GBP/USD rose during Wednesday’s North American session but fell back from 1.3712 after the US Nonfarm Payrolls (NFP) report. The pair was near 1.3655, up 0.10%. January payrolls increased by 130K versus a 70K forecast. December was revised down to 48K from 50K. The unemployment rate fell to 4.3% from 4.4%. The University of Michigan survey also showed households are more worried about job prospects.

Fed Pricing Shifts After Jobs Data

The BLS said job gains in the 12 months through March 2025 were lower than previously estimated. After the data, money markets reduced the odds of a Fed cut in June 2026 from 100% to 68%. Markets also priced a 95% chance of no change in March, according to Prime Market Terminal. In the UK, unrest within the Labour Party has increased pressure on Prime Minister Keir Starmer, who rejected calls to resign. The Bank of England’s 5–4 vote to hold rates steady also raised expectations of a rate cut in March. Markets are watching UK GDP on Thursday, with forecasts pointing to slower Q4 growth, and US CPI on Friday. From a technical view, GBP/USD traded around 1.3664. Support sits near the 50-day SMA around 1.3500, while resistance is near 1.3700. This stronger-than-expected US jobs report changes our near-term view of Federal Reserve policy. We saw something similar in early 2024, when a surprise NFP gain of +353K forced markets to delay expected rate cuts. As a result, we are reducing exposure to long GBP/USD positions ahead of Friday’s key US inflation report.

Strategy Ideas Into Key Data

We now see a clear policy gap. The Bank of England is signaling possible rate cuts as soon as March after last week’s close 5–4 hold vote. Political pressure on the Prime Minister adds to pound weakness, as it often increases volatility and weighs on the currency. This widening gap between the Fed and BoE outlooks supports a bearish view on the pound. With major data this week (UK GDP and US CPI), volatility could rise sharply. Buying GBP/USD put options is a direct way to position for a move lower, especially if US inflation is hotter than expected. A daily close below the 50-day moving average near 1.3500 would be our signal to add to these bearish positions. If you are less sure about direction but expect a big move, option straddles or strangles may fit better. These approaches can profit from a large move either way after the data. They focus on benefiting from the volatility spike itself, whether the bigger surprise comes from UK growth or US inflation. Create your live VT Markets account and start trading now.

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USD/JPY traded near 153.30 on Thursday, down 0.70% on the day. The pair rose briefly after the US jobs report, but then fell again as the Japanese Yen strengthened. US Nonfarm Payrolls rose by 130,000 in January versus 70,000 expected, after a downward revision that left December at a 48,000 gain. The unemployment rate eased to 4.3% from 4.4%. The participation rate rose to 62.5%. Average hourly earnings increased 0.4% m/m and held at 3.7% y/y, versus 3.6% expected.

Fed Policy Outlook

The report supports the Fed keeping rates in the 3.50%–3.75% range. CME FedWatch shows markets are almost fully pricing in a pause in March and April. Markets also focused on the revisions. These included an 898,000 reduction to the March 2025 employment level and a cut to total 2025 job growth to 181,000 from 584,000. These changes weakened support for the US Dollar. The Yen strengthened after Prime Minister Sanae Takaichi won Sunday’s election. Markets think this result supports pro-growth policies and allows a gradual shift in BoJ policy. Medium-term tightening expectations are also supporting the Yen. Last week’s headline jobs number now looks misleading. The key takeaway is the large 898,000 downward revision to the 2025 employment level, which suggests a much weaker US economy. This shift may limit how long the Federal Reserve can keep a hawkish tone in the months ahead.

