The week’s agenda centres on the RBA meeting minutes at 01:30 GMT on Tuesday, before US core PCE at 12:30 GMT on Wednesday, which is forecast at 0.1% m/m for July. On the same day, the second estimate of US GDP for Q2 2026 is expected to ease to 1.5% from 2.1%. Friday brings Canadian GDP for Q2 at 13:30 GMT, with the annual rate seen improving from -0.1% to 3.4% and the quarterly measure rising from 0.0% to 0.8%; Federal Reserve Chair Kevin Warsh then speaks at Jackson Hole at 14:00 GMT.
USOIL slipped after two weeks of gains, even as it is up more than 50% year-to-date, with attention on a US plan to economically isolate Iran and continued disruption risks around the Strait of Hormuz, Bab el-Mandeb and Black Sea routes. Demand pressures were flagged by Sinopec, citing nearly an 8% fall in first-half gasoline consumption and a 12% drop in diesel use. Technically, oil is above the 50-day and 100-day SMAs, testing the 23.6% Fibonacci near $85, with overbought Stochastic signals and the upper Bollinger Band around $88; levels in view include $88–90, with support near $82 and $79. XAUUSD rose to a more than three-month high above $4,650/oz, after US Treasury intervention pushed yields and the dollar lower, while gold-backed ETFs saw their strongest weekly inflows since January and Dalio referenced up to 15% in gold; price has cleared the 38.2% Fibonacci at $4,488, is testing the 50% near $4,649, and could extend to $4,810 or retreat towards $4,490.
Central Bank Updates and Macro Market Drivers
We are entering a highly volatile week for global markets as key central bank updates and economic growth data prepare to test current asset valuations. On Wednesday, the US Core PCE index and the second estimate for Q2 GDP—which is expected to slow to 1.5% from 2.1%—will likely dictate the near-term direction of the US Dollar. We should also prepare for high volatility on Friday when Federal Reserve Chair Kevin Warsh speaks at the Jackson Hole symposium, which historically triggers sharp swings in yield-sensitive assets.
Looking back at historical rate cycles, a slowing GDP coupled with cooling inflation readings typically forces central banks toward a more accommodative policy stance. Recent data shows that Treasury yields have already begun easing following recent government interventions in the bond market, boosting non-yielding assets. If this week’s PCE inflation matches the projected 0.1% monthly rise, we expect further downward pressure on the greenback, offering a prime setup for counter-dollar trades.
Commodity and Currency Technical Outlook
In the energy markets, we are watching USOIL closely as geopolitical tensions from the US-Iran conflict keep global supply lines heavily restricted. Despite a massive 50% year-to-date gain driven by shipping bottlenecks in the Strait of Hormuz, crude demand is showing signs of cracking, with China’s Sinopec reporting a massive 12% drop in diesel use. Technically, oil is testing the 23.6% Fibonacci retracement near $85, but with overbought momentum indicators, we should watch for a potential pullback toward $82 before attempting to buy any breakout toward $90.
Gold has surged to over $4,650 per ounce, fueled by massive inflows into gold-backed ETFs and rising fears of currency debasement. While prominent investors are urging up to a 15% allocation to gold as a hedge against sovereign debt risks, the metal is currently trading in a deeply overbought technical zone. We suggest monitoring the key resistance level at $4,649; a clean break above this could pave the way to $4,810, whereas a rejection makes a temporary dip back to $4,490 highly probable.
We also see a major short-term trading opportunity in the Canadian Dollar ahead of Friday’s Q2 GDP release, which is expected to rebound sharply to 3.4% annually from a previous contraction of -0.1%. A strong economic reading here could quickly strengthen the Loonie, especially when paired against a weakening US Dollar. Additionally, we must monitor the Reserve Bank of Australia’s meeting minutes early in the week to gauge potential volatility spikes in AUD pairs.
