XAU/USD – Daily Chart
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Forex Signals Brief for Aug 12: USD Gains Pre-CPI as Markets Eye Fed’s Next Move
Today attention will be on the US CPI inflation numbers, however we had a rate cut from the RBA already and the UK employment report.vjh
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Last updated: Monday, August 11, 2025
Quick overview
- The US dollar strengthened ahead of the CPI inflation numbers, with traders anticipating stronger-than-expected data.
- The Reserve Bank of Australia is expected to cut interest rates by 25 basis points next week, according to market pricing.
- US equities closed modestly lower, with the Dow down 0.45% and the Nasdaq falling 0.50%.
- Bitcoin attempted to retest highs above $122K but ultimately closed below $120K, while Ethereum reached its highest level since 2021.
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MARKETS TREND
Today attention will be on the US CPI inflation numbers, however we had a rate cut from the RBA already and the UK employment report.
Dollar Strengthens on Inflation Speculation
The US dollar closed higher against major currencies yesterday as traders positioned ahead of the upcoming CPI release, amid hints that the data could come in stronger than expected. President Trump, speaking from Washington, announced that China would receive another 90-day reprieve from additional tariffs. He also noted progress in peace talks between Russia and Ukraine, saying a preliminary “feel-out” meeting with President Vladimir Putin later this week could pave the way for a direct meeting between Putin and President Zelenskiy to declare a truce.
US equities gave up earlier gains to finish modestly lower, with the Dow down 0.45%, the S&P 500 off 0.25%, and the Nasdaq falling 0.50%.
Key Market Events for Today
RBA Central Bank Outlook
In money markets, traders are pricing in a 98% probability that the Reserve Bank of Australia will cut interest rates by 25 basis points at its meeting next week, with just a 2% chance of a deeper 50 basis point reduction. This aligns with a Reuters poll showing all 40 surveyed economists expecting the cash rate to be lowered to 3.60%. The RBA surprised markets at its last meeting by holding rates steady despite broad expectations for a cut, with the decision passing narrowly by a 6-3 vote.
CPI Expectations
For the US, today’s CPI release is expected to show a +0.2% monthly rise in headline inflation (down from +0.3% previously) and an increase in the annual rate from 2.7% to 2.8%. Core CPI is forecast to climb +0.3% M/M (vs. +0.2% previously) and edge higher from 2.9% to 3.0% Y/Y. MUFG warns that a hotter-than-expected CPI could derail expectations for a Federal Reserve rate cut in September.
Last week, markets were quite volatile once, with gold retreating and then bouncing to finish the week close to $4,000 but yesterday it retreatd again. EUR/USD continued the upward move toward 1.17, while main indices closed higher. The moves weren’t too big though, and we opened 35 trading signals in total, finishing the week with 23 winning signals and 12 losing ones.
Gold Rejected at $3,400 Again
Gold prices remain firm just below all-time highs after touching $3,500 an ounce in late April. Following last week’s FOMC meeting, which left interest rates unchanged, XAU/USD briefly dipped to $3,268 but quickly recovered on support from its 20-week simple moving average and softer US labor data. Bulls are now eyeing a break above the $3,450–$3,500 zone.
USD/JPY Volatility Highlights Fed–BoJ Divergence
The dollar briefly surged above ¥150 earlier this week, driven by global rate differentials and Japanese capital flows, before retreating by roughly 4 yen after weaker-than-expected US jobs data prompted profit-taking and reassessment of Fed policy bets.
USD/JPY – Weekly Chart
Cryptocurrency Update
Bitcoin Retests the highs above $122K and Fails
Cryptocurrencies continue to display resilience, with bitcoin bouncing sharply from below $112,000 to approach record levels above $122,000. Support from the 50-day SMA has helped solidify the $112K region as a key technical floor, fueling renewed bullish momentum. Yesterday BTC climbed above $122K but failed to make a new record high, coming back down below $120 where it closed the day.
BTC/USD – Weekly chart
Ethereum’s Rally to Multi-Year Highs
Ethereum (ETH) has staged a sharp comeback after lagging behind Bitcoin and XRP earlier in the year. Over the weekend, ETH crossed $4,300 — its highest level since 2021 — surpassing the highs of 2024. Strong institutional interest and bullish technicals suggest a realistic shot at challenging its all-time high of $4,860. While some bearish sentiment lingers, retail enthusiasm is now a key driver of the rally.
ETH/USD – Daily Chart
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Skerdian Meta
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Skerdian Meta Lead Analyst.
Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
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