Positioning And Market Implications

This view is reinforced by yesterday morning’s US Consumer Price Index (CPI) report. Core inflation fell to 2.8% year-over-year, below expectations of 3.0%. This supports the idea that the Fed will stay on hold. Fed funds futures now imply a 40% chance of a rate cut by July. With both jobs and inflation showing weaker underlying trends, it is harder to be bullish on the US Dollar. On the other side, the Japanese Yen is gaining momentum after Prime Minister Takaichi’s clear election win. Comments this week from the new Finance Minister, pointing to a desire to “normalize policy,” are adding to speculation that the Bank of Japan could end negative rates as soon as its April meeting. Short JPY positions are being reduced quickly, similar to the sharp yen rally seen in mid-2025. With this policy gap in mind, the bias is for further downside in USD/JPY, with a potential move toward the 150.00 psychological level. Buying March and April put options offers a defined-risk way to express this view. One-month implied volatility has risen to 12.5%, suggesting the market is also preparing for a large move, so putting positions on sooner may be preferable. Create your live VT Markets account and start trading now.

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Chefs’ Warehouse (CHEF) reported Q4 adjusted earnings of **$0.68 per share**, beating the **$0.62** consensus estimate and rising from **$0.55** a year ago. That equals an **earnings surprise of +9.68%**. In the prior quarter, earnings of **$0.50** topped the **$0.43** estimate, a **+16.28%** surprise. Quarterly revenue was **$1.14 billion** for the period ended **December 2025**. That beat forecasts by **4.38%** and increased from **$1.03 billion** a year earlier. Over the past four quarters, the company beat consensus **EPS and revenue** estimates **four times each**. CHEF shares are up about **4.9%** year to date, versus a **1.4%** gain for the S&P 500. Going into the release, the company faced an **unfavorable estimate revision trend** and holds a **Zacks Rank #4 (Sell)**. Consensus estimates call for **$0.30 EPS** on **$1.02 billion** in revenue next quarter, and **$2.22 EPS** on **$4.39 billion** in revenue for the current fiscal year. The **Food – Miscellaneous** industry ranks in the bottom **23%** of more than 250 Zacks industries. Historically, the top 50% of industries have outperformed the bottom 50% by more than **2-to-1**. **Flowers Foods (FLO)** reports on **12 February**, with estimates of **$0.16 EPS** (down **27.3%** year over year) on **$1.23 billion** of revenue (up **10.9%**). We are seeing a positive early reaction to Chefs’ Warehouse beating both earnings and revenue expectations for Q4 2025. The stock is indicated to open higher, adding to its recent outperformance versus the S&P 500. This strong report contrasts with the negative analyst sentiment seen before the release. Implied volatility was elevated into the announcement, with 30-day IV reaching **45%**, well above its 52-week average of **35%**. Now that earnings have been released, some of that premium may fade in a typical post-earnings **IV crush**. In this setup, selling options—such as **covered calls** or **cash-secured puts**—may appeal to investors who expect the stock to stabilize. The bearish sentiment reflects broader industry pressure, as the Food – Miscellaneous sector has been underperforming. Recent National Restaurant Association data showed a **0.5%** drop in traffic for **January 2026**, which may signal softer discretionary spending. Because of this, management’s guidance on the earnings call will be important for clues about demand trends in Q1. The next key watch item is how analysts adjust their estimates over the coming week. Those changes could either support or challenge the current **Sell** rating. One potential options approach is to use short-dated spreads to limit risk while positioning for a slow move higher if estimates rise. On the other hand, if management’s outlook is cautious, **puts** may look more attractive as the market reassesses the company’s strong 2025 performance.

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The Australian dollar traded above 0.71, the highest level since February 2023. Markets priced roughly a 70% chance of another 25 bp Reserve Bank of Australia (RBA) rate hike in May. RBA Deputy Governor Andrew Hauser said inflation is still too high and policymakers are готов to act to bring it down. He also said the central bank should not comment on government spending choices, and that public and private demand should be weighed the same when judging inflation risks.

