HFMarkets (hfm.com): Market analysis services.

[HFM]

Date:15th January 2026.

From ETFs to Technicals: What’s Fuelling Silver’s 2026 Rally.

The best-performing asset in 2026 so far is Silver. Silver paused during the Asian session this morning after rising for four consecutive days. However, technical analysis is not yet indicating a prolonged downturn.

So, why is Silver the best-performing asset of 2026, and what are analysts predicting for 2026?

The increase that Silver is experiencing is largely due to demand from institutional investors rather than physical demand. According to the latest reports and projections, demand for physical Silver is likely to slightly decrease over the next 12 months.

Institutions are buying Silver for similar reasons to Gold, however, Silver is much more volatile and cheaper to purchase. The slightly lower inflation readings from this week, projections for more frequent interest rate cuts, and questions over Fed independence are increasing demand.

Economists are not expecting the Federal Reserve to cut interest rates this month, nor in March 2026. For this reason, the US Dollar has slightly risen while stocks have fallen. However, economists do believe that in the second and third quarters of the year, the Fed will need to make frequent rate cuts. On average, economists believe the Fed will need to cut by 0.75% by the end of the year. This would take the Federal Fund Rate to 3.00%, the lowest since the summer of 2022.

For this reason, investors expect the Federal Reserve to delay cuts in the first quarter but eventually cut rates later in the year. At the same time, investors are incorporating political risks into their strategy, which is resulting in a need for Gold and Silver. These include the Federal Reserve’s independence and US global intentions such as within Greenland.

In addition, investors are also treading cautiously as the US Midterms will take place later in the year.

Market participants are reviewing the Silver Institute’s early 2025 outlook, which expects global industrial silver demand to fall 2% to 665 million ounces. The decline reflects trade policy uncertainty and reduced use in electronics and photochemical applications.

Demand for physical bars and coins is also expected to drop to a seven-year low, down 4% from 2024. However, strong investment inflows into Silver ETFs rose 18%, with net inflows of 187 million ounces. This is likely to offset weaker physical demand and help support prices, particularly as investors seek protection from inflation and currency volatility.

On the CME, Silver trading activity spiked on 7 January, with volumes reaching 195,000 contracts, well above the early-month average.

HFM - 15-Minute Chart

Due to the bullish price movement, indicators and price action are understandably pointing towards Silver’s trend continuing. Even with the current retracement, the price fell to the previous low and did not necessarily form significant breakouts.

When looking at the 2-hour timeframe, the price of the metal remains above the key Moving Average, above the neutral area of the RSI, and the MACD. For this reason, indicators continue to point towards buyers maintaining control. Fundamental analysis also indicates this, with inflation reading slightly lower. The main risk for Silver and Gold is the rise in the US Dollar. If the US Dollar declines, Silver can potentially strengthen further.

The only indicators currently pointing towards a downward price movement are the 200-bar Moving Average on the 5-minute timeframe. The price currently remains below this level, giving a bearish bias. However, the price is currently rising and trading close to this level. If the price forms a bullish breakout at $90.185, the bearish bias is likely to fade.

• Silver leads 2026 performance. It’s the top-performing asset so far, despite a brief pause after four consecutive days of gains.
• Institutional demand drives momentum. Growth is fuelled by ETFs and institutional buying rather than physical silver demand.
• Fed rate expectations influence buying. Investors anticipate rate cuts later in 2026, boosting silver and gold as hedges.
• Physical demand is declining. Industrial use and coins/bars are projected to drop, but ETF inflows (up 18%) support prices.
• Technical indicators remain bullish. Silver’s price is holding above key moving averages and RSI/MACD signals, suggesting buyers remain in control.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

 

[HFM]

Date:16th January 2026.

USDJPY: Intervention On The Table With US Support.

Japan's finance minister tells journalists that the Japanese government is considering currency intervention to support the Japanese Yen. The Japanese Yen Index has already fallen more than 1.00% in the first 2 weeks of 2026. Though, the main concern for the Japanese Federal Government is the decline against the US Dollar, which at one point was almost at a 2% decline.

The Japanese Yen is currently the second best performing currency during this morning’s Asian session, after the New Zealand Dollar.

Analysts cannot advise that a currency intervention is certain without any doubt. However, over the past week, the Japanese government has told journalists that they will support the currency. When asked about direct currency intervention, the finance minister said the option remains on the table.

For this reason, many traders do believe the government will boost the currency with an intervention, or if they opt not to intervene directly, they will explore other options. It is important to note that the Bank of Japan is not likely to adjust interest rates without the snap elections ending first: the BOJ is due to announce their decision on Japan’s monetary policy next Friday, however, the snap election will most likely not take place until mid-February.

Previously the government's interventions have not been successful other than a short-lived spike. However, according to Japan’s finance minister, on this occasion the move would be supported by the US.

Some economists argue that with Japan’s new expansionary fiscal policy vision, the BOJ is more easily able to increase rates. Although, with the BOJ it's never that simple and they are traditionally known to move slowly.

Market participants are reviewing December’s wholesale inflation data. Monthly inflation slowed from 0.3% to 0.1%, while annual inflation eased from 2.7% to 2.4%, mainly due to lower fuel prices. However, inflation remains above the Bank of Japan’s 2.0% target, which supports the case for maintaining a hawkish policy stance.

According to a Reuters survey of leading economists, most expect the Bank of Japan to pause until July before raising interest rates again. Whereas, other economists believe the cut could come as early as April. The Bank of Japan will most likely raise rates by 0.25% and at most rise to 1.25% by the end of the year.

If the Bank of Japan does not raise rates, the government will struggle to support the Japanese Yen in 2026.

The US Dollar is trading lower this morning, but has been one of the best performing currencies of the week. The US Dollar Index has risen to its highest price since December 9th.

