Session Overview

The Asian session carried a mixed but broadly risk-on equity tone, with Australian and Japanese benchmarks advancing sharply while the AUD and NZD complex softened following local inflation data. Crypto and higher-beta altcoins traded broadly lower amid extreme volatility readings. Overall character was event-driven, with positioning building ahead of today's US Core PCE release.

Key Moves

  • AUS200: Up +1.13% to 8,803.9. Australian equities advanced following the release of local CPI data, with instrument momentum reading extreme bullish.
  • JP225: Up +1.03% to 66,805.0. Japanese equities extended gains, supported by extreme bullish instrument momentum.
  • LNKUSD: Down -2.58% to 14.289. Chainlink led crypto losses amid extreme volatility and bearish daily momentum.
  • UNIUSD: Down -1.84% to 8.7985 amid extreme volatility and mixed daily momentum.
  • AUDUSD: Down -0.23% to 0.69697, extending a two-session bearish streak, with an active sell signal currently building unrealized risk.

Notable Signals

The USDCHF buy signal continues to perform well, now at +1.06R with a maximum favorable excursion of 1.3R since entry near 0.82928, confidence 0.76. The USDCAD buy (confidence 0.85, quality 7.5) is modestly in profit at +0.3R. Conversely, the EURJPY sell (confidence 0.82) and AUDUSD sell (confidence 0.8) sit at -0.28R and -0.08R respectively, and EURCHF buy is at -0.21R. Current exposure is concentrated on USD direction across USDCHF, USDCAD, EURUSD and AUDUSD.

Risk Sentiment

Broad USD strength persists across major pairs ahead of the Core PCE release, consistent with a synchronized rather than pair-specific driver. Gold (XAUUSD) is little changed near 4,178.81 despite an extreme bullish daily momentum reading, an unusual divergence given the firmer dollar tone. Asian equity indices are broadly higher, pointing to a risk-on undertone in that asset class, while AUD and NZD remain soft against most crosses. Currency strength readings show GBP outperforming and AUD lagging across the forex complex.

Outlook

Attention now turns to the Core PCE Price Index and Final GDP q/q releases, both high-impact events due later in the session. With USD positioning already concentrated across four major pairs, price action into the next session may be sensitive to any deviation from the 0.3% Core PCE forecast. Gold's quiet, low-volatility posture against its underlying bullish momentum reading is worth watching for a potential breakout once the data lands.