Dollar Index Holds Below 98 as Markets Await Trade Deal ProgressThe dollar index remained below 98 today, extending its two-day decline as investors watched trade negotiations ahead of the August 1 deadline. Treasury Secretary Scott Bessent said deal quality is the priority, suggesting Trump could grant extensions to countries showing real progress.
Markets are also focused on Fed Chair Powell’s speech for signals on interest rates. Despite Trump’s push for a cut, traders are not expecting action this month.
Fed
Gold Bulls Reloading? Smart Money Buys!The technical outlook on XAU/USD shows a well-defined bullish trend, developing within an ascending channel that started in late June. Price recently pushed toward the upper boundary of this channel, reaching a key resistance zone between 3,410 and 3,420 USD, which aligns with a previous supply area and significant daily structure. The reaction in this zone suggests a potential fake breakout, hinting at a short-term pullback before a continuation of the upward move.
The RSI oscillator supports this view, displaying bullish momentum with a breakout above the 60 level. However, the current slope hints at a possible minor correction before the next impulsive leg higher. The most relevant demand zone lies between 3,340 and 3,360 USD, at the base of the ascending channel—an ideal spot for buy orders to accumulate in anticipation of a move toward previous highs.
Backing this technical setup, the Commitment of Traders (COT) report as of July 15, 2025, paints a constructive picture. Non-commercial traders (institutional speculators) increased their long positions by over 8,500 contracts, while also cutting short positions by about 1,600 contracts, indicating a strong bullish bias. Commercials also increased their shorts (+16,448), a typical hedge during rallies, but not enough to invalidate the bullish structure.
From a seasonal perspective, July remains one of the historically strongest months for gold. According to MarketBulls data, over the past 2 years, gold has averaged gains of 105+ points in July, with solid returns also visible on the 5-year (+45 pts) and 10-year (+25 pts) averages. August also tends to be supportive, reinforcing the idea of a medium-term bullish extension.
Lastly, the retail sentiment is heavily skewed, with 72% of retail traders short, and only 28% long. From a contrarian standpoint, this is another strong bullish signal. When the majority of retail traders are short in a structurally bullish market, the potential for a short squeeze remains high.
10Y: Positioning for a Falling Yield EnvironmentCBOT: Micro 10 Year Yield Futures ( CBOT_MINI:10Y1! ), #microfutures
The Federal Reserve last cut interest rates in December 2024. Since then, it has kept the rates unchanged in its January, March, April and June FOMC meetings. While the official Fed Funds rate stays at 4.25-4.50% in the past seven months, we have seen diverging trends in the interest rate market:
• 2-Year Yield has trended down from 4.25% to around 3.85%;
• 10-Year Yield mostly moved sideways, currently at 4.42%;
• 30-Year Yield rose from 4.60% to top 5.00% in May, then pulled back to 4.89%.
The futures market expects the Fed to cut rates once or twice in the remaining four FOMC meetings in 2025, according to CME Fed Watch Tool.
• As of July 20th, there is a 95.3% chance that the Fed will keep rates unchanged in its July 30th meeting;
• The odd of lowering 25 bps is approximately 60% for September 17th;
• By the last 2025 meeting on December 10th, futures market sees just 6.4% chance that the Fed keeps the rates at current level 4.25-4.50%, while the odds of 1 cut to 4.00-4.25% are 29.2%, and the odds of 2 cuts to 3.75-4.00% are 64.3%.
The Fed’s Challenges
The Fed tries to fulfil its dual mandate established by the Congress: (1) to support maximum employment and (2) to maintain price stability. Its official targets are to keep the unemployment rate below 4%, as measured by the BLS nonfarm payroll data, and to keep the inflation rate at 2%, as measured by the PCE price index. When we face an outlook of rising prices and slowing employment, the Fed will have a hard time meeting both policy goals.
Firstly, as the Trump Administration raises tariffs for all trading partners on all imports, it’s a matter of time before the inflation rate picks up again. Even if many countries may reach trade agreements with the U.S., they will still get a bigger tax bill.
• According to the Bureau of Economic Analysis (BEA), the total US imports of goods and services was $4.1 trillion for 2024.
• Imports account for 14% of the US GDP in 2024, which is $29.2 trillion (BEA data).
• Simple math suggests that a universal 10% tariff hike could contribute to 1.4% in price increases, assuming all tariffs are passed through to the retail prices.
The most recent inflation data is the June CPI at 2.7% (BLS data). The tariff hike could easily push inflation to twice the Fed policy target. Therefore, cutting rates will be a very difficult decision if inflation rebounds.
Secondly, US employment growth has slowed down significantly in 2025. On July 3rd, the BLS reported total nonfarm payroll increased by 147,000 in June, and the unemployment rate changed little at 4.1 percent. Current employment growth is less than half the level in December 2024, which saw the data above 300,000.
There are weaknesses in the payroll data. All private sectors combined accounted for about half of the employment gain, or 74,000. Government jobs, while at a much smaller base, accounted for the other half.
Tariffs raise the cost of input, while business borrowing costs remain high at current rate level. To support growth and maximum employment, cutting rates make sense.
Finally, the Fed is under tremendous pressure from the Administration. President Trump openly and repeatedly calls for a 300bp cut.
In an ideal world, the Fed wants to make monetary policy decisions free of political interference. It may not be the case. Let’s look at the Fed rate decisions during the first Trump presidential term. The current Fed Chair was appointed to the role by President Trump in February 2018.
• The Fed raised interest rates four times in 2018, for a total of 100 basis points, with the Fed Funds rate increased from 1.25-1.50% to 2.25-2.50%.
