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Canadian Dollar weakened broadly in early US session after inflation came in slightly below expectations. The data miss was modest, but enough to put the Loonie under pressure in otherwise quiet markets. The softer reading is not significant enough to force an immediate policy response from the BoC. Nor does it resolve concerns about sticky underlying inflation, with core measures still elevated.

Still, the lack of any resurgence in inflation allows policymakers to focus more squarely on risks to growth and employment. This backdrop could make it easier for the BoC to deliver another cut in September if incoming data — particularly on the labor market — shows further weakness.

In broader currency market, risk sentiment remains sluggish. Kiwi, Aussie, and Loonie are the weakest performers on the day so far, while Swiss Franc leads gains, followed by Euro and Yen. Sterling and Dollar are mixed in the middle of the pack.

That said, outside of a few Loonie and Aussie crosses, most major pairs remain trapped inside last week’s ranges. Trading conditions are subdued as investors avoid making large bets ahead of the Jackson Hole Symposium later in the week, where Fed commentary is expected to provide direction.

Looking forward, focus will first shifts to RBNZ’s policy decision in the coming Asian session. A 25bps cut to 3.00% is widely expected, but guidance will be key. Markets and economists remain split on whether the easing cycle ends here or if further cuts will follow into 2026. The tone of the statement will be scrutinized for clues on the next steps.

In Europe, at the time of writing, FTSE is up 0.34%. DAX is up 0.30%. CAC is up 1.05%. UK 10-year yield is down -0.007 at 4.736. Germany 10-year yield is up 0.004 at 2.771. Earlier in Asia, Nikkei fell -0.38%. Hong Kong HSI fell -0.21%. China Shanghai SSE fell -0.02%. Singapore Strait Times rose 0.69%. Japan 10-year JGB yield rose 0.026 to 1.597.

Canada CPI slows to 1.7% on gasoline drop, core still elevated

Canada’s headline CPI eased to 1.7% yoy in July, down from 1.9% yoy and below expectations for no change. The decline was driven by a sharp -16.1% yoy drop in gasoline prices, deepening from June’s -13.4% yoy. Excluding gasoline, CPI held steady at 2.5% yoy, in line with the prior two months. On a monthly basis, CPI rose 0.3% mom, matching forecasts.

Core measures delivered a mixed picture. CPI median ticked up to 3.1% yoy, as expected, while CPI trimmed held at 3.0% yoy. CPI common stayed at 2.6% yoy, a touch softer than anticipated rise to 2.7% yoy. Together, the readings show inflation has not accelerated, though underlying pressures remain sticky.

The figures reinforce the view that while headline inflation is cooling, the BoC cannot declare victory yet. Policymakers must weigh the relief from falling energy costs against stubborn core pressures. That balance will be crucial in shaping whether the Bank resumes easing at the September meeting or holds back to assess further data.

Australia's Westpac consumer sentiment hits 3.5-year high on RBA boost

Australian consumer confidence surged in August, with the Westpac index rising 5.7% mom to 98.5, the strongest reading since early 2022. Westpac attributed the rebound to RBA’s recent rate cuts, noting that a “long period of pessimism” among households may finally be drawing to a close. Consumers are less worried about their finances and more willing to take a cautiously positive view on the economy.

While policy easing is clearly helping, Westpac said the recovery is still fragile. Sustaining gains will likely require further RBA support, though there is no urgency to cut again at the September 29–30 meeting. With inflation well within the target range and unemployment low, the Board has room to wait and respond to incoming data.

On balance, Westpac expects RBA to hold steady in September before delivering another 25bp rate cut in November.

USD/CAD Mid-Day Outlook

Daily Pivots: (S1) 1.3780; (P) 1.3806; (R1) 1.3828; More...

USD/CAD rebounds further today but stays below 1.3878 resistance. Intraday bias remains neutral first. On the upside, firm break of 1.3878 will resume the corrective rebound from 1.3538 with another rising leg. Intraday bias will be back to the upside for 1.4014 cluster resistance (38.2% retracement of 1.4791 to 1.3538 at 1.4017). On the downside, though, below 1.3781 will turn bias to the downside to extend the fall from 1.3878 through 1.3720 support.

