Markets Open 2026 on Cautious Optimism (01.02.2026)

Global markets entered 2026 with a cautiously optimistic tone, as major currencies stabilized while precious metals extended their exceptional rallies. 

EUR/USD recovered toward 1.1760 as the ECB signaled a prolonged pause in rate cuts and markets increasingly priced a more dovish Fed outlook ahead of a potential leadership change. The yen remained weak near multi-month lows, keeping intervention risks in focus, while gold and silver began 2026 with strong momentum after record performances last year. Sterling held firm after posting its best annual gain since 2017, supported by expectations of a slower BoE easing cycle.

Euro Climbs as Markets Eye Fed Transition

The EUR/USD rose to 1.1760 on Friday, recovering from its recent dip. While the ECB held rates steady in December citing high global uncertainty, President Lagarde signaled a pause in cuts for the foreseeable future. Meanwhile, investor focus is shifting toward the U.S., where the potential for a new, more dovish Fed chair to replace Jerome Powell this May is rising expectations for lower interest rates and a softer dollar.

Technically, 1.1700 is the key support, while resistance is seen at 1.1800.

Yen Holds Near 10-Month Lows

The Japanese yen stabilized around 156.6 on Friday after two days of losses. Despite recent verbal warnings from Tokyo that successfully slowed its decline, the currency remains near a ten-month low. This persistent weakness keeps markets on high alert for a possible direct intervention to stabilize the exchange rate.

Technically, resistance stands near 157.30, while support is firm at 156.20.

Gold Starts 2026 With Record Momentum

Gold traded near $4,360 per ounce on the first day of 2026, building on its best annual performance in over four decades. After a staggering 65% surge in 2025, the metal continues to be supported by global US tariffs, expectations of lower interest rates, and steady central bank buying. Persistent geopolitical risks and growing ETF inflows also remain key drivers.

Gold sees support near $4300, while resistance is around $4395.

Sterling Posts Strongest Gains Since 2017

The British pound traded near $1.3480 after achieving a 7.5% gain against the dollar in 2025, its best annual performance in eight years. This strength was fueled by expectations that the Bank of England will cut rates more slowly than the Federal Reserve in 2026. Despite four rate reductions last year, a stable Autumn Budget and divided policymakers suggest a cautious approach ahead, providing a steady floor for the currency as it enters the new year.

From a technical view, support stands near 1.3400, with resistance around 1.3510.

Silver Starts 2026 Near $73

Silver climbed to $73 per ounce to start 2026, building on a historic 148% surge last year. The metal’s record performance was driven by its new status as a U.S. critical mineral, alongside chronic supply deficits and dwindling global inventories. Rising industrial demand for green technology, coupled with sweeping tariffs and expectations of looser U.S. monetary policy, continues to provide a powerful tailwind for the metal

From a technical view, resistance stands near $74.90 while support is located around $72.20.