A hint of risk-off sentiment sends US stock market indices lower, while Gold and Silver also decline to trade below key support.
- The market mood is shifting a weak risk-off feeling as the new week gets underway after the end of the US holiday, with US equity indices like the S&P 500 and the NASDAQ 100 declining, although some markets in Asia are holding up. We are seeing typical correlations here like a decline in the AUD/JPY currency cross (a key risk barometer) and both Gold and Silver falling below key support levels, and the psychological round numbers $5,000 and $75 respectively. However, it should be noted that Gold is showing signs of finding solid support at the very key level of $4,880 which gave strong support to the price last week.
- In the Forex market, the strongest major currency since today's Tokyo open has been the Japanese Yen, while the weakest has been the Australian Dollar. The US Dollar is quiet and has barely changed, although the 2-year US treasury yield is very close to making a new 3.5 year low, showing that the expectation of 3 US rate cuts over 2026 is holding.
- A former board member of the Bank of Japan has suggested that the next rate hike of 0.25% there will happen in April, with the Bank looking to eventually raise its rate to 1.25% - today it is 0.75%.
- Bitcoin is still looking essentially bearish as it keeps failing to break above the key resistance level at $71,762. At the time of writing, the short-term price action is consolidative as it trades below the resistance level at $69,323.
- There will be data releases due today concerning:
- Canadian CPI (inflation)
- Reserve Bank of New Zealand policy meeting
- UK Claimant Count Change (unemployment claims) data was just a touch worse than expected, which had no effect on the market.