In the bigger picture, price actions from 1.4791 medium term top could either be a correction to rise from 1.2005 (2021 low), or trend reversal. In either case, further decline is expected as long as 1.4014 resistance holds. Next target is 61.8% retracement of 1.2005 (2021 low) to 1.4791 at 1.3069.

Canada’s headline CPI eased to 1.7% yoy in July, down from 1.9% yoy and below expectations for no change. The decline was driven by a sharp -16.1% yoy drop in gasoline prices, deepening from June’s -13.4% yoy. Excluding gasoline, CPI held steady at 2.5% yoy, in line with the prior two months. On a monthly basis, CPI rose 0.3% mom, matching forecasts.

Core measures delivered a mixed picture. CPI median ticked up to 3.1% yoy, as expected, while CPI trimmed held at 3.0% yoy. CPI common stayed at 2.6% yoy, a touch softer than anticipated rise to 2.7% yoy. Together, the readings show inflation has not accelerated, though underlying pressures remain sticky.

The figures reinforce the view that while headline inflation is cooling, the BoC cannot declare victory yet. Policymakers must weigh the relief from falling energy costs against stubborn core pressures. That balance will be crucial in shaping whether the Bank resumes easing at the September meeting or holds back to assess further data.

Full Canada's CPI release here.

AUDUSD remains in a sideways mode for the third straight day, with near term price action moving within a narrow daily cloud.

Upticks above cloud top (0.6512) were repeatedly capped by daily Kijun-sen (0.6522) that resulted in attack at cloud base (0.6474, also Fibo 61.8% of 0.6419/0.6568 upleg), which so far contained dips.

No clear direction signal expected while the price stays within the cloud, though strengthening positive momentum on daily chart, Stochastic about to emerge from oversold territory and converged daily Tenkan/Kijun-sen attempting to form a bull-cross, point to slight bullish alignment.

Bullish scenario sees break above cloud top and Kijun-sen, to open way for attack at 0.6568 (Aug 14 high) and possibly unmask 2025 peak (0.6625, posted on July 24)

Conversely, sustained break below cloud base would expose supports at 0.6450 (100DMA) and 0.6419 (Aug 1 low).

Res: 0.6512; 0.6522; 0.6568; 0.6595.
Sup: 0.6474; 0.6450; 0.6419; 0.6372.

Market Overview

The crypto market cap fell by another 0.4% to $3.87 trillion. The market is plunging below the former resistance level, raising speculators’ fears of a possible major correction towards $3.6 trillion.

Bitcoin fell to $114.7k, rolling back to levels seen two weeks ago and below the medium-term trend line, which is a 50-day moving average. This dynamic reinforces fears of a deeper correction, which could affect the entire crypto market, potentially triggering a deeper correction to $100K, near the 200-day MA.

Ethereum rolled back to $4,200, losing more than 12% from its peak. The second-largest coin by capitalisation seems to be seriously aiming to test the strength of the former resistance area near $4,100, which has been holding back price growth since March 2024. The ability to stay above this level will indicate a change in the market regime for this cryptocurrency. The abundant capital inflows also point to this.

News Background

According to CoinShares, global investment in crypto funds rose more than sixfold last week to $3.748 billion, the highest inflow in the last four weeks. Investments in Bitcoin increased by $552 million, Ethereum jumped by $2.868 million, Solana grew by $177 million, XRP by $126 million, and Sui by $11 million.

According to Glassnode, the number of addresses with a balance of more than 10,000 BTC fell to an annual low, and the number of wallets with 1,000–10,000 BTC also decreased. This indicates that large holders are taking profits after reaching record highs.

According to Canary Capital, Bitcoin is 50% likely to reach $140,000–$150,000 by the end of 2025, but a bear market will come next year.

Solana became the first network to reach 107,540 transactions per second (TPS) during a stress test. The actual throughput of the blockchain is lower, at around 3,700 TPS, which is 59 times higher than that of the main Ethereum network.