Inflation has read more or less as per expectations, but economic data has been significantly higher. The Weekly Unemployment Claims fell to 198,000, the lowest in 6 weeks and lower than expectations. The US Retail Sales, Empire State Manufacturing Index and Philly Index have also all risen above expectations.

Due to this, the market is expecting the Federal Reserve to pause in January and March unless data deteriorates. According to the Chicago Exchange, there is a 78% chance of no rate cuts in the first quarter of 2026. By the end of the year there is a 32% chance of 2 rate cuts, a 27% chance of 1 rate cut and a 21% chance of 3 rate cuts this year. However, the Federal Reserve’s hawkishness for the first quarter is supporting the US Dollar.

HFM - USDJPY 15-Minute Chart

When it comes to government interventions, spreads tend to widen during the sudden spike in volatility and the price movement happens relatively quickly. Therefore, traders may consider an earlier entry with a medium-term view.

On a 2-hour chart, the USDJPY has retraced back to the 75-bar Exponential Moving Average which can act as a support level. However, if this level is broken, sell signals may materialise on this timeframe. The MACD and RSI on the 2-hour chart are indicating downward price movement.

On the 5-Minute timeframe the 200-bar Simple Moving Average and VWAP are indicating a bearish bias. According to the 200-bar EMA, sell signals are likely to remain as long as the price remains below 158.400. The main support level can be seen at 157.760.

• Japan’s finance minister says currency intervention remains an option as the Yen weakens against the US Dollar.
• Traders expect government support, but the Bank of Japan is unlikely to change interest rates until after the snap election.
• Economists see limited rate hikes in 2026, with policy rates likely peaking near 1.25%.
  Strong US economic data and a hawkish Federal Reserve continue to support the US Dollar.
• Technical indicators suggest downside risk for USDJPY unless prices move back above key resistance levels.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

 

[HFM]

Date:19th January 2026.

Trump’s Greenland Tariffs Shake Global Markets: Europe & NATO Pushes Back.

President Trump sinks the global stock market amid fears over a new trade war over the status of Greenland. Global indices, including those in the US, Europe and Asia, trade lower on Monday, with European stocks experiencing the largest falls. In addition to global indices experiencing a bearish decline, the US Dollar also falls at the market open.

The downward price movement comes as a result of President Trump increasing the pressure on Denmark and the EU to agree to the purchase of Greenland. According to the US administration, the purchase is required for ‘global and national security’. In the President’s weekend speech, journalists were told that the US will impose tariffs on the UK and EU starting on 1 February. According to the President, this will happen unless they support his Greenland purchase proposals.

US Tariffs on the UK and Europe​

The trade tariffs that have so far been announced are 10% on all trade starting from 1 February, rising to 25% on 1 June. The EU, UK, and other NATO countries are pushing back hard on the US demands and are looking for a compromise. According to political experts, the EU is attempting to agree to a joint presence within Greenland. This includes both military, trade, and institutional presence.

However, according to the US President and administration, the US will only agree to a total purchase of the island. The latest member of the administration to speak on the matter is the Treasury Secretary, Scott Bessent. According to the Treasury, the European’s proposal on Greenland is ‘outsourcing our security to other countries’. Mr Bessent was quick to reject this while speaking on NBC news. Mr Bessent also made it clear that there is a race to the Arctic and the US is looking to build a protective ‘dome’ around the US hemisphere. The US’s main concerns in the region are Russia and China.

The DAX & The EU Response​

The DAX is witnessing a decline of 1.30% due to the US-EU tensions over the weekend. The bearish price gap on Monday measures 1.45%, and the index is trading at a two-week low. The pressure from sellers is solely due to political tensions and the tariffs that have been thrown on the table.

HFM - DAX 1-Hour Chart

European leaders have been quick to condemn the tariff as dangerous, warning that they undermine transatlantic relations, and are unacceptable. US leaders have been quick to make statements emphasising sovereignty, unity, and international law. Currently, all EU countries as well as other NATO members have made it clear they will not sell Greenland to the US and will plan countermeasures.

Countermeasures, in simple terms, are likely to increase military presence on the island and counter tariffs. Some members of the EU have already met on Sunday evening, but more meetings are due throughout the week. French President Emmanuel Macron has reportedly urged the European Union to use its ‘anti-coercion instrument,’ often called the ‘trade bazooka.’ This tool would allow the EU to limit US access to European markets or introduce export restrictions as part of a wider set of possible responses. It is being rumoured the German Chancellor also agrees. Other heads of state have mentioned imposing tariffs on the US worth $108 billion.

Greenland and Denmark both held demonstrations over the weekend in their capital cities. As we can see, the US, NATO, and the EU are gearing up for what looks to be high tensions for the whole of 2026. Unless an agreement is reached, the stock market will struggle to maintain the bullish momentum from the past two-plus years.

Technical analysts advise the price will be very reactive to comments made on the situation, meaning fundamental analysis will also be key. The DAX’s decline has taken the index from a Buy signal on the two-hour chart to a ‘neutral’ signal.

NASDAQ Hits 17-Day Low​

The Nasdaq is witnessing the largest decline within the US after the US-EU tensions over the weekend. The bearish price gap on Monday measures 0.95%, and the index is trading at a 17-day low. Even though global indices are trading lower, the Nasdaq is experiencing slightly stronger bearish signals.

HFM - NASDAQ 3-Hour Chart

The VIX is currently trading more than 9% higher, one of the strongest increases in recent months. The higher VIX indicates a lower risk appetite within the market and fear amongst investors. The price of the Nasdaq is currently trading below the day’s VWAP and below Moving Averages.

For this reason, the Nasdaq is maintaining its bearish bias and, according to analysts, this potentially remains until further clarity. The main price driver will remain any comments from politicians on Greenland and tariffs. However, Netflix will also release its quarter earnings report tomorrow after market close. Netflix is the 14th most influential company for the Nasdaq, and its earnings report is also likely to impact its performance.

