Solid Goold Trading

Monday’s Edition

With Nick Goold

It was a relatively quiet week for markets during the middle of the summer trading period. U.S. inflation was the main focus, with CPI in line with expectations and PPI slightly below expectations. The softer inflation data reduced expectations for higher U.S. interest rates, with markets pricing around a 32% chance of a Fed rate hike in September, down from around 52% earlier in the week.

U.S. consumer data was more concerning. Retail sales and consumer sentiment were both weaker than expected, with retail sales falling 0.6% in July, the biggest monthly decline since May 2025. USD/JPY moved higher early in the week as buyers returned and concerns about another Japanese intervention eased. U.S. stocks finished the week close to flat, while Japanese stocks continued to recover.

Speculation also increased that the Bank of Japan could raise interest rates as early as September. Meanwhile, WTI crude oil moved higher again as tensions in the Middle East continued, keeping concerns about possible supply disruptions through the Strait of Hormuz in focus.

Markets This Week

U.S. Stocks

The Dow had a quiet week, moving slightly lower as weaker-than-expected U.S. economic growth and consumer sentiment weighed on stocks. The weekly close below the 10-day moving average suggests the short-term trend has weakened, with further downside possible in the week ahead. Resistance levels are at 54,500, 55,000 and 56,000. Support is seen at 53,000, 52,500, 51,500, 51,000 and 50,000.

Japanese Stocks

A weaker yen and continued buying of AI-related stocks helped the Nikkei continue its recovery last week. The market looks slightly overbought in the short term, so traders may look for selling opportunities early this week. Medium-term traders could wait for a pullback to the 10-day moving average before looking to buy. Resistance is at 69,500, 70,000 and 71,000. Support is at 67,000, 66,000, 65,000, 64,000 and 63,000.

USD/JPY

USD/JPY continued its recent recovery, starting last week strongly as buyers became more active as WTI crude oil moved higher. However, slightly weaker-than-expected U.S. inflation data and growing expectations of a Japanese interest rate increase in September limited further gains. The 10-day moving average has now turned higher and is providing support, so buying on weakness may be the preferred strategy this week. Resistance is at 160.00, 161.00, 162.00, 164.00 and 165.00, while support is at 158.50, 158,00, 157.00, 156.00, 155.00 and 154.00.

Gold

Gold continued to move higher last week as expectations for a U.S. interest rate increase fell following weaker-than-expected economic data. The outlook for gold remains positive, but after the recent strong gains, both short- and medium-term traders may prefer to wait for a pullback toward the rising 10-day moving average before buying. Resistance is at $4,400, $4,450, $4,500 and $4,600, while support is at $4,200, $4,150, $4,050, $4,000 and $3,950.

Crude Oil

WTI crude oil started the week strongly as tensions between the U.S. and Iran increased over the weekend. Oil continued to rise through the week as Trump introduced new economic sanctions against Iran to pressure the country to end the war. With little progress in reducing tensions, sideways to higher oil prices look likely this week. Resistance is at $75, $80, $90, $95 and $100, while support is at $75, $67.50, $65 and $60.

Bitcoin

After failing again at the $65,000 resistance level early last week, Bitcoin remained under pressure and slowly moved toward the monthly lows. The market remains quiet as trading interest is low, so a large move may be unlikely this week. A range-trading strategy could be preferred, selling above $64,000 and buying around $62,000. Resistance is at $65,000, $75,000, $80,000, $85,000, and $90,000, while support is at $62,000, $60,000, $55,000 and $50,000.

This Week’s Focus

Monday: Japan GDP and Industrial Production, China Industrial Production, Unemployment Rate and Retail Sales, U.S. NY Empire State Manufacturing Index
Tuesday: U.K. Unemployment Rate, E.U. ZEW Economic Sentiment, U.S. Housing Starts and Industrial Production
Wednesday: U.K. CPI, E.U. CPI, U.S. FOMC Meeting Minutes
Thursday: Japan Trade Balance, Australia Unemployment Rate, U.S. Philadelphia Fed Manufacturing Index and US Leading Index
Friday: Japan National Core CPI and S&P Global Services PMI, U.K. Retail Sales, E.U. HCOB Eurozone Manufacturing PMI, U.K. S&P Global Manufacturing PMI, U.S. S&P Global Manufacturing PMI

While there are relatively few major U.S. economic releases this week, markets will remain focused on developments in the Middle East as efforts continue to restore oil supplies from the region. Any further disruption could push oil prices higher and add to inflation concerns. The FOMC meeting minutes will also be closely watched, especially as market expectations for a possible Fed rate hike in September have changed in recent weeks.