Quick Hits from Today’s Markets

Market Overview

Last weeks non-farm employment change resulted in mixed reactions, coming in at 142k—lower than expected but higher than the previous month, placing it between both levels.

The markets are pricing in a 100% chance of a 25 bp rate cut at the September 17-18 FOMC meeting and a 34% chance of a 50 bp rate cut.

With that, we may see a slowdown in the dollar after the September cut if a 25 bps cut occurs, as investors will likely anticipate further cuts in the coming months. In the short term, buying the dollar may prove profitable, while selling pressure could emerge after the data releases. However, consolidation may continue until then, allowing traders to secure funds and position themselves at a favorable price.

CPI data and PPI to come out later this week may help in the further navigation of market expectations.

Market Analysis

GOLD - GOLD remains steady, with traders eyeing U.S. inflation data expected on Wednesday and Thursday. These reports could reinforce market expectations on the size of the rate cut at the upcoming September Federal Reserve meeting. Prices remain between 2532.239 and 2483.417.

SILVER - Silver continues to consolidate, supported at 27.725, while traders monitor potential dollar sell-offs. Risk management is crucial in this uncertain environment, as volatility persists ahead of clearer signals regarding rate cuts.

DXY - USD moved upward as predicted, reaching 101.786 amid lower expectations for a 50 bps rate cut. Traders may be pushing the dollar higher to sell at a premium after the cuts. We are watching for further market reactions following the inflation data.

GBPUSD - GBPUSD broke below 1.31907 and continues to show weakness against the dollar. The pound is expected to fall further as bearish structures gain momentum.

AUDUSD - AUDUSD has dropped to 0.66541, reflecting broader weakness as traders move away from risk-on assets. We maintain a bearish outlook for this market, anticipating further declines.

NZDUSD - NZDUSD mirrors the Aussie dollar in weakness, and we continue to expect selling pressure in the near term. A rise is possible depending on how markets respond to upcoming inflation data and the Fed's decision.

EURUSD - EURUSD is holding at 1.10361 and appears ready to break below. However, consolidation may persist until clearer market signals emerge.

USDJPY - USDJPY is recovering to 143.442, though we expect selling pressure to resume. A sudden drop to hit stops before any potential rise is possible.

USDCHF - USDCHF is losing strength after yesterdays trading, but the potential for long-term selling remains. However, a bullish structure may be forming, and we await further confirmations.

USDCAD - USDCAD remains strong, with 1.35762 holding firm. Canadian dollar strength is expected to continue, despite the oil field shutdowns in Libya. Market expectations seem to have limited effect on the Loonie for now, with oil prices staying relatively low.