Hello traders, and welcome to the first full trading week of September! As we gear up for a busy week ahead, all eyes will be on the Non-Farm Payrolls (NFP) report this Friday, which is expected to set the tone for market sentiment. But let's not get ahead of ourselves—it's only Monday, and today starts off on a quieter note, especially with the U.S. and Canada observing Labor Day. This holiday means we can anticipate slightly lower volatility, particularly toward the end of the European session when trading volume typically thins out.
Indices are starting the week with futures in the red, but given that we're still hovering near long-term highs, there's no cause for alarm. The mid- and long-term sentiment remains positive, suggesting that any dip could just be a minor pullback in an otherwise bullish trend.
Turning to the currency market, we're seeing some interesting movements. The Australian Dollar is currently the strongest currency, while the New Zealand Dollar is the weakest—an unusual divergence between these typically correlated currencies. This rare discrepancy offers some intriguing trading opportunities. Additionally, the Euro is showing bullish setups across several pairs, indicating a potential for long-term buy signals as the day progresses. We'll be watching closely to see if this positive momentum in the Euro pairs materializes into actionable trading signals.
In the commodities market, oil is starting the week on a negative note after a rough performance last week. The bearish sentiment continues to dominate, putting oil under pressure as we enter the new week. In contrast, there’s a divergence between gold and silver. Silver is looking quite weak following a large head and shoulders pattern, signaling potential further downside. Gold, however, remains resilient, hovering near long-term highs and showing a much stronger profile compared to silver. This divergence highlights a stronger demand for gold, possibly as a safe-haven asset amid global uncertainties.