Markets are wild right now – geopolitics is back in the driver’s seat, like never before and traders have been glued to their screens since the very first trading day of the year. With the VIX closing at yearly highs today, volatility doesn’t seem to be dying down anytime soon.
Spotlight: EUR/USD – The Breakout We’ve Been Watching
EUR/USD just punched through that stubborn resistance zone around 1.1650 and is hovering near 1.1720 as I write this. We’re talking fresh highs not seen since early January, and a move above 1.18 will put the pair at highs from 2021, with the pair ripping higher on a cocktail of:
- Trump’s latest Greenland flex (yes, really tariff threats on Europe to twist Denmark’s arm). Markets read it as another “Sell America” signal, weighing on the dollar.
- Solid German ZEW sentiment jumping to 59.6 (way above expectations), hinting the Eurozone might dodge the worst of the slowdown fears.
- Dollar fatigue after 2025’s drama, with Fed cuts priced in, but no panic easing yet.
Chart: The pair burst out of that descending channel from late 2025. Support now at 1.1680–1.1700 (former resistance), with eyes on 1.1800 if momentum holds. Bears need a clean drop below 1.1650 to call it a fakeout. Volatility’s up, so watch for whipsaws around Davos chatter and any EU retaliation noise.
If you’re positioned, this might feel like the euro’s got legs short-term – unless Trump doubles down and Europe folds quietly (unlikely).
Quick Gold Hit: Safe-Haven Mode Activated
Gold? It’s not even pretending to have any sellers anymore. Spot just tagged fresh all-time highs above $4,850–$4,870 (some prints over $4,880), up sharply today on the same geopolitical heat and $5K firmly on the cards.
Why the surge:
- Classic flight to safety as US-Europe tariff drama escalates.
- Dollar weakness feeding the move.
- Central banks + investors still piling in – LBMA survey has pros calling for $5,000+ average in 2026 (some see $6k longer-term).
Gold’s up ~10% this month alone and ~76% year-over-year. Momentum’s brutal – $5,000 is no longer a stretch question; it’s the conversation.
Bottom line: EUR/USD’s breakout has legs while the dollar’s on the back foot, and gold’s reminding everyone why it’s the original chaos hedge. Keep risk tight – news flow is spicy.
Trade smart,
Anish
BlackBull Research Team
@anish8fx