Singapore’s foreign reserves increased to 417 billion in January compared to 409.3 billion. This data contributes to the market’s understanding of economic trends and decisions.
Gold retains its value, staying above $5,000 after substantial gains. The People’s Bank of China continues its gold buying, aligning with expectations about US Fed’s policy affecting the dollar.
Currency Market Movements
The EUR/USD pair maintains strong gains above 1.1850 due to a weaker US Dollar. GBP/USD trades near 1.3610 amidst political instability in the UK, which may influence currency movement.
Cryptocurrencies such as Bitcoin, Ethereum, and Ripple exhibit consolidation after notable corrections. Bitcoin remains around $70,000, while Ethereum and Ripple face key resistance levels.
Forex brokers are evaluated for 2026, focusing on various aspects like low spreads, high leverage, and specific geographical advantages. These assessments aid traders in making informed broker choices.
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US Dollar Weakness
Given the persistent weakness in the US Dollar, we believe positioning for further downside is the primary strategy for the coming weeks. The critical US employment report on Wednesday is the next major catalyst, with consensus expecting a soft print of around 150,000 jobs added. Any number below this would likely accelerate the dollar’s decline, making short-dated put options on the US Dollar Index (DXY) an attractive hedge.
The trend in Gold is exceptionally strong, and we see no reason to fight it while it holds above the $5,000 level. Central banks have provided immense support, having added a record of over 1,000 tonnes to their reserves in 2025, a pace that appears to be continuing. Traders should consider buying call options on XAU/USD or using bull call spreads to limit costs while maintaining upside exposure.
With the Euro trading firmly above 1.1850, it is the clearest beneficiary of the weak dollar narrative. We anticipate this strength will continue, especially if upcoming speeches from Fed officials maintain a dovish tone. Long positions via EUR/USD futures or call options targeting the 1.2000 psychological level seem appropriate for this environment.
Sterling’s inability to capitalize on the weak dollar highlights its own domestic issues, creating a compelling cross-currency opportunity. The ongoing UK government crisis is weighing on the Pound, similar to how political instability in 2022 caused it to underperform. We see a clear trade in going long EUR/GBP, using derivatives to profit from the Euro’s relative strength against the Pound.
The new political mandate in Japan suggests a significant policy shift could be on the horizon, which would be bullish for the Yen. This is a longer-term theme, but volatility in USD/JPY is likely to increase as speculation mounts. Buying long-dated put options on USD/JPY offers a way to position for a potential strengthening of the Yen over the next several months.