Key Takeaways:​

• Stocks fall as fears of a US-EU trade war over Greenland spike, with European stocks hit hardest. The US Dollar is also weakening.
• Trump threatens tariffs on the UK and EU from 1 February(10%, rising to 25% by June). Trump advises tariffs will be removed once they agree to a full US purchase of Greenland.
• Europe and NATO reject the proposal, emphasising sovereignty, unity, and international law, and preparing countermeasures, including possible tariffs.
• Stock indices show bearish signals: the DAX and Nasdaq are at multi-week lows. The VIX rose 9%, signalling increased market fear and lower risk appetite.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

 

[HFM]

Date:20th January 2026.

Global Markets Volatile as US-EU Trade Tensions Rise and Japan’s Bond Yields Surge.

Global financial markets entered the week under renewed pressure as escalating geopolitical tensions between the United States and Europe reignited fears of a fresh trade war. Investor sentiment weakened sharply after US President Donald Trump intensified rhetoric surrounding Greenland, threatening broad tariffs on several European nations just as Wall Street heads into a pivotal earnings season.

The convergence of geopolitical risk, legal uncertainty around US trade policy, and rising global bond yields has pushed markets into a defensive posture, weighing on equities while supporting safe-haven assets and volatility-sensitive instruments.

US equity futures signalled a sharply weaker start to Tuesday’s session following the holiday closure. Dow Jones Industrial Average futures slid more than 1%, implying a drop of over 500 points at the open. S&P 500 futures declined around 1.2%, while Nasdaq 100 futures underperformed with losses exceeding 1.4%.

The move reflects mounting concern that renewed trade frictions could undermine corporate earnings expectations, disrupt cross-border supply chains, and slow global economic momentum, particularly at a time when equity valuations remain stretched.

US stocks are coming off a negative week, leaving markets more vulnerable to macro and geopolitical shocks.

Over the weekend, President Trump announced plans to impose tariffs on imports from eight European NATO members unless negotiations begin over the ‘complete and total purchase of Greenland’. Under the proposal, tariffs would start at 10% in early February and rise to as much as 25% by mid-year.

European leaders swiftly rejected the threat, warning that such actions risk damaging transatlantic relations and triggering retaliatory measures. Reports suggest the EU is considering counter-tariffs worth up to $108 billion, raising concerns over a broader escalation that could weigh heavily on global trade and investment flows.

Trump’s upcoming address at the World Economic Forum in Davos is expected to be closely scrutinised for further policy signals.

Markets are also watching a potential US Supreme Court ruling on whether the President’s use of the International Emergency Economic Powers Act to impose tariffs is constitutional. A decision could arrive as soon as this week.

While US officials have expressed confidence that the policy will stand, any legal challenge to executive trade authority could significantly alter expectations around future tariffs, adding further volatility across equities, currencies, and commodities.

Beyond geopolitics, investor focus is shifting to a busy US earnings calendar. Major companies including Netflix, Intel, and Johnson & Johnson are set to report, with forward guidance expected to be more influential than headline results.

Consensus forecasts point to S&P 500 earnings growth of roughly 12%-15% this year. However, lingering ‘Sell America’ sentiment, rising geopolitical risks, and tighter financial conditions suggest downside risks remain, particularly for multinational firms with significant overseas exposure.

Asian equities mostly declined amid rising global risk aversion.

• Japan: The Nikkei 225 fell more than 1%, pressured by surging bond yields and election uncertainty.
• China: Mainland and Hong Kong markets edged lower, tracking global weakness.
• South Korea: The Kospi posted modest gains, bucking the regional trend.
• Australia: The ASX 200 slipped as external headwinds outweighed domestic factors.

For FX and rates traders, Japan remains a key focal point, with bond-market volatility carrying potential implications for capital flows and yen dynamics.

A sharp sell-off in Japanese government bonds intensified on Tuesday, pushing long-dated yields to record levels and adding to global market unease. Investors reacted negatively to Prime Minister Sanae Takaichi’s election platform, which includes a proposal to cut taxes on food without clearly identifying a funding source.

The yield on Japan’s 40-year government bond surged beyond 4%, marking the highest level since the instrument was introduced in 2007 and the first time in over three decades that any Japanese sovereign maturity has reached such territory. Yields on both 30- and 40-year bonds jumped more than 25 basis points in a single session, the steepest move since the market turmoil following last year’s US tariff shock.

A weak auction of 20-year bonds earlier in the day reinforced investor concerns about rising government spending, fiscal sustainability, and inflation risks. Since Takaichi took office in October, yields on Japan’s 20- and 40-year debt have climbed by around 80 basis points.

Importantly for global markets, volatility in Tokyo spilled over into US Treasuries during Asian trading hours, with 30-year US yields rising by roughly 7 basis points, highlighting Japan’s growing influence on global rate dynamics.

Market participants are increasingly alert to the risk that continued instability in Japanese bonds could reverberate across global fixed-income markets, particularly as Japan’s long-term yields now exceed those of Germany at comparable maturities.

While some long-term investors see rising yields as improving value, especially on a currency-hedged basis, the broader concern is that bond markets are signalling discomfort with Japan’s fiscal trajectory. With a snap election scheduled for February 8, volatility in Japanese assets is expected to remain elevated.

European equity markets closed sharply lower, led by export-heavy indices. Germany’s DAX and France’s CAC 40 suffered notable losses, while the UK’s FTSE 100 declined more modestly. European leaders warned that escalating tariffs could spark a damaging cycle of retaliation, further clouding the region’s already fragile growth outlook.

Gold prices remained just below record highs, supported by safe-haven demand and a softer US dollar. Silver, after briefly reaching an all-time high, eased slightly as traders locked in profits. Geopolitical uncertainty, rising bond volatility, and concerns over global growth continue to underpin defensive positioning, keeping precious metals in focus.