Rba Signals Inflation Focus

Hauser said the RBA lifted rates in February because global growth was stronger than expected, financial conditions were not as tight as assumed, and private demand rose faster than supply. He added that keeping the economy close to balance may have made Australia more sensitive to demand shocks. As price pressures return, this has renewed concerns about inflation risk. Housing finance data showed first-home-buyer loan commitments rose 6.8% quarter-on-quarter to 31,783 in the December quarter. This was the biggest increase since the same quarter in 2023, and commitments were up 9.1% year-on-year. The value of first-home-buyer loans climbed 15.5% quarter-on-quarter. The average first-home-buyer loan size rose 8.5% to a record $607,624, mainly due to New South Wales. A familiar pattern is starting to return, similar to early 2025. Back then, the RBA surprised markets with a more hawkish tone, which pushed the Aussie dollar higher as inflation stayed persistent. That period also saw a jump in housing loan commitments, showing strong domestic demand.

Markets Reprice Rate Path

This dynamic matters again because January 2026 CPI printed at 3.8%. That is still above the RBA’s target and higher than markets expected. As in the prior year, stubborn inflation is keeping policymakers hawkish even after multiple rate hikes in 2025. Ongoing strength in the domestic economy—especially in services—appears to be continuing to fuel inflation. Markets are adjusting. Overnight index swaps now imply a 45% chance of another RBA hike in March, up from about 20% two weeks ago. This shift suggests some traders who expected rate cuts this year are being forced to rethink. For derivatives traders, that may support the case for long Australian dollar exposure. With this backdrop, buying AUD/USD call options expiring in late March or April could be a sensible way to position for a hawkish RBA surprise. Implied volatility has risen to a three-month high of 9.2%, showing higher uncertainty and the potential for sharper moves. That setting tends to suit option strategies that benefit from both direction and rising volatility. The housing market is also adding to inflation pressure, much like it did in late 2024 and early 2025. January 2026 data showed national home prices up 0.6% month-over-month, holding firm despite higher rates. This resilience suggests household balance sheets remain strong, giving the RBA less reason to pause its inflation fight. This differs from the United States, where inflation has moved more steadily toward the Federal Reserve’s 2% goal. This policy gap—an RBA that stays hawkish while the Fed remains on hold—supports AUD/USD at a fundamental level. One sign is the widening yield spread between Australian and U.S. 2-year government bonds, which has shifted 15 basis points in the Aussie’s favor this month. Create your live VT Markets account and start trading now.

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Gold traded near $5,070 on Wednesday. It had earlier slipped to $5,018 after strong US jobs data, but it stayed above the key $5,000 level. January Nonfarm Payrolls rose by 130K versus about 70K expected, and December was revised to 48K. The Unemployment Rate ticked down to 4.3% from 4.4%. Average Hourly Earnings rose 0.4% month-on-month versus 0.3% expected, and held at 3.7% year-on-year versus 3.6% expected.

Fed Rate Cut Expectations And Dollar Rebound

Markets still price in about two Federal Reserve rate cuts this year. CME FedWatch shows a 49% chance the first cut comes in June. The US Dollar Index rebounded above 97.00 after dipping to around 96.49. Other recent data was mixed. Retail Sales were flat at 0.0% in December versus 0.4% expected. JOLTS job openings fell to 6.542 million, the lowest since 2020. Fed comments also leaned cautious: policy may stay on hold, inflation needs to return to 2%, and the labour market may need to cool more before further cuts. On the charts, price sat below the upper Bollinger Band at $5,117.43. RSI was 61 and ADX was 10.56. Key support levels were $5,019.75 and the $5,019.75–$4,922.06 zone. Gold holding above $5,000 sends a mixed message. The strong jobs report weakens the case for near-term Fed cuts. That creates a standoff, making large one-way bets especially risky in the short term. The technical picture also points to a “coiling” phase that often comes before a big move. Narrowing Bollinger Bands suggest volatility is shrinking, which can set up a breakout in either direction. Because of that, the better approach may be to trade volatility, not the direction.

