden shows unemployment steady at a solid 7.8% in January 2026, which is strong by historical standards. A tight labor market gives the Riksbank a clear reason to keep policy unchanged.

Trading Implications For The Swedish Krona

Inflation has also moved higher. The CPIF inflation rate has rebounded, and the January 2026 reading came in at 2.1%, slightly above the Riksbank’s 2% target. This supports the Riksbank’s choice to hold its policy rate at 3.75% through late 2025 and into this year. Against this backdrop, SEK volatility may be priced too low, especially versus currencies like the euro, where the ECB is sounding more dovish. Options that position for continued SEK strength may offer value. The rate gap between the Riksbank and the ECB should support the krona in the near term. As a result, traders may consider buying SEK call options versus the euro, aiming for a further decline in EUR/SEK from around 10.95. Another approach is to sell out-of-the-money EUR/SEK call options to collect premium, based on the view that a firm Riksbank stance will limit any sharp rise in the pair. The goal is to build trades that benefit from the Riksbank having little reason to cut rates before other major central banks. The main risk in the coming weeks is the March inflation release and forward-looking business sentiment surveys. Any surprise slowdown in the economy or a sharp drop in inflation could push the Riksbank to soften its hawkish tone. That could quickly reverse trades built around SEK strength. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now

Since December 2021, SPY and QQQ have shown a repeating weekly pattern: strong uptrend “expansion” legs followed by “reset” pullbacks. Many of these moves have traveled similar distances. That has created a fairly symmetrical framework around prior measured-move levels. Both ETFs are again near the top of this long-running structure. This area often becomes a decision zone. Price may either hold above prior highs, or fail and rotate back into the earlier range.

How SPY And QQQ Differ In This Structure

SPY and QQQ share the same overall structure, but they often act differently. SPY usually moves in a steadier way with the broader market. QQQ often rallies farther, but it can also show weakness sooner when the structure starts to break. Near the top of a measured move, markets often compress instead of reversing right away. This can look like several tests of the highs followed by pullbacks. Because of that, weekly closes and follow-through matter more than intraday moves. Two outcomes matter most: Acceptance would look like strong weekly closes near the highs, shallow pullbacks, and more time trading above the prior ceiling. Rejection would look like weak weekly closes after pushes higher, a lower high on the weekly chart, and more time back inside the prior range. In the past, “reset” phases in this structure have pulled back in the high-teens to low-twenties percent range.

Risk Management At A Long Running Ceiling

With price pressing against a ceiling that has held since late 2021, the priority shifts from chasing momentum to managing risk at a key decision point. We have seen this pattern before. After the large reset that dominated 2022, the expansion through 2024 and 2025 has brought price back to the upper boundary. The next few weeks are about watching for confirmation of the next major move, not predicting it. QQQ is the best early warning signal. Both ETFs are stretched, but QQQ’s higher beta means it may show stress first if this structure begins to fail. Recent earnings from major tech names have been strong, but guidance has been more cautious. If QQQ cannot hold new highs on the weekly chart, that could be an important warning sign. Options markets are also starting to show more caution. The CBOE put/call ratio has climbed to 0.95. That is a meaningful rise from late 2025, when it stayed below 0.80 and signaled extreme complacency. This change suggests traders are starting to buy more downside protection. For derivative traders, this is a time to stay patient and flexible. If weekly closes cannot hold the highs and candles show long upper wicks, it may make sense to start building positions that benefit from a rotation lower. One defined-risk approach is longer-dated put debit spreads on QQQ, which can target a potential reset back into the established range. If the market instead shows acceptance with strong weekly closes above prior highs, that would support the start of a new leg higher. In that case, call debit spreads on SPY can be a prudent way to participate. This keeps upside exposure while limiting risk if the breakout fails. Time is the key variable. The market could spend weeks compressing at this level before choosing direction. That makes short-dated options riskier because time decay accelerates. Options with at least 60 to 90 days to expiration are often better suited to handle sideways movement before the trend resumes or reverses. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now

AUD/USD traded near 0.7050 on Tuesday, down 0.40%, after the Reserve Bank of Australia (RBA) released minutes from its February meeting. The Australian Dollar fell because the minutes did not set a clear path for interest rates. The minutes said policymakers would raise rates if needed to prevent inflation from staying above target for too long. They added that price pressures could remain high for an extended period without tighter policy.

