Trifecta Market Watch

Gold surged to an intraday high of $5,230/oz on Monday — its highest level since late January — before pulling back slightly to settle near $5,201 as the US dollar firmed. The +2.4% single-session gain was driven by a perfect storm of safe-haven demand: Trump's invocation of Section 122 tariffs, escalating US-Iran tensions ahead of Thursday's Geneva nuclear talks, and continued structural central bank buying.

The gold/silver ratio has compressed to approximately 60x (down from 100x in early 2025), reflecting broad precious metals strength. Reuters noted gold "falls from three-week high as dollar firms" in early Tuesday trade — a healthy consolidation after Monday's spike rather than a trend reversal. JPMorgan maintains a year-end 2026 target of ~$6,300/oz; UBS at ~$6,200/oz.

Silver is consolidating near $86.53/oz after testing the $88 resistance zone last week. The slight -0.4% pullback in early Tuesday trade is a pause rather than a reversal — the broader uptrend from the $76–$77 lows in late January remains firmly intact. MarketPulse notes silver is approaching the $90–$95 resistance zone, a technically significant area that has capped rallies since 2011.

The gold/silver ratio at ~60x (down from 100x) signals meaningful silver outperformance over the medium term. The RSI is approaching overbought territory on the daily chart, suggesting a brief consolidation before the next leg higher. The structural bull case remains intact: the Silver Institute projects a fourth consecutive annual market deficit in 2026, driven by record solar panel manufacturing demand (600 GW forecast globally).

Oil markets are hovering just below a seven-month high as two competing forces play out. WTI crude hit $67.28/bbl on Monday — its highest level since August 4 — before easing back to $66.62 as traders balanced geopolitical risk premium against demand uncertainty. Brent is trading near $71.40, consolidating after its recent recovery from the $56 lows in early 2026.

The primary upside catalyst is US-Iran tension. Trump has given Iran a 10–15 day deadline and is reportedly considering limited military action, raising the spectre of Strait of Hormuz disruption. However, US-Iran nuclear talks are scheduled for Thursday in Geneva, with Iran's Foreign Minister signalling "a good chance" of a diplomatic solution — any positive outcome would reduce the geopolitical premium.

Bitcoin fell sharply on Monday, briefly touching $64,270 — a two-week low — before partially recovering to $66,300 during Asian hours. The -4.0% single-session decline was driven by broad risk-off sentiment as the S&P 500 fell -1.04% and the VIX spiked to 21. Santiment noted BTC dropped 4.5% in just two hours, with open interest falling sharply as leveraged longs were flushed out.

A critical technical development: the $65,650 weekly support level has failed, according to Bitcoin Magazine's technical analysis. Analysts are now watching the $60,000 psychological support and the $57,800 weekly close level — a breach of the latter would signal a deeper correction toward $53,000. BTC's correlation with the S&P 500 remains elevated at 0.68, meaning further equity weakness would pressure crypto.

EUR/USD is trading near 1.1786 in early Tuesday trade, pulling back -0.56% as the US dollar firms modestly despite ongoing tariff uncertainty. The pair has been oscillating in a narrowing triangle pattern (FreshForex Elliott Wave analysis), with decreasing volatility suggesting a directional break is approaching. The 9-day EMA near 1.1800 is providing near-term resistance.

On the Eurozone side, the German IFO Business Climate for February beat expectations at 88.6 (consensus 88.3, prior 87.6) — a 6-month high that signals improving business sentiment despite the tariff overhang. The ECB is pricing only a 2% probability of a rate cut at the March 19 meeting, as Eurozone negotiated wage growth remains elevated at 2.95% YoY (Q4 2025).

The South African rand is holding near R16.00/$ ahead of Wednesday's National Budget Speech — the most consequential domestic event of the week. CNBC Africa reports the rand is "edging up with the National Budget in focus," supported by a positive fiscal backdrop: Finance Minister Godongwana is expected to announce South Africa's first primary budget surplus in over a decade, with the gold price windfall providing additional fiscal headroom.

Daily Maverick notes Godongwana "has some fiscal wind in his sails" — gold revenues are running significantly above budget assumptions, and the debt-to-GDP trajectory is improving. BofA and StanChart see a credible path to a sovereign rating upgrade from Moody's and S&P if the budget delivers on fiscal consolidation. The JSE All Share Index is benefiting from both the gold rally (Precious Metals & Mining +2.3% last week) and improving domestic fundamentals.

US equity markets suffered a sharp Monday selloff driven by dual headwinds: tariff policy uncertainty and AI disruption fears. The S&P 500 fell -1.04% to 6,838, the Dow Jones dropped -1.66% to 48,804 (a 3-week low), and the Nasdaq 100 declined -1.21% to 24,709. The VIX spiked to 21, its highest level since early February. The 10-year Treasury yield fell to a 2.75-month low of 4.016%, reflecting flight-to-safety bond buying.

The AI disruption catalyst was a Citrini Research report highlighting Anthropic's Claude as a threat to multiple sectors: IBM fell -13% (Claude can modernise COBOL, IBM's core business), DDOG -11%, CRWD -10%, TEAM -10%, COF -8%, AXP -7%. This is the second major AI disruption scare of 2026 after DeepSeek in January. The S&P 500 has been in an unusually tight range for four months, failing to sustain upside breakouts.

The Hang Seng Index (HK50) fell -1.68% to 26,613 on Tuesday as AI disruption fears hit Hong Kong-listed technology stocks. Pop Mart (the Labubu maker) was the largest loser at -5.39%, while broader HK tech names sold off in sympathy with US software stocks. The index had reached a high of 27,082 on Monday before the risk-off wave from Wall Street carried over into Asian trade.

The PBOC kept the Loan Prime Rate (LPR) unchanged at its February fixing: 1-year LPR at 3.00%, 5-year LPR at 3.50%. This was in line with expectations and signals the central bank is comfortable with current monetary conditions. China's mainland markets (Shanghai, Shenzhen) fully reopened Tuesday following the Lunar New Year break, with the CSI 300 opening +1.04% — a constructive catch-up move after two weeks of closure.

The DAX fell -0.99% to 24,992 on Monday, pulled lower by the global risk-off wave despite a positive domestic data surprise. The German IFO Business Climate for February came in at 88.6 — a 6-month high, beating the 88.3 consensus — signalling that German business sentiment is recovering even as the broader economy remains fragile. The Euro Stoxx 50 fell from a record high, declining -0.28% on the session.

The DAX remains one of the strongest major index performers YTD at approximately +12%, driven by expectations of increased German public spending on infrastructure and defence following the February 23 federal election. The 10-year German Bund yield fell to a 2.75-month low of 2.710%, mirroring the US Treasury flight-to-safety move.

The Nikkei 225 (JP225) rose +0.76% to 57,257 on Tuesday, reopening after Monday's Emperor's Birthday holiday with a positive catch-up move. The index is trading at significantly elevated levels compared to the prior week's report (~38,776), reflecting both the holiday closure gap and the broader structural re-rating of Japanese equities in 2026. USD/JPY is near 154.96, with the weaker yen providing support for Japan's export-heavy index constituents.

The Bank of Japan raised rates to 0.50% in January 2026 — the highest level since 2008 — and Governor Ueda has signalled further gradual hikes are possible if inflation remains above target. The yen has weakened to ~155 against the dollar (from ~149 in the prior report), which is a net positive for Nikkei exporters (Toyota, Sony, Keyence) but creates a headwind for domestic consumption stocks.