Central Bank Demand And Structural Support

This view is backed by steady long-term demand. Central banks continued their heavy buying through 2025, adding more than 1,000 tonnes for the third year in a row, according to the World Gold Council. This ongoing official demand helps support prices and reduces the risk of a deep sell-off. Geopolitical and economic risks also remain. These risks helped push gold from below $2,000 in 2023 to current levels. Many investors still use gold to hedge against inflation and instability. That underlying demand means long-term buyers may treat dips as opportunities. With FedWatch showing close to a 50/50 chance of a June cut, implied options volatility has not become overly expensive. This can make strategies like straddles or strangles attractive, since they can profit from a large move in either direction. Positioning for a major swing may still be reasonably priced before a clear catalyst appears. The next inflation report is the main event to watch because it could end the current stalemate. If inflation comes in hot, the Fed may stay on hold longer and gold could retest $5,000 support. If inflation is soft, June cut odds could rise and help drive a stronger move higher. Create your live VT Markets account and start trading now.

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The Pound pulled back from weekly highs above 1.3700 and slipped to around 1.3680 on Wednesday. A softer US Dollar, after weak US data on Tuesday, helped limit the decline. At the same time, UK political uncertainty continued to weigh on Sterling. Markets remain cautious ahead of the delayed US Nonfarm Payrolls report, due later on Wednesday. Forecasts suggest 70K jobs were added in January, up from 50K in December. Unemployment is expected at 4.4%, while annual wage growth is seen at 3.6%, down from 3.8%.

Technical Picture For Gbp Usd

GBP/USD recovered part of its losses and traded near 1.3680 during European hours. The daily chart shows the pair still moving inside an ascending channel. The 14-day RSI is 55.94, which is above 50. The nine-day EMA is above the 50-day EMA, with the 50-day EMA at 1.3518. The pair also remains above both averages. The Pound has retraced some recent losses against the US Dollar, but it is still struggling to break clearly above 1.2900. The current pause around 1.2850 appears linked to a slightly better UK economic backdrop, which is being offset by the Federal Reserve’s firm stance on interest rates. This looks similar to the uncertainty seen in early 2025, when rate decisions were also unclear. Derivative traders should stay cautious ahead of the US Nonfarm Payrolls release. Recent surveys from major financial news outlets put expectations at around 95,000 net new jobs, with unemployment holding at 3.9%. A weaker-than-expected result could pressure the Dollar and support the Pound.

Options Strategy And Key Support

Given this setup, buying near-term GBP/USD call options may be a sensible strategy for the coming weeks. For example, calls with a 1.2950 strike would offer upside exposure if the US jobs data is weaker than expected. This also helps limit downside risk if the Dollar strengthens unexpectedly. The pair is still above its 50-day moving average, now near 1.2780, which suggests the medium-term trend remains positive. This level is similar to the support that held through the second half of 2025, before a strong rally. As long as price stays above it, a bullish bias makes sense. Create your live VT Markets account and start trading now.

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ING expects the Riksbank to keep interest rates unchanged through 2026, even if inflation dips to around 1%. It ties this view to stronger growth and earlier policy easing, which reduce the need for further cuts. CPIF inflation is forecast to fall to a low of 1.0% in 3Q26, mainly due to VAT cuts. ING also expects inflation to move back toward 2.0% in 2027.

Market Pricing And Rate Cut Expectations

Softer recent inflation data and a dovish comment from Per Jansson have revived speculation about another cut. Markets are pricing about 15bp of easing by June. ING expects this to be priced out again, which could support the Swedish krona. Even if policy stays steady, Swedish yields below 2% keep the krona near the bottom of the G10 carry range. From 2015 to 2017, EUR-SEK two-year swap spreads were often similar to, or wider than, today’s levels, while EUR/SEK mostly traded between 9.00 and 10.00. ING expects the Riksbank to hold rates throughout 2026. This steady policy stance should support the krona. Sweden’s GDP grew 0.5% in the last quarter of 2025, beating expectations and giving the central bank little reason to cut rates further. That should make traders rethink bets on more easing. Inflation may briefly drop to 1% later this year, but this is largely driven by tax changes and is already on the Riksbank’s radar. More recent data, such as January’s CPIF reading of 1.9%, suggests underlying price pressure remains. This supports Governor Thedéen’s neutral message and implies the bank will look past any short-term weakness.

