🧠 Gold surges, dollar softens as markets look past Venezuela

Published: 1/6/2026

Good morning traders from a snowy IntelliTrade HQ, hope you have your coffee ready to sip because today’s article is an interesting one.

Overall Market Sentiment:

Global markets are in a broadly risk-on mood this morning, with equities at or near record highs even as investors digest the shock of a U.S. raid in Venezuela and the capture of President Maduro. The dollar is easing from Monday’s spike, gold is pushing into fresh record territory above 4,450 dollars an ounce, and this week’s data, especially Friday’s U.S. jobs report, will be the main test of whether the “soft landing plus lower rates” story can survive.

Geopolitics

It has been a dramatic start to the year: a U.S. special forces operation in Venezuela ended with the capture of Nicolas Maduro and an announcement from Washington of “temporary American control” over the country, along with threats of broader military action in Latin America. Oil initially jumped but has already slipped back, with Brent now trading near 61 dollars a barrel and WTI around 58, which tells you markets currently see limited immediate disruption to supply.

Instead, the geopolitical shock is showing up more clearly in safe havens and inflation hedges: gold is trading near 4,470 dollars an ounce, close to all time highs, as investors factor in a mix of geopolitical risk, concerns about U.S. fiscal dominance, and expectations of further Fed easing later this year. Markets are watching three key reference points for the week: Brent around 60–62 dollars, spot gold around 4,450–4,500, and the dollar index around 98 after Monday’s brief spike to almost 98.9.

🔻 USD

The dollar is on the back foot today after touching a near one month high yesterday, with the dollar index drifting back toward 98.2 as weaker U.S. manufacturing data and a firm equity tone encourage some unwinding of safe haven demand. The big backdrop is a Fed that has already cut rates three times, bringing the funds rate down to 3.5–3.75 percent, while 2 year yields have eased to around 3.45 percent and 10 year yields sit near 4.17 percent, leaving the yield curve modestly positive again but at fairly restrictive nominal levels.

Futures pricing implies markets still lean toward roughly two cuts in 2026, but the latest Fed minutes show a committee split between those worried about a 4.6 percent unemployment rate and those still focused on inflation that is only slowly settling toward 2 percent.

Friday’s U.S. jobs report is therefore the main event for the week: a soft payrolls print would reinforce the recent dollar pullback, while a strong report could quickly lift yields and push the dollar index back toward Monday’s high around 98.9.

For today and the next few sessions, risks still lean toward modest additional dollar softness against higher yielding or risk sensitive peers if the data do not surprise to the upside and the equity rally continues, but the Venezuela situation keeps a floor under the dollar against the very low yielding currencies like JPY and CHF.

🔺 EUR

The euro is quietly grinding higher, with EURUSD trading around 1.17–1.174 after rebounding from yesterday’s low near 1.166. Relative to the dollar, the euro benefits from a perception that the European Central Bank is closer to “normal” than the Fed: the deposit rate is around 2 percent, inflation is hovering close to target, and the market sees a very shallow easing path compared with the United States.

The immediate focus for the week is euro area inflation: German data later today and the euro area flash HICP tomorrow are expected to show headline price growth around 2 percent, which would keep the ECB comfortable and tend to support the currency if confirmed. Sovereign spread markets remain calm, and with gold and other commodities rising, the euro’s status as a “middle of the road” currency, neither classic safe haven nor classic high beta, looks attractive at current levels.

Key reference levels traders are watching include support around 1.167 and resistance near the recent high at 1.177–1.18; a benign inflation print plus a soft U.S. payrolls number would keep the balance of risks tilted toward a grind higher in EURUSD rather than a break lower.

⚖️ GBP

Sterling is participating in the dollar selloff, with GBPUSD trading in the 1.35 area after briefly pushing as high as 1.355–1.356 earlier in the European session. The Bank of England cut rates to around 3.75 percent in December but is still signaling caution, with markets debating how quickly further easing can occur given that headline inflation is near 3 percent and services inflation remains sticky.

This week’s U.K. data calendar is relatively light, so sterling is likely to take its cues from global risk sentiment and the dollar leg rather than domestic releases. The key spot reference for many participants is the former resistance zone around 1.35, which now acts as short term support; a sustained break back below 1.34 would suggest the latest GBP rebound is stalling, while stability above 1.35 keeps the picture mixed but constructive.

Given the combination of a still cautious BoE and a softening dollar, the near term risk tilt for GBP is neutral to mildly supportive, but the absence of major U.K. data this week means any surprise in U.S. payrolls can easily dominate the pair.

⚖️ CAD

The Canadian dollar is caught between softer oil prices and a softer U.S. dollar, leaving USDCAD consolidating around 1.37 after touching 1.38 yesterday. The Bank of Canada’s policy rate sits around 2.25 percent, with officials signaling patience as growth slows and the housing market remains fragile, and markets are pricing only limited cuts this year compared with the Fed.

On the commodity side, crude has given back much of its initial Venezuela shock spike, with Brent around 61 and WTI around 58 as investors focus on a looming supply surplus and rising Venezuelan exports once the new U.S. backed administration settles in.

That combination keeps the near term risk tilt for CAD broadly balanced: weaker oil caps upside, but a softening dollar and relatively cautious Fed keep scope for USDCAD to drift back toward the 1.36 area if risk appetite stays strong. The 1.38 zone above remains a key resistance band on many screens.