Rba Minutes Leave Markets Unsure

The minutes did not signal where rates might go next and said decisions will depend on incoming data. This offered limited support for the Australian Dollar and kept markets cautious about further tightening. Focus has now shifted to Australia’s employment data due later this week. BBH said labour market trends will shape rate expectations. Strong job creation could point to further increases over the next twelve months, while weaker results could add pressure on the currency. In the United States, the US Dollar traded without a clear direction, with thin volumes after a long weekend. Markets are waiting for the FOMC minutes and the preliminary fourth-quarter GDP estimate, which could influence expectations for future Federal Reserve policy. At this time last year, in February 2025, the RBA was raising rates but gave little clarity about its next move. This uncertainty kept AUD/USD hovering around 0.7050. Today, the picture looks different, with the pair trading closer to 0.6550 as the RBA appears to be leaning toward easing policy later this year.

Outlook Shifts As Policy Diverges

The RBA’s shift makes sense as inflation has cooled to 3.1% year over year, well below the peaks seen through 2025. The labour market is also showing signs of easing, with the national unemployment rate recently rising to 4.2%. This suggests earlier rate hikes are flowing through the economy, reducing the need for tight policy. On the other side, the US Dollar is supported by a Federal Reserve that has kept rates steady, unlike early 2025 when the path forward was also unclear. While US inflation has eased to 2.8%, slower GDP growth of 1.5% in the final quarter of 2025 creates a more mixed outlook for the Fed. Even so, the relative firmness in US rate policy continues to support the dollar against the Aussie. In the weeks ahead, this policy gap suggests the Aussie could weaken further against the greenback. Traders may prefer strategies that benefit from a decline, such as buying put options on AUD/USD. This offers exposure to downside moves while limiting risk to the premium paid. Markets will be watching upcoming CPI data from both countries, as surprises could change the outlook. A stronger-than-expected inflation print in Australia could force the RBA to dial back its dovish tone, creating short-term volatility. Traders should stay flexible and monitor key data releases closely. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now

TD Securities expects US PCE inflation to strengthen in December. It forecasts core PCE at 0.25% month on month and headline PCE at 0.27%. That would put core PCE at 2.9% year on year and headline PCE at 2.8%. The firm expects supercore PCE at 0.26% month on month. It says food prices should help lift the headline reading. It also notes that January CPI was softer than expected, especially in services. It adds that some CPI strength is unlikely to show up in its PCE forecast.

Tariffs And Near Term Inflation

TD Securities expects higher tariffs to lift consumer prices in the near term. It forecasts core CPI inflation to peak near 2.8% year on year in Q2 2026, with core PCE reaching similar levels. It expects inflation to stay stubborn in the first half of 2026, then cool in the second half as disinflation resumes. This article was produced using an AI tool and reviewed by an editor, and it was published by the FXStreet Insights Team. The inflation outlook for the first half of the year looks more persistent than many expected. We saw this in the firm December 2025 Personal Consumption Expenditures (PCE) report and in January CPI. January CPI was not as hot as feared, but it still suggests ongoing price pressure. That makes it harder to argue that the Federal Reserve can start cutting rates soon. Much higher tariffs, driven by new trade policies taking effect this quarter, are now a key reason prices could rise. As a result, we expect core inflation measures to move higher and peak in the second quarter. We now project core CPI to reach a cycle high near 2.8% year over year by late spring.

Market Implications For Rates

This argues for interest-rate positions that reflect a more patient Fed. The market is starting to remove the chance of a rate cut in the first half of 2026, which is a big change from a few weeks ago. Based on the CME FedWatch Tool, the odds of a rate cut by June are now below 25%, down from over 50% at the start of the year. This gap between a hawkish Fed and hopes for falling inflation could increase volatility. With uncertainty around the real impact of tariffs and whether services inflation will stay sticky, options may help as a hedge. We are considering positions such as VIX call options or straddles on major indices to protect against a potential market drop. This setup is similar to 2022, when early signs of cooling inflation were followed by repeated upside surprises. That period showed that the last stage of disinflation can be the hardest. The Fed had to stay aggressive then, and we see a similar risk today if the market moves too far ahead of the data. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now