Implications For Sek Positioning

The main near-term opportunity is that markets are still pricing in roughly 15bp of cuts by June, which ING expects will not happen. Derivatives traders may want to position for this pricing to unwind. If it does, short-term Swedish rates should rise and the SEK may strengthen. One way to express this view is through options that benefit from a lower EUR/SEK or USD/SEK over the coming months. The krona’s sub-2% yield makes it less appealing for simple carry trades, but that may not matter much. In 2015–2017, rate gaps were similar, yet EUR/SEK traded much lower, often between 9.00 and 10.00. This suggests a stable policy outlook can support SEK gains even when yields are low. Create your live VT Markets account and start trading now.

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EUR/USD slipped after a stronger US jobs report boosted the US Dollar. The pair traded near 1.1875 after falling about 68 pips to an intraday low around 1.1833. US Nonfarm Payrolls rose by 130K in January. That was above forecasts near 70K and higher than December’s revised 48K. The Unemployment Rate edged down to 4.3% from 4.4%.

Jobs Revisions Reshape The Outlook

The BLS revised March 2025 total nonfarm employment down by 898K. It also cut total 2025 job growth to 181K from 584K. That puts average monthly job growth in 2025 at 15K. Average Hourly Earnings rose 0.4% month-on-month in January. That was up from 0.1% and above the 0.3% forecast. Annual wage growth held at 3.7% year-on-year, above the 3.6% estimate. Interest-rate futures now nearly fully price the Fed policy rate to stay in the 3.50%–3.75% range at the March and April meetings, according to CME FedWatch. The US Dollar Index traded near 96.95 after an intraday low around 96.49. The strong January jobs number is hard to square with the large downward revisions for 2025. The revisions suggest the economy was much weaker than previously thought, which muddies the outlook for the dollar. Over the next few weeks, EUR/USD may be tugged between strong recent data and a weaker underlying trend.

Rate Expectations Support The Dollar

Wage growth is still running at 3.7%, and last month’s CPI report showed core inflation remains sticky at 3.9%. That means the Federal Reserve has little reason to cut rates soon. Markets now expect a hold in March and April, which should help support the US dollar in the near term. As a result, aggressive bets against the dollar may be risky right now. The European Central Bank faces a different backdrop. The Eurozone’s January flash inflation estimate cooled to 2.8%. That could allow the ECB to cut rates before the Fed. This policy gap may pressure the euro and limit meaningful upside in EUR/USD. Mixed signals are also lifting options costs. One-month implied volatility for EUR/USD has pushed above 7.0%, showing traders are preparing for a larger-than-usual move. In this setting, buying volatility with strategies like straddles can make sense, since it can profit from a breakout in either direction. For traders who expect the pair to stay stuck in a range, selling volatility may be the better fit. With strong technical levels in place, a range strategy such as an iron condor on EUR/USD options could be a sensible approach. This would benefit if EUR/USD stays choppy while the market digests the major revisions to last year’s data. Create your live VT Markets account and start trading now.

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S&P 500 futures (ES) stayed in a balanced, rotational range during London trade. Value was centred near a developing point of control (POC) around ~6,975. Price held between the pivot “gates” at 6,979.50 (upper) and 6,958 (lower), while cumulative delta stayed positive. On the wider map, the top of the range sat near ~7,010.25 and the bottom near ~6,936.50. The New York open was the key test: will price hold outside the gates, or rotate back through value?