Crude oil prices stabilised, balancing geopolitical uncertainty against concerns that supply is outpacing demand. Brent crude hovered in the mid-$60s per barrel, while WTI remained below $60.

Despite tensions surrounding US-EU relations, traders remain focused on increasing OPEC+ output and warnings from the International Energy Agency that a surplus could emerge this year. A weaker US dollar has provided some near-term support, but the broader outlook remains cautious.

Looking ahead, markets are bracing for key macro events:

• Federal Reserve: Rates are widely expected to remain unchanged at the next meeting, as policymakers balance cooling labour markets against inflation still above target.
• Bank of Japan: This week’s policy meeting will be closely watched following the surge in bond yields.
• US Inflation Data: Upcoming releases of the Fed’s preferred inflation measure may shape expectations for the policy path ahead.

In the days ahead, market direction is likely to be driven by:

• Developments in US–EU trade negotiations
• Earnings guidance and analyst revisions
• Japanese bond market volatility and global yield spillovers
• Safe-haven flows into gold and FX markets
• Central bank communication and inflation trends

With geopolitics, earnings, and monetary policy all in play, conditions point to continued volatility, placing a premium on risk management, flexibility, and cross-asset awareness.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

 

[HFM]

Date: 21st January 2026.

Trump Davos Speech To Determine Markets’ Next Move.

Gold continues to increase in value due to concerns over the NATO alliance, the Greenland crisis and bond yields. This week, the price of Gold has risen by almost 6% taking the safe-haven asset to an all-time high.

The escalations regarding the status of Greenland have been a well-covered story and price driver. However, this is not the sole reason for investors increasing their exposure to Gold. In December, HFM’s analysts explained technical and fundamental indicators which point towards Gold rising to $5,000. The price this year has so far risen by 12.50% and is 3.10% away from reaching this target.

The US President, Donald Trump, held his last press conference at the White House before travelling to Davos, Switzerland. In the press conference, the President was extremely clear that his speech will be focusing on Greenland and that many meetings are scheduled throughout the day with various leaders.

The outcome of these meetings and Trump’s speech at 18:00 GMT Time will be key in determining the future price movement of Gold. However, traders should note that air traffic is likely to delay the speech. If investors feel the speech is ‘aggressive’ or gives indications of a new trade war, the price of Gold is likely to remain in high demand. This is due to its status as a safe-haven asset.

So far, political analysts say his recent press conference was more balanced than his previous comments. On allied relations, he said he expects cooperation from NATO and called European leaders his ‘friends’. Nonetheless, the market continues to increase its exposure to Gold and is not taking any risks until tonight’s speech.

Currently, analysts are advising that there is not a bond crisis. However, there are clear signs of stress. Due to this, investors are more eagerly purchasing Gold.

Even though the latest US bond auction was relatively successful, the risks can still be seen in bond yields. US bond yields have risen to their highest since August 2025 and the Japanese 10-year bond yields have risen to levels not seen in two decades.

Japan’s 10-year bond yield has risen because the Bank of Japan is no longer keeping rates artificially low. The BOJ has started raising rates and buying fewer bonds, while investors are also worried about inflation and government spending. Since the central bank is stepping back from strict control, bond yields are now free to rise to more normal, market-driven levels.

Rising bond yields are known to pressure the price of Gold. However, yields are currently rising while investors believe most global central banks will need to cut their interest rates. For this reason, higher bond yields are actually supporting Gold.

Other factors are also supporting Gold, such as the performance of the stock market. The S&P 500 has fallen to a monthly low in just three days and companies are forecasting weaker performance in the upcoming months. Netflix is the most recent company to announce its earnings report, which beat expectations. However, the stock fell more than 5% as the CEO gave a dim outlook for 2026. If stocks continue to underperform, Gold may again see higher demand.

The US stance on Greenland has been well-documented. European leaders have signalled concern about the dispute but their stance is less known. France and the EU are looking at measures to boost Arctic security and defend Danish sovereignty over Greenland, including potential defence and investment packages.

If Europe takes a similar stance to the UK, in other words, not reacting and triggering a trade war. The bullish trend may lose its momentum as markets will view this as a de-escalation.

HFM - XAUUSD 4-Hour Chart


So far this week, Gold’s bullish trend has not seen a retracement, which indicates the strength and momentum of the trend. However, the price is showing as overbought on most timeframes when analysing the Relative Strength Index. Markets are not currently showing concern that the price is overbought as there are fundamental reasons for demand.

Nonetheless, investors will monitor retracements and look to ensure any short-term downward price movement does not endanger trades. When monitoring short-term timeframes, key indicators continue to point towards a bullish trend. Moving Averages indicate the buy signals are likely to remain for as long as the price remains above the $4,802-$4,817 levels. Buy signals will particularly strengthen if the price rises above $4,866.

How To Trade Gold Webinar Registration Here!

• Gold has hit record highs, rising nearly 6% this week and over 12% year-to-date.
• Geopolitical tensions around Greenland, NATO, and Trump’s Davos speech are driving safe-haven demand.
• Rising US and Japanese bond yields, alongside expected future rate cuts, are supporting Gold.
• Weak stock markets and dim corporate outlooks are increasing investor demand for gold.
• Gold remains in a strong bullish trend but is showing overbought signals that traders are not yet concerned about due to recent price drivers.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

 

[HFM]

Date: 26th January 2026.

Are the US Eying A Weaker USD?

The US Dollar Index has seen its strongest decline in eight months and has fallen to its lowest since September 2025. The downward price movement is due to threats of new tariffs on key trade partners, including the EU and Canada, as well as intervention talks between corporations to boost the Japanese Yen.

A key question during the elections which is now resurfacing is whether the US is aiming for a weaker Dollar. The US president has been clear that he is looking to bring back manufacturing to the US. Countries looking to boost manufacturing and exports tend to benefit from a weaker currency, such as China, Japan and Korea.