Canada’s CPI rose 2.3% year on year in January. That was down from 2.4% in December and below the 2.4% forecast. Prices were flat month on month. The Bank of Canada core CPI rose 2.6% year on year and 0.2% month on month. Other BoC measures were 2.7% for Common (from 2.8%), 2.4% for Trimmed (from 2.7%), and 2.5% for Median (from 2.6%). Statistics Canada said gasoline was the main reason the headline rate slowed. It also said the temporary GST/HST break in January 2025 continued to affect year-on-year comparisons in January 2026. Restaurant meals were hit most. Alcoholic drinks, toys, and children’s clothing were also affected. After the release, USD/CAD traded around 1.3650–1.3660. Earlier preview material pointed to a 13:30 GMT release time and a March 18 BoC meeting. Rates were expected to stay at 2.25%. The preview also listed technical levels: 1.3724, 1.3760, 1.3820, 1.3870, and 1.3928. Support was at 1.3481 and 1.3418. It also put RSI near 45 and ADX near 28. With inflation at 2.3% in January, a bit cooler than the 2.4% expected, near-term pressure on the Bank of Canada has eased. That gives the Bank more room going into the March 18 meeting and supports the view that it will hold rates at 2.25%. For traders, this lowers the risk of a hawkish surprise and leans toward a weaker Canadian Dollar. The data favors selling short-term CAD strength, or buying dips in USD/CAD. Headline inflation is lower, but core inflation is still sticky and well above the 2% target. That makes it hard for the Bank to hint at near-term rate cuts. This mix supports a slow move higher in USD/CAD rather than a fast breakout. It can also support strategies like selling out-of-the-money CAD call options. Recent data shows a clearer gap between the Canadian and U.S. economies. Last week’s U.S. jobs report stayed strong, with more than 200,000 jobs added. Canada’s early-February jobs data showed unemployment edging up to 6.2%. This policy gap matters: the U.S. Federal Reserve looks set to stay on hold, while the Bank of Canada could tilt more dovish. That can support USD/CAD in the weeks ahead. In the past—especially during the 2022 commodity surge—oil spikes gave the CAD a big lift. But Western Canadian Select is now steady around $65–$70 per barrel, so that tailwind is missing. Without strong support from oil, the CAD is more sensitive to rate differentials, which currently favor the U.S. Dollar. With USD/CAD still biased higher, traders may want strategies that benefit from a controlled rise. One approach is buying USD/CAD call spreads, for example targeting the 1.3724 February high. This keeps risk defined while positioning for further upside. It also fits a market that is continuing to price out the chance of a BoC rate hike, while still allowing for sudden pullbacks. The mix of cooler headline inflation and firm core inflation will likely keep volatility elevated around key data. That also raises the chance that options implied volatility is too low ahead of the next BoC meeting. If traders think the market is underpricing the risk of a bigger move, they could consider buying straddles or strangles, even without a strong view on direction.

here to set up a live account on VT Markets now

ING said the Reserve Bank of New Zealand’s November 2025 projections underestimated inflation after new CPI data came in above its forecasts. Fourth‑quarter CPI was 3.1% year on year versus the RBNZ’s 2.7% estimate, while non‑tradable CPI was 3.5% versus 3.2%. ING expects the RBNZ to leave rates unchanged at its February meeting. The focus will be on the bank’s guidance and updated projections. The November track pointed to a first rate rise in 2Q27, based on headline inflation falling to 2.2% in the second half of 2026.

Inflation Proving More Persistent

ING estimates inflation will not drop below 2.4% at any point this year. It expects a first‑quarter reading of about 2.7% to 2.8%. That compares with the RBNZ’s 2.3% estimate for 1Q. ING forecasts two rate rises in 2026, taking the policy rate to 2.75%, starting in September or October. It also expects one more rise in 2027 to bring the rate back to a neutral level of 3.0%. The Reserve Bank of New Zealand’s November 2025 projections now look too optimistic about how fast inflation would cool. Fourth‑quarter inflation was stronger than expected. This raises doubts about whether last year’s sharp rate cuts went too far. Sticky inflation also weakens the view that the easing cycle was timed perfectly. Recent data also points to a stronger economy than expected. The January jobs report showed unemployment falling to 3.8%. The latest Quarterly Employment Survey showed private‑sector wage growth is still solid. Together, these figures suggest price pressures are easing more slowly than the RBNZ expected in 2025.

Market Pricing And Policy Outlook

We do not expect a rate change at this month’s meeting. Instead, markets will focus on the RBNZ’s new projections and what they imply for future policy. With inflation staying high, the old plan for a first rate hike in mid‑2027 looks too late. Investors will look for signs the RBNZ may move this timeline forward. We expect inflation to remain sticky and stay above 2.4% all year. That is well above the RBNZ’s earlier forecasts. If inflation stays this firm, the central bank may need to respond. We expect two hikes in 2026, lifting the policy rate to 2.75%, likely starting in September or October. That would mean part of the 2025 easing cycle gets reversed. For derivative traders, the market may still be pricing in too little tightening from the RBNZ. Overnight index swaps are not fully pricing two hikes in 2026. That could create opportunities to position for higher short‑term rates. A sharp repricing may happen once the RBNZ updates its guidance in the coming weeks. Further out, we think the tightening cycle may continue. We expect another hike in 2027, bringing the policy rate back to a neutral 3.0%. The return to price stability may take longer, and it may require higher rates, than markets expected only a few months ago. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now