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Markets opened Friday with a mixed tone as precious metals outperformed while energy prices weakened, reflecting shifting risk sentiment ahead of key U.S. data. Silver rallied above $49.50, marking another multi-year high amid growing expectations of a Federal Reserve rate cut, while Oil prices extended declines below $61.50 as geopolitical tensions in the Middle East eased. Meanwhile, the U.S. Dollar stayed firm near multi-month highs, supported by safe-haven flows and cautious positioning ahead of upcoming U.S. inflation figures. Major currencies such as the Japanese Yen and Canadian Dollar faced additional pressure from domestic fiscal and commodity headwinds.
Silver has climbed above $49.50, extending gains as traders price in higher Fed rate-cut odds and safe-haven demand. The rally comes amid a weaker oil complex and a firmer U.S. dollar, but momentum remains strong given silver’s dual store-of-value and industrial demand narrative.
Geopolitical Risks: Ongoing geopolitical uncertainty supports safe-haven buying in precious metals.
US Economic Data: Incoming U.S. inflation and payroll figures will be key to whether rate-cut expectations (which support metals) hold.
FOMC Outcome: Markets are increasingly pricing Fed easing later this year, which reduces real yields and benefits silver.
Trade Policy: Stable trade flows for now keep industrial demand assumptions intact, supporting silver’s industrial bid.
Monetary Policy: Dovish turns or softer guidance from major central banks underpin precious metal demand.
Trend: Strong bullish trend in the short-to-medium term after clearing multi-year resistance.
Resistance: Immediate resistance near $50.00, then $51.20.
Support: Initial support at $48.20–$48.00, with stronger support around $46.80.
Forecast: Expect continued upside pressure with intermittent profit-taking; a sustained close above $50 would open the path to $51–$52, while a failure to hold $48 may trigger a deeper pullback.
Market Sentiment: Bullish — traders view dips as buying opportunities while Fed-cut expectations remain priced.
Catalysts: U.S. inflation prints, Fed speakers/minutes, and any sudden shifts in risk appetite will determine silver’s next leg.
WTI has declined below $61.50 after easing Middle East tensions reduced near-term supply risk premia. Mixed inventory data added to a softer tone, with buyers reluctant to aggressively re-enter until demand signals improve.
Geopolitical Risks: Cooling Middle East tensions have removed part of the risk premium that supported crude.
US Economic Data: Softer U.S. demand expectations and mixed API/EIA reads weigh on near-term prices.
Trade Policy: No major trade disruptions; global trade stability provides a baseline for demand.
Trend: Mildly bearish in the short term after failing to hold recent support.
Forecast: Expect consolidation in the $59–$63 range; a decisive break below $60 would increase downside risk, while confirmation of tightening rhetoric from OPEC+ could push prices higher.
Market Sentiment: Cautiously bearish to neutral as geopolitical risk recedes and inventories remain mixed.
Catalysts: EIA weekly inventories, OPEC+ commentary, and demand signals from China and the U.S.
USD/CAD remains above 1.4000, trading near six-month highs as oil weakness and a firmer U.S. dollar pressure the Canadian dollar. The pair’s strength reflects commodity headwinds for CAD alongside resilient U.S. yield dynamics.
Geopolitical Risks: Energy-related risks and global growth concerns influence CAD via oil price sensitivity.
US Economic Data: Strong U.S. macro prints and safe-haven flows support the dollar and USD/CAD.
FOMC Outcome: Fed communications that keep the dollar bid will likely sustain USD/CAD upside.
Trend: Bullish in the near term with upward momentum above 1.4000.
Resistance: 1.4035–1.4060, then psychological 1.4100.
Support: 1.3950, then 1.3890.
Market Sentiment: USD-biased; risk-averse flows and weak commodity prices favor the dollar.
Catalysts: Oil price moves, BoC commentary, and U.S. inflation/CPI prints.
The PBOC set the USD/CNY reference at 7.1048, slightly firmer compared with the prior fix, indicating Beijing’s calibrated approach to managing yuan moves. The guided fix suggests authorities are tolerating modest CNY strength while watching capital flows and export conditions.
Geopolitical Risks: US–China tensions and global risk dynamics can prompt capital flow adjustments that affect the yuan.
US Economic Data: Strong U.S. data would pressure CNY by widening yield differentials; weaker U.S. data eases that pressure.
FOMC Outcome: Fed policy moves affect USD strength and thus USD/CNY through interest-rate differentials.
Trend: Neutral-to-slightly bearish for USD/CNY (i.e., modest yuan strength) given the firmer fix.
Resistance: 7.1200, then 7.1400.
Support: 7.0900, then 7.0700.
Forecast: Expect a managed range with a bias toward stability; significant USD strength would test resistance levels, while PBOC intervention could cap moves.
Market Sentiment: Cautiously neutral; market expects PBOC to smooth extreme moves.
Catalysts: Further PBOC fixing patterns, Chinese trade/PMI prints, and U.S. inflation or FOMC-derived USD pressure.
USD/JPY is trading near eight-month highs, with the yen hanging near multi-month lows as fiscal concerns and an uncertain BoJ outlook keep the currency under pressure. The pair reflects continued policy divergence and stronger U.S. yield dynamics.
Geopolitical Risks: Regional and global tensions, combined with risk flows, continue to impact safe-haven demand for the yen.
US Economic Data: Robust U.S. indicators and yield support the dollar and push USD/JPY higher.
FOMC Outcome: Any signal that keeps the dollar supported will likely feed further yen weakness.
Trade Policy: Limited direct trade shocks; currency moves are dominated by policy and yields.
Trend: Strongly bullish for USD/JPY (yen weakening).
Resistance: 154.00 (near-term psychological), then 155.50.
Support: 151.20, then 149.80.
Forecast: USD/JPY could push to fresh multi-month highs if BoJ remains dovish and U.S. yields stay elevated; sharp risk-off moves would be required to reverse the trend.
Market Sentiment: Bearish on JPY; traders are positioned for continued policy divergence.
Catalysts: BoJ commentary and minutes, Japan fiscal updates, and U.S. Treasury yield moves.
Overall, global markets continue to grapple with diverging monetary and geopolitical forces, setting up a volatile backdrop for traders. Precious metals remain supported by easing yields and dovish Fed expectations, while oil and commodity-linked currencies face headwinds from a stronger greenback.
As attention turns to next week’s U.S. inflation and retail data, volatility across FX and commodities may intensify, offering short-term trading opportunities for momentum and technical traders alike.
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