The Japanese Yen saw two major price movements, the first on Friday where the price rose 1.99% and another on Monday increasing a further 1.15%. The USDJPY is now trading at its lowest level since November 2025. The Japanese Government has intervened into the currency exchange on four occasions over the past three years.

The Japanese government does not confirm if a price movement is due to intervention once it happens. However, government officials have been signalling intervention was imminent if the price did not quickly move in favour of the Yen.

Investors should note that the decline in the USDJPY is causing the value of the US Dollar to decline in general. In the past week, the Japanese Finance Minister Mr Katayama, and the US Treasury Secretary, Mr Bessent have made comments about supporting the Yen against the US Dollar. For many investors watching the Dollar, signs that the US is willing to support a stronger Yen revive talk of coordinated action to push the US Dollar lower. As a result, the US Dollar is declining against all currencies as this move hurts sentiment towards the currency.

The US Dollar is the worst performing currency of today and this year so far. The best performing currencies have been the Australian Dollar, New Zealand Dollar and Japanese Yen. Strategists also note that these three currencies are at a low risk from geopolitical tensions and tariffs.

The US over the past week has been the centre of both internal political crises as well as global ones. Investors are struggling to avoid pricing in the possibility of trade tariffs at some point in 2026. As a result, countries and institutions are limiting their exposure to the US Dollar.

Gold’s price moves are also another indication that investors expect the value of the US Dollar to decline in the medium to long term. On Monday, Gold rose above $5,000 for the first time and is up 10% over the past six days. A key price driver is US Dollar weakness and geopolitical tensions.

Funding expires on 30 January, and Congress has not yet passed a full budget or a new stopgap bill. As a result, investors are weighing the risk of another US Shutdown. This is another reason for the US Dollar’s decline and the upward price movement seen in metals. President Trump on Saturday threatened to impose 100% tariffs on Canada over that country's trade deal with China, even though he had previously called the agreement ‘a good thing’.

HFM - US Dollar Index Daily Chart

Even though the current price of the Dollar seems to be relatively low, the price remains higher than that seen before the COVID lockdowns. Nonetheless, the price remains below the five-year average price and slightly below the ten-year average.

Key support levels can be seen at 89.41, 91.89, and 94.55. Traders will expect the price to fall towards these levels if the currency remains under pressure. Trend-based indicators such as Moving Averages, Crossovers and the VWAP all indicate downward price movement. However, this will also depend on the Federal Reserve’s guidance on interest rates and the US budget developments.

The Federal Reserve is due to announce its interest rate decision on Wednesday evening at 19:00 GMT.

• Dollar Index hits eight-month low amid tariff threats and speculation of coordinated yen-support intervention.
• Yen surges sharply; USDJPY falls to November 2025 lows as intervention signals intensify.
• Comments from Katayama and Bessent fuel expectations of US-Japan coordination weakening the dollar.
• Geopolitical tensions, shutdown risk, and gold’s record rally reinforce bearish sentiment towards the US Dollar.
• Technical indicators point lower, with key Dollar Index support at 94.55, 91.89, and 89.41.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

 

[HFM]

Date: 27th January 2026.

AUD Rises on Hawkish RBA, Gold Prices and Strong Economy.

The Australian Dollar continues to be the best performing currency of 2026, rising by 3.70% so far. The Australian Dollar was also one of the best performing currencies of 2025 and rose against the US Dollar. In 2025, the Australian Dollar rose against the US Dollar for the first time in five years.

The Australian Dollar is primarily increasing in value for four key reasons:

• The Reserve Bank of Australia’s hawkish guidance
• Positive economic data
• Limited exposure to current geopolitical tensions, which are primarily impacting the US, EU, and UK.
• Gold, the US Dollar and AUD correlation.

Australia is due to announce its latest consumer price index (inflation rate) on Wednesday morning at 00:30 GMT. Analysts expect the CPI to rise from 3.4% to 3.5% which supports the Reserve Bank of Australia’s hawkish stance. The inflation rate comes at a critical time as the RBA is due to announce its interest rate decision next Tuesday (3 February).

If the inflation rate indeed rises from 3.4% to 3.5%, the RBA is likely to continue to indicate no interest rate cuts. Currently, analysts are contemplating whether the RBA will choose to increase interest rates or stick to a pause. Many economists and markets are now assigning a significant chance (around 50%) that the RBA will raise the cash rate by 0.25% at its 3 February meeting. This follows months of inflation pressure and strong labour market data.

If, however, the inflation rate increases above 3.5%, the possibility of an interest rate hike will significantly increase. In its latest press conference, the RBA governor, Michelle Bullock, told journalists that the central bank does not expect any interest rate cuts in the ‘foreseeable future’. The Commonwealth Bank and NAB expect the RBA to increase rates by 0.25%, whereas Westpac expects a pause.

Either way a key deciding factor will be tomorrow’s Consumer Price Index. If an interest rate adjustment becomes likely, the Australian Dollar is likely to rise. At the same time, if the RBA pauses but remains extremely hawkish for the future, again the AUD may find support.

Australia also benefits from its geographical location and limited direct exposure to current global geopolitical tensions. Unlike regions such as the US, Europe, and the UK, ongoing conflicts and trade disputes involve Australia less directly. Nonetheless, the country is still a member of the G20 and has a history of stability.

As global risks remain elevated, investors are increasingly seeking currencies linked to politically stable and lower-risk regions. This has supported demand for the Australian dollar, as it offers exposure to a developed economy with strong institutions while helping investors reduce their exposure to global geopolitical uncertainty.

In addition to this, Australia’s latest economic data release comes from the employment sector. The country’s unemployment rate fell from 4.3% to 4.1%, the lowest since June 2025. Furthermore, the employment sector added a further 65,000 employed individuals, beating expectations and recording the highest growth since May 2025.

Is Gold Supporting The Australian Dollar?

