Hello traders, and welcome to Monday—a fresh start to the new week! While the economic calendar is light today with no key data releases and the earnings calendar is empty, there’s still plenty of action to keep an eye on, especially with the Japanese Yen taking center stage.
The Japanese Yen is making a strong comeback today, driving the USD/JPY pair significantly lower. In fact, USD/JPY is currently the weakest currency pair, dropping by 1.2%. From a technical perspective, this move suggests the end of a recent correction for the Yen and the beginning of a new bearish wave for the USD/JPY. It appears that the Yen is returning to its bearish trend, signaling a potential continuation of weakness in the dollar against the Yen.
Looking broader across the currency markets, the Japanese Yen is leading the pack as the strongest currency today, followed by the New Zealand Dollar and the Swiss Franc. On the flip side, the American Dollar, Canadian Dollar, British Pound, and Euro are among the weakest performers, struggling to gain any momentum.
Turning to futures, after an impressive run last week, we’re seeing a small bearish correction this morning. However, this pullback seems insignificant in the grand scheme of things, as the overall bullish sentiment remains very strong. The markets are still riding high from last week’s gains, and this minor correction could be just a brief pause before the next upward move.
In the commodities space, oil continues to struggle with negative sentiment, extending its recent losses. However, the story is quite different for precious metals, with gold and silver climbing higher—particularly silver, which has seen significant gains. The long-term outlook for gold remains strong, adding to its appeal as a safe haven. Copper is also enjoying a positive correction, continuing its solid performance in August, which so far has been a very good month for the metal.
As we kick off this new week, the market sentiment is mixed, with strength in the Yen and precious metals, and weakness in oil and certain currencies. It will be interesting to see how these trends develop as the week progresses.