Gold Market Wire
News, analysis and commentary for gold traders and investors
FX and Gold Update
FX Markets Shut Down Gold Volatility
July 30, 2025 - (Gold Market Wire) - Amidst the insistent cries that the US Dollar is 'finished', the Gold market is having its volatility frozen by the resumption of US Dollar strength. That strength amounts to, roughly, 2% (vs. most major currencies) over the past week. A combination of factors are at work.
The first is the increasing spectre of the Ukraine war being lost, and the belief that NATO will have to act, in the European theatre. That has placed a roof over the Euro's intermediate rally. If war in Europe expands to the Balkans, Kaliningrad, or sees the entry of NATO troops into Ukraine, the possibility of a further Euro rise against the US Dollar will be properly crushed. (What cannot go up, will, usually, go down.)
The second factor weighing in on the "non-Dollar" world is that the long-term Japanese government Bond, i.e. the 30-year JGP has soared past 3% in yield. That makes for a 50% increase in one year - from 2% to 3%. (Three years ago, it was 1%.) There is little to no chance of this trend reversing. It is starting to look like Japan's monumental debt levels are catching up with it. At 250% debt-to-GDP, it is one serious mountain of debt. Many economists put that number higher.
The Yen is in trouble, and the multi-decade 'widow-maker' trade looks like it is finally ending - in what is likely to be a wholesale sell-off of the Yen vs. the Dollar. As it stands now, a move to 200 to the USD/YEN could be coming sooner than many think. Such is the state of the global monetary system.
All of this is impacting Gold's rally, which has shut-down, to observe just how far the US Dollar may rise, and if the rally has legs. We think it does.

Contrary to the Goldbugs insistence that the US Dollar is finished, we may yet see that it has one more, significant, rally before the whole system is over-hauled. As for us, lo these many years, it remains: long US Dollar and long Gold. Seemingly contradictory, but in fact not at all. Why? The reason is simple. If the monetary system is cracking up (and it is) - the last two players left standing were always going to be the US Dollar and Gold.
It is now time to start shorting the Euro and the Yen against the Dollar. The hour is upon us.