According to the XBR/USD chart, this morning (19 August) Brent crude oil price is showing bearish momentum, moving towards its lowest level since early summer (set last week). The key bearish drivers in the market include:

→ OPEC+ policy aimed at increasing production;

→ expectations that negotiations to end the war in Ukraine could lead to the lifting of sanctions on Russian oil exports, which would further expand global supply.

Technical Analysis of the XBR/USD Chart

In our analysis on 5 August, we noted that:

→ Brent crude had fallen to an important support level (marked in blue), which held throughout July;

→ a bearish breakout attempt below the blue support line was possible.

Indeed, in early August the price confirmed a bearish breakout of the blue line, accompanied by signs of rising volatility – the line subsequently reversed its role from support to resistance (as indicated by the arrows on the left-hand side of the chart).

Bears then consolidated their position, continuing to apply pressure and forming a downward channel (shown in red). The question now is whether Brent prices can continue their decline.

From a bullish perspective, there are grounds for demand to strengthen around the key support level at $65.00 (as indicated by the arrows on the right-hand side of the chart):

→ during an attempt to move lower, the chart formed a bullish harami reversal pattern;

→ this level acted as support following the bearish gap at this week’s market opening;
→ yesterday’s long lower shadow highlights aggressive buying activity.

From a bearish perspective, August’s downtrend remains intact – though it may be losing momentum. Note the RSI indicator, which is gradually leaning towards the 50 level (if bears were still firmly in control, it would remain closer to oversold territory).

This suggests that bulls may attempt to seize the initiative and challenge the upper boundary of the descending channel, seeking to offset at least part of Brent’s nearly 10% decline since late July. In this scenario, the $67.40 level – where bears previously demonstrated strong control – could become a critical test of demand resilience.

Tomorrow’s key releases could significantly influence price action: crude oil inventories (15:30 GMT+3) and the FOMC minutes (21:00 GMT+3).

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• GBPUSD faces low volatility but holds above 50-day SMA.
• Bearish short-term structure intact; bullish bias could emerge above 1.3655.

GBPUSD is trading quietly ahead of a busy UK data calendar, consolidating between the recent high of 1.3580 and the 50-day simple moving average (SMA) at 1.3500.

So far, August has been favorable for the pair, with the price climbing more than 3% from the low of 1.3139, largely driven by a weaker US dollar. Stronger-than-expected UK GDP growth figures failed to negate the bearish head-and-shoulders pattern, leaving attention now on upcoming CPI inflation, S&P Global business PMIs, and retail sales. These releases could provide fresh insight into whether a pause in the BoE’s rate-cut cycle is possible in the coming months.

Technical indicators suggest there is still some upside potential. The MACD is gradually strengthening in positive territory, while the RSI is holding above its neutral 50 mark. If the 50-day SMA holds firm, the pair may attempt a move higher towards the key resistance area at 1.3620–1.3655. A break above this zone could open the way for a retest of July’s high at 1.3740, with further gains targeting 1.3900–1.4000 or even 1.4070.

On the downside, a drop below 1.3500 could see the pair testing support between the 20-day SMA at 1.3425 and the broken resistance trendline near 1.3360. A decisive bearish move there could drive the price down to August’s low of 1.3139. Below that, the 200-day SMA at 1.3000 would come into focus.

In summary, while technical signals point to some buying interest, GBPUSD will need to invalidate the short-term bearish structure with a move above 1.3655 to strengthen market confidence.

Ethereum completed its cycle from the August 2025 low, forming wave 1 through a five-wave impulse structure. Starting from the August 3, 2025 low, wave ((i)) peaked at $3,737.4, followed by a pullback in wave ((ii)) to $3,545.2. The cryptocurrency then surged in wave ((iii)) to $4,332.7, with a subsequent dip in wave ((iv)) concluding at $4,165.5. The final leg, wave ((v)), reached $4,791.5, finalizing wave 1 in a higher degree. This upward movement reflects Ethereum’s strong bullish momentum during this phase.

