Safe Havens Surge as Pound Slips: A Volatile Tuesday Open

The new trading day kicks off with a mix of risk-off sentiment and sector-specific momentum. Let’s break it down.

Indices remain in positive territory, generally trading on the green side of the market. However, a notable dip occurred at the tail end of the Asian session.. But as European markets opened, we’ve seen a solid recovery attempt, particularly in major benchmarks like the DAX and CAC 40.

One of the standout moves this morning is happening on the Japanese Yen. The Yen is showing strong gains, a clear indication that some traders are leaning toward safe-haven assets. This sentiment is echoed in the gold market, where we’ve seen a notable upswing over the past two hours. Gold is climbing sharply, possibly fueled by both technical buying and macro uncertainty.

In currencies, all eyes are on the British Pound, which is under pressure. Today’s UK labor market data brought mixed signals: the Average Earnings Index came in below expectations, while the Claimant Count Change was higher than expected. This combination points to slack in the UK labor market, which puts downward pressure on the Pound. Unsurprisingly, GBP/JPY is one of the weakest performing pairs this morning, combining a soft Pound with a strong Yen.

Looking at commodities, oil continues to shine. After a strong rally on Monday, oil prices are pushing even higher today. This marks a rare consistent bullish trend in the commodity space this week. On the flip side, not all metals are enjoying the same momentum as gold. Copper, for example, is trading 1% lower, breaking away from the broader move in precious metals.

As for the macro calendar, today is relatively quiet apart from the earlier UK data. No tier-one economic releases are scheduled for the remainder of the day, so traders may look to technicals and broader sentiment for cues—especially ahead of tomorrow’s inflation figures from the U.S.

In summary: it’s a day of divergence and defensive plays—with gold and Yen gaining, oil continuing to rally, and the British Pound retreating after soft labor data.

Source: https://www.axiory.com/analytics/market-news/safe-havens-surge-as-pound-slips-a-volatile-tuesda