Gold Prices Decline

In cryptocurrencies, Ripple (XRP) demonstrated a short-term bullish trend toward the $3.00 mark. This movement comes as global geopolitical tensions ease after recent events in the Middle East.

Chinese data from May presented mixed results, with robust retail sales but weaker fixed-asset investments and property prices. However, the data suggests the country’s economic growth is on track to meet 2025 targets.

The figures from Canada, particularly the sharp increase in housing starts compared to expectations, indicate that domestic construction activity is gathering pace even as broader indicators remain under pressure. The number at 279.5K, versus forecasts of 248K, tells us that developers and contractors exhibit confidence in forward demand. For traders dealing in interest rate-sensitive assets or housing-linked derivatives, this reinforced growth could mean upward pressure on yields within the Canadian market in the short term. If this trajectory continues, we may also see shifts in expectations around domestic monetary policy, which, in turn, affect directional bets on the Canadian Dollar and related swaps or futures.

Australian Dollar and External Factors

Meanwhile, the rebound in the Australian Dollar appears to have gained traction not from internal data but rather from external factors, chiefly a weakening US Dollar and broader uplift across risk assets. The break above 0.6500, followed by movement up to 0.6550, all unfolded as US yields stabilised and sentiment improved. Traders should note that this is less about firm support in economic data from Australia and more about short-term positioning flows and dollar softness. The persistence of this trend may depend on upcoming speeches from Fed officials or surprise updates in macro releases, particularly those tied to inflation and consumer spending. Positions held in FX options or volatility-based AUD products would need to be adjusted if we see reversal signs from either side.

The Euro’s strength against the Dollar, observed by the pair pushing past 1.1600, aligns with wider risk asset recovery. It can’t be assumed that this is purely on the back of European performance; rather, it showcases how the dollar’s correction is nudging currency markets. For us, that gives rise to an environment where short-dated calls or spreads tied to EUR/USD may outperform, especially if paired against staggered trades with less volatile crosses. Treasury auctions or minutes from central banks could add fresh momentum to this pair, so staying close to economic calendars is wise.

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