It has been well documented that the Trump administration may look to slowly lower the value of the US Dollar. The US Federal Government may look to do so in order to support manufacturing. In addition to this, many institutions and countries are looking to limit their risk involved with the turbulence in the US and the US Dollar.

Even though economists do not indicate any severe decline, most believe the administration prefers a slightly weaker Dollar. As a result, other currencies such as the Euro, Australian Dollar and Swiss Franc are finding support. However, the AUD is also finding support from the rise in Gold. Australia is the second-largest producer of Gold and fifth-largest for Silver.

Australian equities and commodity sectors (including gold miners) have been boosted by the gold rally, which can improve overall market sentiment towards Australia. Currently, this is supporting the AUD, but only if the RBA continues to remain hawkish.

HFM - AUDUSD Weekly Chart

In terms of technical analysis, AUDUSD is obtaining bullish trend signals from momentum-based indicators. However, the exchange rate is at a major resistance level at 0.69365. At the same time, the price remains at an overbought level on the RSIon the daily timeframe. As a result, investors should be cautious of retracements and limited bullish price movement.

However, trend-based indicators continue to point to a bullish trend in the medium to longer term. If the price returns above 0.69185, the bullish signals may again strengthen for short-term price action.

• The Australian Dollar leads currency performance in 2026, rising 3.7 per cent and continuing its 2025 strength.
• Its rise is supported by hawkish RBA guidance, strong economic data, gold correlation, and geopolitical stability.
• Australia will release the CPI on 28 January, potentially influencing the RBA’s 3 February interest rate decision.
• Low exposure to global conflicts and strong employment growth make the Australian Dollar attractive to investors.
• Technical analysis shows short-term bullish momentum, but resistance near 0.69365 and overbought RSI suggest possible retracements.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

 

[HFM]

Date: 28th January 2026.

Trump Embraces a Weaker US Dollar.

The US Dollar continues to decline as the market awaits the Federal Reserve’s interest rate decision. A decision not to adjust interest rates is almost certain, but investors will be hoping for more guidance on March’s decision.

However, the hawkish Federal Reserve is not supporting the US Dollar in any way. The US Dollar Index is trading at its lowest price since early 2022 and the President’s recent comments are fuelling poor sentiment towards the currency.

The decline in the US Dollar is consequently supporting Gold and Metal prices, while institutions increase exposure to the Swiss Franc, Australian Dollar and New Zealand Dollar.

The US is experiencing particularly strong economic data and a resilient employment sector. Inflation on the other hand remains above the Federal Reserve’s target but below most economists’ projections. Nonetheless, even with inflation remaining lower than expectations, the Federal Reserve is under no pressure to cut interest rates in the economy.

The Federal Reserve is likely to keep interest rates unchanged for the first quarter of 2026 in order to ensure inflation does not rise. The Fed is likely to cut on one occasion in the second quarter and another in the third quarter. However, the hawkishness of the Federal Reserve is not supporting the US Dollar.

The decline in the US Dollar is driven by questions over the independence of the Federal Reserve. Additional pressure comes from the upcoming appointment of a new chairman in May and the president’s embracing a weaker Dollar. Markets expect the new chairman to be more in line with the administration’s dovish stance. Overnight, the US President, Donald Trump, told investors that ‘I think the value of the Dollar is great’ and he would not be worried about the decline continuing.

Reports suggest the Trump administration could favour a gradual decline in the US Dollar to support manufacturing. At the same time, institutions and countries are working to reduce exposure to US volatility.

HFM - USDCHF Weekly Chart

The Swiss Franc is one of the best performing currencies of the day and is the third best of the year so far. Investors are increasing their exposure to the Swiss Franc due to its safe haven status. In addition, the Swiss Franc is less at risk of any backlashes from geopolitical issues. This is also supporting the price of the Australian and New Zealand Dollars.

The Australian Dollar continues to find support from positive economic data fuelling speculation of no interest rate cuts in 2026. This morning, the monthly Consumer Price Index rose from 0.0% to 1.0% and the inflation rate rose from 3.4% to 3.8%. As a result, the inflation rate remains unstable and may indicate the country’s monetary policy is not adequately restrictive.

Previously economists were placing the probability of a rate hike at 50%. Economists are yet to confirm their new projection after the latest inflation data. However, the chances of an interest rate hike have likely risen.

HFM - XAUUSD Weekly Chart

Gold’s price continues to increase for a seventh consecutive day and has already risen more than 20% this month. However, technical analysts are becoming increasingly cautious about an overbought price. The Federal Reserve is not likely to cut interest rates in this quarter, and the stock market continues to rise while the economy performs well.

The price of the US Dollar Index is retracing slightly higher after the recent dip. If the price continues to rise above 96.00, the chances of Gold retracing will also grow. In addition, the VIX index has fallen more than 1.50% this morning, indicating a risk-on appetite. This can also slightly pressure Gold in the short term.

• The US Dollar weakens as markets await Fed guidance despite rates likely remaining unchanged.
• Dollar sentiment is hurt by political pressure and doubts over Fed independence.
• A weaker Dollar boosts gold and metals; investors rotate into CHF, AUD and NZD.
• Swiss franc outperforms on safe-haven demand amid global volatility concerns.
• Rising Australian inflation strengthens AUD and raises interest rate hike expectations.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

 

[HFM]

Date: 29th January 2026.

US Dollar Slides on Shutdown Fears Despite Fed Pause.

The Federal Reserve chose not to adjust interest rates and gave no indication of a rate cut for March. In addition, the Federal Reserve Chairman told journalists that he believes the central bank will remain fully independent. The Federal Reserve’s moves can potentially support the US Dollar. Nonetheless, the US Dollar continues to decline.

After the US Dollar Index retraced to 96.60, the currency fell by 0.80%, particularly after the Fed’s press conference. Why are investors continuing to short the US Dollar?

