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Crude oil prices took center stage in today’s market action, with WTI extending losses below $63.50 amid speculation over a potential US-Russia meeting. Risk sentiment remained cautious as traders weighed geopolitical developments and the outlook for global demand. Meanwhile, the US Dollar firmed, the Australian Dollar struggled on rising RBA rate cut bets, and the Japanese Yen softened against a rebounding greenback. Precious metals like silver held steady on safe-haven demand, supported by Fed rate cut expectations.
Silver (XAG/USD) is trading just above $38.00, extending its rally amid growing speculation of a Federal Reserve rate cut and renewed uncertainty over tariffs. The precious metal continues to appeal to safe-haven and industrial demand amid a softening U.S. dollar. Recent technical strength has reinforced bullish sentiment, suggesting further upside potential.
Geopolitical Risks: Heightened tariff concerns around global trade are boosting safe-haven flows into silver.
US Economic Data: Subdued labor and inflation data have increased bets on a September Fed rate cut.
FOMC Outcome: Expectations of policy easing are underpinning silver’s appeal as a non-yielding asset.
Trade Policy: Ongoing trade tensions continue to support metal demand as a hedge.
Monetary Policy: Easing global rate environments strengthen interest in safe-haven and industrial metals.
Trend: Bullish continuation as silver sustains a move above the $38 level.
Resistance: Immediate resistance at $38.30, then $38.74, and further targets around $39.00–$40.00 if momentum holds.
Support: Key support levels are $37.70 and $37.42, with downside risk near the 50-day moving average (~$36.90)
Forecast: If price sustains above $38.30, expect upside toward $38.74. A failure to hold current levels may lead to a re-test of $37.70.
Market Sentiment: Bullish tone as safe-haven demand strengthens amid policy uncertainty.
Catalysts: Silver is likely to remain resilient if Fed rate-cut expectations intensify or if tariff tensions escalate further.
WTI crude oil has fallen below the $63.50 level, driven by renewed hopes for de-escalation amid reports of an upcoming U.S.–Russia meeting. The potential diplomatic breakthrough has weighed on risk premiums, undercutting crude prices.
Geopolitical Risks: Rising anticipation of U.S.–Russia diplomatic engagement is dampening fears over supply disruption.
US Economic Data: An overarching soft tone in economic indicators continues to pressure demand expectations.
FOMC Outcome: A dovish Fed outlook reinforces bearish bias for oil as growth concerns weigh.
Trade Policy: Tariff threats and trade tensions add uncertainty to the market outlook.
Monetary Policy: Loose global tone keeps real rates low, providing limited support to oil.
Trend: Bearish continuation reinforced by the break under $64.00.
Forecast: Oil may drift toward $62–$62.50 if diplomatic optimism persists; however, any surprise supply risks could spark a counter move.
Market Sentiment: Tilted bearish amid expectations of reduced geopolitical risk.
Catalysts: Oil is likely to remain under downward pressure unless talks stall or supply concerns resurface, such as delays to OPEC+ production increases or further geopolitical escalation.
AUD/USD is hovering around 0.6500, reversing earlier gains as markets increasingly price in a likely 25 bp RBA rate cut on August 12. Despite strong trade surplus figures, the shift in policy expectations is exerting downward pressure on the currency.
Geopolitical Risks: Trade policy remains benign, offering little support to the AUD.
US Economic Data: Weakness in labor and inflation figures has increased global easing expectations, reducing broader USD strength.
FOMC Outcome: Persistent bets on Fed easing keep risk flows alive despite pressure on AUD.
Trade Policy: A widened Australian trade surplus provides some structural support to the currency.
Monetary Policy: Near-certain RBA easing (with a cash rate likely to drop to 3.60%) is weighing on the Aussie.
Trend: Bearish short-term, erasing recent climb above 0.6550.
Resistance: 0.6525 and 0.6550
Support: 0.6485 and 0.6460
Forecast: AUD/USD may consolidate between 0.6485–0.6525 ahead of RBA’s decision; a cut could further pressure levels toward 0.6460.
Market Sentiment: Cautiously bearish as the likelihood of near-term easing grows.
Catalysts: The Australian Dollar is vulnerable in the short term due to high market confidence in an imminent RBA rate cut.
The US Dollar Index (DXY) remains firm above the 98.00 level following reports that Fed Governor Christopher Waller is emerging as a leading contender to replace Jerome Powell as Federal Reserve Chair. The prospect of Waller, known for a measured and data-driven approach—including support for rate cuts—has underpinned the Dollar’s strength.
Geopolitical Risks: None immediate; markets are focused squarely on Fed leadership developments.
US Economic Data: Recent weakness in jobless claims bolstered expectations of impending rate cuts.
FOMC Outcome: The potential appointment of a dovish chair like Waller reinforces a near-term easing narrative.
Trade Policy: Tariff uncertainty remains a factor, but has not gained front-stage prominence today.
Monetary Policy: Anticipated shifts in Fed direction shape broader expectations for the Dollar’s trajectory.
Trend: Bullish, with price consolidating above 98.00
Resistance: 98.40 – a key short-term hurdle.
Support: 98.00 followed by 97.50 in case of pullback
Forecast: DXY may continue to edge upward if clarity around Fed leadership emerges, with upside toward 98.40. Otherwise, a loss of the 98.00 base could hint at short-term consolidation.
Market Sentiment: Cautiously bullish amid speculation over Fed leadership and impending rate policy shifts.
Catalysts: The dollar is being buoyed by growing market confidence that Waller, a plausible successor to Powell, may steer the Fed toward easier policy.
USD/JPY trades near 147.35, weakening as traders react to uncertainty around the timing of the next Bank of Japan (BoJ) rate hike and possible U.S.–Japan trade tensions. Despite this softening, expectations of Fed rate cuts and limited safe-haven demand are buffering the Yen from deeper deterioration.
Geopolitical Risks: Rising U.S. tariff concerns are undermining JPY demand.
US Economic Data: Indicators weaken support for USD, reducing full downside on JPY.
FOMC Outcome: Fed’s dovish stance is limiting USD upside, while keeping yields support intact.
Trade Policy: Rising trade policy fears strain JPY but also dampen extreme USD moves.
Monetary Policy: Mixed BoJ signals — possibility of hikes later in the year — cap JPY weakness.
Trend: Neutral-to-mild bearish.
Resistance: 147.70, then near 148.00.
Support: 147.00, followed by 146.50.
Forecast: USD/JPY may consolidate between 147.00–147.70 unless further catalyst emerges.
Market Sentiment: Cautiously bearish toward the Yen as risk tone improves.
Catalysts: The pair’s direction will hinge on further clarity from BoJ on policy intentions and developments regarding U.S.–Japan trade relations.
As oil markets continue to react to shifting geopolitical dynamics and global monetary expectations, traders remain on edge for further signals. With central bank cues, diplomatic developments, and inflation data in focus, the near-term trajectory for commodities and major currencies hinges on how these themes unfold.
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