Acceptance And Rejection Framework

Acceptance meant: price spends time beyond a gate, follows through, and then holds on a retest. Rejection meant: a quick push beyond a level that snaps back into value. If price holds above 6,979.50 and stays supported above the POC area, the next path points toward ~7,010. If price cannot hold above 6,979.50, rotates back through value, and then holds below 6,958, then ~6,936.50 comes into view. Positive delta was supportive only if price also moved higher. In a balanced market, a fast move through a gate at the open can often whipsaw. Overall, the market is in a tight, balanced range and waiting for a clear signal. The key levels remain 6,979.50 on the upside and 6,958 on the downside. Until price breaks and holds outside this zone, expect more back-and-forth rotation.

Macro Backdrop And Volatility Implications

This pause fits the macro picture in early February 2026. January payrolls were strong, with 245,000 jobs added, and CPI showed inflation still firm at 3.1%. That mix keeps the market unsure about the Fed’s next step. Attention is now on the March FOMC meeting, the next major catalyst that could end this stalemate. For derivatives traders, indecision often keeps implied volatility relatively low. That can mean options prices do not yet reflect the risk of a larger move after the March Fed decision. A similar “coiling” pattern played out last fall, when the market chopped sideways for three weeks ahead of the November 2025 rate decision, then broke higher. With this setup, pushing aggressive directional trades here is risky. It may be better to position for a volatility pop, or to wait for a confirmed breakout. A sustained acceptance above 6,979.50 could signal a move higher into the Fed meeting, with ~7,010 as the next target. On the other hand, a clean break below 6,958 that holds would suggest weakening sentiment. That would open a path toward ~6,936.50 as the next logical target. The key is confirmation: price should not just tag the level, but accept it and hold on a retest. In the next few days, focus on how New York trade responds at these pivot gates. Be careful with fast opening moves, which often reverse in balanced markets. The best setup is likely not the first break, but proof that the market can stay outside the 6,979.50–6,958 band. Create your live VT Markets account and start trading now.

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TD Securities expects the Bank of Canada’s Summary of Deliberations to add more detail than the cautious statement from January. It expects the Bank to balance two points: ongoing uncertainty, and the fact that the Bank has limited tools to deal with long-term structural headwinds. The firm also expects the minutes to expand on the uneven data that came in before the January decision. It thinks the Bank will note that monthly activity has cooled heading into 2026.

Inflation And Growth Signals

TD Securities does not expect the minutes to show much concern about the recent rise in headline CPI. Instead, it expects the Bank to point to softer core inflation measures and to highlight the impact of one-off factors. The firm expects the minutes to repeat that the Bank discussed several options for its next move. It also expects to see differing views on both timing and direction, plus more detail on what type of shock could change the outlook laid out in the January Monetary Policy Report. The article says it was produced with an AI tool and then reviewed by an editor. It is credited to the FXStreet Insights Team, described as journalists who select market observations and add analysis from internal and external sources. We expect the upcoming Bank of Canada Summary of Deliberations to sound less cautious than the January meeting. The Bank will likely acknowledge that economic activity has cooled as 2026 begins. This more nuanced message may suggest the Bank is becoming more comfortable with the current economic path.

Derivatives And Rates Positioning

Traders should focus on how the Bank discusses inflation, since it will likely look past the recent rise in headline CPI. January 2026 data showed headline inflation at 2.9%, while core measures—preferred by the BoC—fell to an average of 2.5%. We expect the Bank to highlight this underlying disinflation trend. Other recent data also points to a slowdown. The December 2025 monthly GDP report showed a small 0.1% decline. The January 2026 jobs report showed unemployment rising to 6.2%. The deliberations will likely discuss how this weaker backdrop could shape future policy decisions. For derivatives traders, this added nuance may support positioning for an earlier-than-expected policy shift. Uncertainty about the timing of the first rate cut could keep volatility elevated in options on CORRA futures. We see potential value in buying straddles or strangles around the April and June meeting dates. With the data cooling, directional trades that benefit from lower interest rates may also look more attractive. We stayed cautious through the second half of 2025, but the picture is now changing. Going long BAX futures or buying call options on Government of Canada bonds could offer upside. Create your live VT Markets account and start trading now.

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