What's Moving Markets Today

Market Overview

The dollar will experience strength until the FED cut decisions, as data from yesterday's CPI secured smaller rate cut bets.

Data showed that underlying inflation in the US rose more than expected in August, while the annual headline inflation rate slowed for the fifth straight month.

Markets now see an 86% probability that the Fed will reduce the rate by 25 basis points at the upcoming meeting, with just a 14% chance of a larger 50 bps reduction, according to the CME’s FedWatch Tool.

Market Analysis

GOLD - GOLD has maintained within the range, showing a lack of momentum to break above its high. While the price shows new higher lows, we see this market consolidating and moving down until the FED decision on rate cuts.

SILVER - We see SILVER consolidating until FED decisions or even breaking below 27.725, as the potential for further dollar strength comes into the market. Further trading is required for us to understand where this market will head.

DXY - The dollar is trading above 101.786, near its previous high. We expect the dollar to rise higher in a sudden move before crashing after the rate cut decision is announced, assuming analysts and traders react negatively to the markets.

GBPUSD - The pound continues to trade lower as it weakens against the dollar. We expect the possibility of a break below 1.29966.

AUDUSD - The Aussie dollar is gaining strength despite dollar gains, as markets show increased bets on risk-on assets. Yesterday’s trading provided some support for the Aussie dollar and the Kiwi, as 0.66541 held, failing to reach 0.66145 despite higher chances of a fall. We continue to monitor and wait for further confirmations.

NZDUSD - The Kiwi showed recovery after yesterday’s trading, but there is potential for further decline as 0.61408 acts as resistance.

EURUSD - The 1.10090 level cushions the Euro’s fall. Finding potential strength from this point is possible, though we await further trading to confirm direction. However, we may see consolidation, or a potential breakdown in support structure, as Euro weakness remains a possibility.

USDJPY - Yen's weakness suddenly re-emerged as the dollar gained strength. A common trend in the markets is a decline in risk-off assets and increased bets on risk-on assets. Will this trend continue? We will wait and see until the rate cut next week.

USDCHF - The Franc continues to show weakness as risk-off assets lose strength in the market. We continue to see the Franc swings show a large consolidation zone between 0.85541 and 0.84086. We anticipate further weakness to come for the CHF as USD strength comes into the markets.

USDCAD - The CAD shows strength this morning, recovering from 1.35762. There is significant potential for further selling in the market, but we are waiting for further confirmation before calling any direction. Currently, it is consolidating between 1.36328 and 1.35762.