Gold Prices and US Treasury Yields<\/p>\n
The labor market remains tight, with continuing jobless claims staying below the two million mark, a figure we haven’t consistently seen since the pre-pandemic era. This strength, combined with inflation, reinforces the case for a hawkish Fed at its upcoming September meeting. Therefore, we see continued headwinds for assets that are sensitive to interest rates.<\/p>\n
Gold is struggling to break out, even with high inflation, because the 10-year Treasury yield is creeping back toward 5.0%. As long as the US Dollar and yields remain firm, we believe gold’s upside is limited around the $3,350 mark. Selling call options above $3,400 could be a viable strategy to generate income in this range-bound environment.<\/p>\n
Cryptocurrency Market Volatility<\/p>\n
In the cryptocurrency market, we see significant volatility after Bitcoin’s recent peak. Implied volatility on Bitcoin options has jumped to nearly 85%, reflecting uncertainty after the correction from its all-time high. We should consider strategies like options straddles, which can profit from large price swings in either direction, rather than betting on a specific trend.<\/p>\n
The threat of escalating trade tensions adds a layer of risk to the entire market. A potential 0.7 percentage point hit to global output is a serious concern that could trigger a sell-off in equities. We should think about buying protective put options on major indices like the S&P 500 as a form of portfolio insurance.<\/p>\n
Given these crosscurrents, we must manage our use of leverage carefully. The current environment presents opportunities but also significant risks of sharp reversals. We should focus on defined-risk strategies, such as buying puts or calls, to ensure we do not risk more capital than we can afford to lose.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" US jobless claims dip; Dollar gains strength; Gold steady; Bitcoin corrects; Trade tensions may escalate.<\/p>\n","protected":false},"author":62,"featured_media":16963,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-29115","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/29115","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=29115"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/29115\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media\/16963"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=29115"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=29115"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=29115"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}