Even though the US Dollar is declining on Thursday and has come under pressure since the Fed’s press conference, it is not falling to a new low. The price has remained above its recent lows despite the pressure. The price remains 0.50% higher than yesterday’s low. The US Dollar Index is increasing as we edge closer to the European session open. However, the index must rise above 96.12 in order to start to obtain clear potential buy signals.

HFM - US Dollar Index 12-Hour Chart


The worst performing currencies of the day so far are the US Dollar and the Japanese Yen. The best performing currencies are again the Australian Dollar and New Zealand Dollar.

The US Dollar’s decline is not necessarily due to the Federal Reserve or monetary policy. Investors are shorting the US Dollar as they look to distance themselves from geopolitical tensions and a potential US shutdown. In addition, investors are negatively reacting to the US coordinating with the Japanese government regarding boosting the Japanese Yen. Investors tend to negatively view interventions into the currency market.

The current US budget is due to expire on 30 January. US President Donald Trump and Senate Democratic leader Chuck Schumer are reportedly negotiating on the new budget.

To avert a shutdown, the US administration is looking to separate the Department of Homeland Security (DHS) funding from a larger spending package. However, the Democrats are likely to add reforms to Immigration and Customs Enforcement (ICE). This could potentially be a key sticking point.

Many Democrats propose mandatory body cameras for agents, restrictions on mask use, tighter use-of-force standards, and independent oversight of alleged abuses. These measures are driven by recent controversies involving immigration agents and have emerged as the central obstacle in the negotiations.

According to analysts, there is a 70% chance of a US shutdown. A US shutdown could potentially pressure the US Dollar and sentiment further.

The key takeaways from the Federal Reserve’s press conference from Wednesday evening are comments on the economy and future rate adjustments. The Chairman of the Fed, Jerome Powell, advised economic activity is expanding at a solid pace and the employment sector shows signs of stabilising.

However, Mr Powell also advises inflation remains above its target and does not show signs of stabilizing below 2.5%. As a result, the Federal Reserve is not likely to cut interest rates easily according to the Chairman.

The Federal Open Market Committee is largely supporting a pause, with only two members voting for an interest rate cut. In addition, Powell indicated that it’s unlikely the next policy move will be a rate increase.

Earlier, US President Donald Trump commented on movements in the US Dollar, saying he was unconcerned about the sharp decline that has pushed the currency back to four-year lows. He added that he currently prefers to let the market determine a ‘fair value’ for the Dollar.

Investors interpreted this stance as a sign of continued market-driven pricing, but it also heightened uncertainty, as the absence of verbal or direct support for the currency leaves it more sensitive to economic data, central bank decisions, and foreign policy developments.

• The Federal Reserve held rates steady, signalled no March cut, and emphasised independence, but the US Dollar continues to weaken.
• The Dollar’s decline is driven more by geopolitical risks, shutdown fears, and investor positioning than by Fed policy.
• A potential US government shutdown, with negotiations stalled over DHS and ICE reforms, is adding downside pressure to sentiment.
• President Trump’s hands-off stance on the Dollar has increased uncertainty, making the currency more sensitive to data and policy developments.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

 

[HFM]

Date: 30th January 2026.

Markets on Edge as Kevin Warsh Emerges as Fed Chair Frontrunner.

Gold and stocks decline as markets prepare for the US President, Donald Trump, to announce the new Federal Reserve chairman. Markets were previously expecting the President to announce the new chairman towards the end of next week. However, Trump shocked markets by announcing last night that he will announce the new Chairman this morning.

Since this announcement, the US stock market was quick to decline, as did Gold. A consequence of the shock announcement was a drop in the market’s risk appetite. This was the main reason for the stock market’s decline. However, why is the US Dollar increasing in value and Gold declining?

Analysts were expecting President Trump to nominate an ultra-dovish economist to head the Federal Reserve for the next four years. The market was not expecting any rate cuts from the Fed in the upcoming months. However, with the appointment of a new dovish chairman, investors were pricing in frequent cuts in the second half of the year.

The US President has said that he will confirm his nomination for the Federal Reserve chairman this afternoon. Many members of his party have said they believe it's better to wait for the announcement, but Trump does not seem willing. Yesterday afternoon, former Fed member, Kevin Warsh, was seen meeting at the White House. Political analysts and journalists believe Mr Warsh will be the President’s nominee.

According to Bloomberg, there is a 90% chance of Kevin Warsh being the Fed’s new chairman. Though many traders may be asking, why is this development prompting a stock market decline and weakness in Gold.

Markets expected a banker or economist with a traditionally dovish stance, but Kevin Warsh does not fit that profile. In the past, Warsh has established himself as a clear inflation hawk and has criticised the Federal Reserve for failing to bring inflation back to target. This was particularly the case under the Biden administration, where inflation rose to extreme highs.

In addition to this, the potential nominee is also known not to be a supporter of using quantitative easing, which is known to support the stock market. For this reason, markets do not see him as a clear dovish banker. Over the past few months, his tone has somewhat changed and at times has made dovish comments. However, judging by the market moves, investors have not forgotten his past.

Tom Tillis will not approve the nominee unless the US drops legal proceedings against Federal Reserve members. Trump is reportedly looking for a nominee who would reassure markets while also supporting his push for faster and deeper rate cuts. However, if his nomination does not get the backing required, uncertainties can create a lower risk appetite within the market.

HFM - XAUUSD 1-Hour Chart


Warsh has recently moved closer to the president’s stance, publicly advocating for lower interest rates despite his long-held reputation as an inflation hawk.

Currently, markets are pricing in a more hawkish outlook for the Federal Reserve or at least backtracking on previous projections. This can be seen in the price action of Gold, the US Dollar and Indices. Gold has fallen by 8.50% since the opening of the US session on Thursday. The stock market has also fallen with the S&P 500 trading almost 1.00% lower on Friday and all other indices also trading lower.

