This week, developments between Russia and the US have caught the attention of global markets. Notably, Putin has expressed support for Trump, which has shifted the geopolitical landscape. A report from Axios revealed that a US-Ukraine minerals deal is nearing completion, which may have significant implications for the market. Treasury Secretary Bessent mentioned that both sides are “on the 1-yard line” regarding the deal. Soon after, Trump indicated that a resolution for the Ukraine-Russian war could be on the horizon, which has generated some optimism in the market.
Putin later commented on the deal, stating that while it is “none of his business,” he is open to cooperation on rare earth metals and aluminum. He also recognized Trump’s approach toward improving Ukraine’s political climate, aligning more with Ukraine’s survival interests than with Russia’s. Looking forward, discussions between the US and Russia will focus on defense budgets and potential joint economic projects, potentially reshaping market dynamics.
As US-Russia relations improve, there’s a noticeable shift away from China, which may affect gold and silver prices and increase the Dollar’s strength. Despite rising hopes for a peace deal between Russia and Ukraine, the Euro and GBP are not expected to outperform the Dollar’s growth.
Market Analysis: Gold, Silver, and Currency Trends
Gold
Gold prices continue to hover near historic highs, fueled by ongoing geopolitical tensions. Price action shows strong buying momentum, but the MACD is nearing a crossover, indicating a brief retraction before a possible new record high. Traders focusing on compounding forex profits might consider a temporary pullback as a potential opportunity.
Silver
Despite Gold’s surge, Silver remains relatively stagnant. The RSI indicates overbought conditions, while the MACD is showing signs of upward movement. However, Silver prices may remain low until clearer signals emerge, potentially indicating short-term bearish conditions.
DXY (US Dollar Index)
The Dollar saw a rise after Trump’s comments about tariffs on Mexico and Canada. While the market remains in a consolidation phase, the MACD suggests potential bearish trends ahead. However, the RSI indicates overbought conditions, and a price action forecasting approach suggests that we could see a continuation of the Dollar’s strength, especially if the FED delays rate cuts due to the tariff issues.
Major and Minor Currency Pairs
GBP/USD
The Pound is showing signs of a potential decline, currently trading at 1.26163. The RSI signals exaggerated selling momentum, though there’s potential for a temporary upward cross before the downtrend resumes. Short-term forex gains could be taken advantage of during price fluctuations.
AUD/USD
The Aussie Dollar is facing downward pressure due to the Dollar’s strength. The 0.63407 level is currently holding prices up, but increased selling momentum from both the MACD and RSI suggests further declines. Hedging with multiple currencies may help mitigate risks in this market.
NZD/USD
The Kiwi Dollar remains supported above key levels but faces growing selling momentum. The MACD shows increasing selling volume, signaling further downside movement if US Dollar bullishness continues.
EUR/USD
The Euro and GBP may see increased appeal due to potential Russia-Ukraine peace talks; however, both currencies are still expected to fall short of Dollar growth. Price action forecasting suggests a potential short-term rise, though caution is warranted.
USD/JPY
The Yen is experiencing increased selling momentum, with MACD yet to cross under but signs of continued bearish movement. Market participants should consider volatility breakout trading strategies in this environment.
USD/CHF
The Swiss Franc is consolidating between key levels, with MACD and RSI indicating slight downward pressure. Traders should monitor for clearer signals before making moves.
Commitment of Traders (COT) Reports Analysis
| Currency | Strength Rating (Out of 5) |
| AUD | WEAK (3/5) |
| GBP | WEAK (1/5) |
| CAD | WEAK (4/5) |
| EUR | WEAK (3/5) |
| JPY | STRONG (5/5) |
| CHF | WEAK (5/5) |
| USD | STRONG (5/5) |
| NZD | WEAK (5/5) |
| GOLD | STRONG (4/5) |
| SILVER | STRONG (5/5) |
Conclusion: Key Market Drivers and Forex Strategy
- US-Russia developments are shifting the market focus, with Dollar strength likely to continue as geopolitical tensions ease.
- Gold and Silver remain pivotal commodities to watch, with GOLD’s appeal potentially waning in favor of the Dollar.
- Major and minor currency pairs are under significant influence from geopolitical news, and price action forecasting points to Dollar growth over other currencies.
- For traders, compounding forex profits strategies can be adapted to volatile conditions, while advanced forex strategies should focus on short-term forex gains in response to these shifts.