Currently, a corrective wave 2 is unfolding as a double three Elliott Wave structure. From the wave 1 peak, wave (a) declined to $4,455, and wave (b) rallied to $4,706.4. Ethereum then dropped in wave (c) to $4,370.9, completing wave ((w)) in a higher degree. A subsequent rally in wave ((x)) peaked at $4,578.1. From there, wave (a) fell to $4,228.8, and wave (b) climbed to $4,390. The ongoing wave (c) of ((y)) is expected to push Ethereum lower, targeting the $3,895–$4,156.2 range, which aligns with the 100%–161.8% Fibonacci extension of wave ((w)). From this zone, Ethereum could resume its upward trend or stage at least a three-wave bounce, signaling potential bullish continuation.

Ethereum (ETHUSD) – 60 Minute Elliott Wave Technical Chart:

ETHUSD – Elliott Wave Technical Video:

https://www.youtube.com/watch?v=bb2mUYeOUhg

On Tuesday, the price of gold stabilised around USD 3,330 per troy ounce. Investors are assessing US-led peace efforts and awaiting the outcome of the Federal Reserve’s annual Jackson Hole symposium.

Following Monday’s meeting at the White House, US President Donald Trump confirmed that he had discussed the situation with Russia and was now working on arranging direct talks with three presidents.

These developments sparked hopes of a possible peace deal, although market participants remain cautious and do not expect a quick resolution.

Traders are also focusing on the upcoming speech by Fed Chairman Jerome Powell in Wyoming. The market is waiting for signals regarding a potential resumption of interest rate cuts in September.

The baseline scenario still anticipates one rate cut at the September meeting, followed by another small easing by year-end, likely limited to 25 basis points.

Technical analysis of XAUUSD

On the H4 chart of XAUUSD, the market continues to develop a wide consolidation range around the 3,333 level. The price has extended the range upwards to 3,357 and downwards to 3,322. Today, a breakout below this range towards 3,296 is possible. Afterwards, a correction to 3,333 may occur, followed by a decline to 3,263. The formation of a downward wave towards 3,250 is practically under consideration. This scenario is technically supported by the MACD indicator, whose signal line is below zero and pointing strictly downwards, confirming bearish momentum.

On the H1 chart, XAUUSD completed a downward impulse to 3,333 and is forming a consolidation range around this level. The third wave of decline is unfolding, targeting 3,297, with a likely continuation of the trend to 3,260. The Stochastic oscillator confirms this setup: its signal line is near the 80 level and preparing to drop towards 20, indicating growing downside pressure.

Summary

Gold is holding above USD 3,330 as geopolitical tensions and Jackson Hole expectations dominate sentiment. Technical indicators support the development of a downward wave with key targets at 3,296, 3,263, and potentially 3,250, while short-term consolidation remains around the 3,333 level.

Daily Pivots: (S1) 199.27; (P) 199.77; (R1) 200.17; More...

Intraday bias in GBP/JPY remains neutral and more consolidations could be seen below 200.26. But in case of another fall, downside should be contained well above 195.01 support. On the upside, firm break of 200.26 will resume the whole rise from 184.35 to 100% projection of 180.00 to 199.79 from 184.35 at 204.14.

In the bigger picture, price actions from 208.09 (2024 high) are seen as a correction to rally from 123.94 (2020 low). The pattern might still extend with another falling leg. But in that case, strong support should be seen from 38.2% retracement of 123.94 to 208.09 at 175.94 to contain downside. Meanwhile, decisive break of 208.09 will confirm long term up trend resumption.

Daily Pivots: (S1) 172.09; (P) 172.38; (R1) 172.71; More...

Intraday bias in EUR/JPY stays neutral at this point. Corrective pattern from 173.87 is still extending, and break of 170.94 will bring deeper fall to 169.69 support. But downside should be contained by 38.2% retracement of 161.06 to 173.87 at 168.97 to bring rebound. On the upside, above 172.99 will bring retest of 173.87.

In the bigger picture, considering current strong momentum as seen in the rally from 154.77, corrective pattern from 175.41 could have already completed. Decisive break of 154.77 will confirm long term up trend resumption. Next target is 61.8% projection of 124.37 to 175.41 from 154.77 at 186.31. However, rejection by 175.41, followed by firm break of 55 D EMA (now at 169.95) will delay this bullish case.