The US Dollar started the day with a bullish price gap measuring 0.30%, but has remained more or less stable since the open. Volatility is likely to continue as investors await the confirmation of Trump’s nominee. Traders also await the release of another key announcement, the US Producer Price Index.

• The surprise timing of the Fed chair announcement triggered risk-off sentiment, pressuring stocks and Gold.
• Markets fear a Kevin Warsh nomination due to his inflation-hawk stance and QE skepticism. Markets question whether Mr Warsh is indeed dovish.
• Hawkish repricing lifted the US Dollar while gold dropped sharply, down 8.5%.
• Political uncertainty and PPI data keep volatility elevated across equities, FX, and commodities.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

 

[HFM]

Date: 2nd February 2026.

Gold and Silver Prices Plunge as Dollar Rebounds | Market Briefing.

• Gold and silver prices suffered historic losses as speculative momentum unwound
• The US dollar staged a sharp rebound, catching bearish positioning off guard
• Global equities slid amid concerns over Fed independence and AI-driven valuations
• European data, particularly from Germany, continues to show consumer resilience
• FX and commodities volatility is now outpacing equities, signalling regime change

The sharp decline in gold and silver prices may look dramatic on price charts, but its broader economic significance remains limited. While some market narratives attempt to frame the sell-off as a reaction to shifting fundamentals, the evidence suggests something far more straightforward: the exhaustion of a fear-driven, momentum-heavy rally.

Gold and silver had surged at breakneck speed over a short period, leaving little time for meaningful wealth effects to materialise across the real economy. As a result, the correction arguably represents a healthy realignment toward prices more consistent with underlying economic conditions, reducing the risk of capital misallocation.

Gold extended losses after suffering its biggest plunge in more than a decade on Friday. Spot prices dropped as much as 10% on Monday and now sit nearly 20% below recent all-time highs. Silver fared even worse, slumping as much as 16% on Monday after registering its steepest intraday loss on record late last week. Year-to-date gains in silver were effectively erased in a matter of sessions.

Once pressure began to build, the move fed on itself. As Michael Brown, senior research strategist at Pepperstone, noted, multiple factors quickly added fuel to the fire, leaving markets asking not why the sell-off happened, but what comes next.

The sharp correction in precious metals sent shockwaves across FX markets, triggering a broad rebound in the US dollar. The greenback gained roughly 1% across Friday and Monday, marking its strongest short-term recovery since May.

The US dollar strengthened most aggressively against commodity-linked currencies, including the Australian dollar, New Zealand dollar and Norwegian krone, a logical reaction given their historical sensitivity to metals and energy prices.

This rebound caught many traders off guard. Short-dollar positioning had become one of the most crowded macro trades towards the end of January, fuelled by concerns over US deficits, political uncertainty and speculation around future Federal Reserve leadership.

However, sentiment shifted sharply following news that Kevin Warsh had been nominated as the next Federal Reserve chair. Markets interpreted Warsh as a more hawkish candidate than some alternatives, prompting a reassessment of rate expectations and triggering short-covering in the US dollar.

That said, few strategists believe the US dollar’s path forward will be smooth.

Despite the recent rebound, warnings about longer-term US dollar weakness remain widespread. Jeffrey Gundlach of DoubleLine Capital recently argued that the US dollar has failed to behave like a traditional haven currency, with political uncertainty and widening fiscal deficits continuing to weigh on sentiment.

‘This is not a volatility event. It is currency devaluation,’ said Ahmad Saidali of Redwood Heritage Group, referring to the US dollar’s decline over the past year.

Major institutions including Goldman Sachs, Manulife Investment Management and Eurizon SLJ Capital continue to forecast a weaker US currency over time, albeit with sharp counter-trend rallies along the way.

Goldman strategists highlighted a key development: FX volatility has surged to levels last seen in April, while equity and rates markets remain comparatively subdued. This divergence suggests currency markets may be the primary transmission channel for ongoing policy uncertainty.

Away from the volatility, European data offered a rare point of stability. German retail sales for December beat expectations, with prior months revised higher yet again. In fact, retail sales have been revised upward in 11 of the past 12 months.

European consumers continue to benefit from rising real incomes, and unlike some global peers, remain largely insulated from tariff-related price pressures. This consumer resilience has helped sustain trend-like growth across parts of the euro area, providing a counterbalance to external shocks.

Global equities moved sharply lower as February trading got underway. US equity futures declined, with the S&P 500 and Dow Jones futures falling over 1%, while Asian markets recorded steep losses. South Korea’s Kospi briefly halted trading amid extreme volatility before closing more than 5% lower. Tech heavyweights, including Samsung Electronics and SK Hynix, posted heavy losses as concerns grew over stretched AI-related valuations.

The selloff reflects growing unease over two key themes:

1. The sustainability of the AI-driven equity rally
2. The potential erosion of Federal Reserve independence under political pressure

Markets are increasingly sensitive to speculation that political influence could shape future monetary policy decisions, particularly if rate cuts are pushed aggressively despite inflation risks.

Oil prices also moved sharply lower. US crude fell below $63 per barrel, while Brent crude dropped to near $66. The decline followed comments suggesting renewed diplomatic engagement with Iran, easing fears of immediate supply disruptions in the Middle East.

As with metals, the move reflects a reduction in geopolitical risk premium rather than a deterioration in physical demand.

This market environment is not defined by a single crisis, but by rapid repricing across asset classes:

• Precious metals are correcting from speculative extremes
• FX volatility is rising faster than equity volatility
• The dollar remains structurally pressured but tactically unstable
• Equities are vulnerable to narrative shifts, particularly around AI and central banks

For traders, this backdrop favours flexibility, disciplined risk management and cross-market awareness. For investors, it reinforces the importance of understanding where price moves are driven by fundamentals, and where they are driven by positioning and sentiment.

As volatility migrates from equities to currencies and commodities, markets are signalling that the next phase will be less about momentum and more about policy credibility, valuation discipline and macro resilience.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Andria Pichidi
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.