🔺 CHF

The franc remains firm, with USDCHF trading just below 0.80 and EURCHF around 0.93, reflecting Switzerland’s role as a classic safe haven in an environment where gold is at record highs and geopolitical headlines are noisy. The Swiss National Bank has its policy rate at 0 percent, inflation is essentially at the bottom of its 0–2 percent target band, and guidance suggests rates are likely to stay at zero through 2026, which keeps nominal differentials modest but still positive against the euro and deeply negative versus the dollar.

In practice, the franc’s strength is more about capital preservation than carry. With U.S. politics noisy, Venezuela in flux, and Europe still exposed to energy and tariff risks, CHF can attract flows even with zero rates. Markets also assume the SNB is more tolerant of a strong franc as long as inflation is low, although persistent appreciation below 0.78 in USDCHF or toward 0.92 in EURCHF would likely revive talk of FX intervention.

For the coming week, the risk tilt remains toward continued CHF firmness against higher yielders if geopolitical stress picks up again, but the immediate impulse is more a slow grind than a sharp spike given relatively calm credit and equity markets.

🔺 JPY

The yen remains structurally undervalued but is starting to receive more attention after the Bank of Japan’s December hike to 0.75 percent and repeated signals that more tightening is possible if inflation stays above target. USDJPY is still high by historical standards around 156, but has slipped from yesterday’s peak near 157.3 as U.S. 2 year yields edge lower and the market reconsiders how long Japan can tolerate such a weak exchange rate.

This week, attention is on upcoming Japanese wage data and on any further comments from officials about exchange rate sensitivity. The next BoJ policy meeting on January 22–23 looms large in the background and keeps volatility pricing in USDJPY elevated.

With U.S. 10 year yields around 4.17 percent and Japanese 10 year yields above 2 percent, the rate gap is still wide but no longer extreme, so the balance of risks over the next week leans toward a gradually firmer yen if U.S. data disappoint or if officials step up verbal intervention.

🔺 AUD

The Australian dollar is one of the clearer beneficiaries of the current mix. AUDUSD is trading around 0.67, close to its highest level since late 2024, helped by a softer dollar, firm equity markets and a more hawkish RBA stance as domestic inflation runs near 3.8 percent. The central bank has kept the cash rate at 3.6 percent but has explicitly left the door open to further tightening if services inflation does not ease, which contrasts with a Fed that is already well into an easing cycle.

China sensitive assets are also getting a tailwind from better data out of the mainland and the global tech rally, and this week’s focus for AUD watchers will be any surprise from U.S. payrolls and how that feeds into the global risk tone. As long as AUDUSD holds above about 0.665, the near term risk tilt remains toward further strength rather than a deep correction.

🔺 NZD

The kiwi has been quietly recovering after last year’s underperformance, with NZDUSD around 0.58 today, up from lows near 0.55 in late 2025 as the dollar softened and risk assets rallied. The Reserve Bank of New Zealand cut the OCR to about 2.25 percent late last year, but inflation is still near the top of its 1–3 percent band, so markets see room for only gradual further easing, especially if global growth remains decent.

From a relative rates point of view, NZD now sits in a middle tier. Yields are below those in the U.S. and Australia but well above those in the euro area and Switzerland, which means kiwi tends to do well when risk sentiment is positive but can lag AUD in periods when China specific optimism dominates. This week, with no major domestic data, NZD is likely to track AUD and the broader dollar leg, and as long as it holds above roughly 0.575, the risk bias stays tilted toward continued recovery rather than a retest of last year’s lows.

Cross-asset wrap

🪙 Gold: Gold is trading near 4,470 dollars an ounce after surging over the last month, supported by expectations of further Fed easing, concerns about U.S. fiscal sustainability as debt tops 38 trillion dollars, and the Venezuela shock that reminded markets how quickly geopolitical risk can strike. Real yields are still positive but off their peaks, and with the Fed funds rate already at 3.5–3.75 percent and likely to drift lower over 2026, the macro backdrop stays supportive for gold as a hedge against both policy error and geopolitical accidents.

🛢 Oil: Oil has been surprisingly subdued given events in Caracas. Brent is around 61–62 dollars and WTI near 58, as markets judge that any short term supply disruption from Venezuela will be offset by rising output elsewhere and the prospect of U.S. companies helping to ramp production once the political situation stabilizes. The key risk for the week is whether further escalation or sanctions chatter pushes prices back toward the low 60s for WTI and mid 60s for Brent, or whether the focus stays on ample supply and keeps crude in a broad sideways range.

📈 Stocks: Equities are broadly strong. The Dow and S&P 500 closed at or near record highs yesterday, energy shares outperformed on the initial oil spike, and Asian indices hit fresh records today as the AI and semiconductor theme rolled on. The equity market is effectively leaning into a “Goldilocks plus geopolitics” narrative in which earnings hold up, rates drift lower over time, and shocks like Venezuela prove manageable, but any upside surprise in Friday’s U.S. jobs data or sharp move in oil could quickly test that optimism.

₿ Crypto: Bitcoin has punched back above 93,000 dollars, helped by a fresh wave of ETF inflows and speculation that Venezuelan state holdings could be locked up or restructured, which some see as reducing near term selling pressure. Ethereum is trading above 3,200 as part of the same broader risk revival, and the key reference level many participants are watching is acceptance above about 95,000 on BTC, which would signal that the market has fully absorbed the late 2025 correction.

This is general, educational macro and FX commentary. It is not investment advice and not a trading signal.

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