• Under pressure from the White House, the Fed cut rates three times in 2019 for a total of 75 basis points, with the Fed Funds rate ending at 1.50-1.75%.
• In 2020, in response to the Pandemic, the Fed cut rates by 150 points, all the way to a zero-rate environment (0%-0.25%).
In my opinion, the Fed will cut rates this year, similar to 2019. Once the Fed Chair retires in May 2026, his replacement, who will be nominated by President Trump, will no doubt follow his guidelines and bring the Fed Funds rate all the way down to 1%-2% level.
While there is uncertainty in the timing and pace, we are likely to embark on the path to low interest-rate environment.
Shorting Micro 10-Year Yield Futures
A trader sharing a bearish view on interest rates could explore shorting the CBOT Micro 10-Year Yield Futures ($10Y).
Last Friday, the August 10Y contract (10YQ5) was settled at 4.425. Each contract has a notional value of 1,000 index points, or a market value of $4,425. To buy or sell 1 contract, a trader is required to post an initial margin of $300. The margining requirement reflects a built-in leverage of 14.7-to-1.
Let’s use a hypothetical trade to illustrate how to use a short futures position to take advantage of a potential Fed rate cut.
Hypothetical Trade:
• Short 1 10YQ5 at 4.425, and set a stop loss at 4.60
• Trader pays $300 for initial margin
Scenario 1: Fed keeps rates unchanged on July 30th, 10Y moves sideways
• If Futures price changes little after the July FOMC, the trader could close the position
• He could short the September contract 10YU5, with an eye open for the September 17th FOMC rate decision
• This is a futures rollover strategy.
Scenario 2: Fed cuts 25 bps on July 30th, 10YU5 falls 250 points to 4.175
• Short position gains: $250 (= (4.425-4.175) x 1000)
• The hypothetical return will be 83% (= 250 / 300)
Happy Trading.
Disclaimers
*Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services.
CME Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
Inflation vs. Growth : Is the Fed Behind or Ahead of the Curve?CME_MINI:NQ1! CME_MINI:ES1! CME_MINI:MNQ1! CME_MINI:MES1! CBOT:ZN1!
Fed Policy recap:
There is an interesting and unusual theme to keep an eye on this week. The Fed is in a ‘blackout period’ until the FOMC meeting- this is a customary quiet period ahead of an FOMC policy meeting. Fed Chair Powell is scheduled to give a public talk on Tuesday. Although his address will be focused on the capital framework of the large banks, this appearance will be closely watched for any subtle signals on the FOMC policy stance.
Especially given that last week, Federal Reserve Governor Chris Waller made a speech, “The Case for Cutting Now” with a purpose as he stated to explain why the FOMC should reduce rate by 25 bps at the July 30th, 2025 meeting.
His stated reasons were:
1. Tariffs create one-off price level increases with transitory inflation effects, not sustained inflation momentum.
2. He argued that much of economic data points towards interest rates should be lowered to FOMC’s participants' median neutral rate, i.e, 3%.
3. His third stated reason notes that while the state of the labor market looks resilient on the surface, accounting for expected data revisions, private-sector payroll growth has peaked, with more data suggesting increased downside risks.
His speech further explains:
• Growth has decelerated sharply: Real GDP rose only ~1% annualized in 1H25, a significant slowdown from 2.8% in 2H24, and well below long-run potential.
• Consumer spending is weakening, with real PCE growth falling to ~1%, and June retail sales showing soft underlying momentum.
• Broader labor market indicators, including the Beige Book and JOLTS data, show declining labor demand and hiring caution, suggesting increasing downside risks to employment.
• Inflation is slightly above target (PCE ~2.5%) but driven primarily by temporary, one-off tariff effects. Core inflation ex-tariffs is likely near 2%, and expectations remain anchored.
• Current fed funds range (4.25%–4.50%) is well above neutral (3%), implying excessive restraint.
• With inflation risks subdued and macro conditions deteriorating, a preemptive rate cut now provides optionality and avoids falling behind the curve if the slowdown deepens. Further cuts may be warranted if trends persist.
• The tax bill contains pro-growth provisions, but its economic impact is expected to be minimal in 2025.
Source: Federal Reserve Speech, The Case for Cutting Now Governor Waller
Inflation Analysis:
Let’s compare this with what we have previously mentioned regarding inflation. CPI index stood at 257.971 points in January 2020. Projecting this at a 2% Fed target, June 2025 inflation should be around 287.655 points. However, June 2025 inflation is currently at 322.56 index points, 12.2% higher above 2% the inflation trend. Effectively, this means annualized inflation since January 2020 is roughly 4.15%.
The Fed is in a real dilemma whether cutting rates given the inflation trend in the last 5 years and risks to inflation outlook justify cutting rates.
Key Questions to ask
Markets are forward looking. Investors and participants want to know:
• How will the rates impact the cost of debt service? Currently the third largest government expenditure, over $1.03 trillion.
• Will the tariff rate offset the tax revenue losses by extending tax cuts?
• Is the fiscal path sustainable?
• What happens to the long end of the yield-curve?
• Will the Fed monetize the debt issuance imbalance?
• Is this simply Governor Waller positioning himself for the next appointment of Fed Chair when Fed Chair Powell’s term expires in May 2026?
It seems there is a huge conflict between longer term implications vs quick short term fixes that align with US administration objectives.
The Week ahead:
It is a relatively light economic calendar in the US. Flash PMI readings and housing data on the docket. The primary focus as it has been for most weeks since President Trump took office, will be on the developments in trade policy and any further comments on Fed and Chair Powell. The threat of renewed tariffs starting August 1st, is also key to monitor and whether these protectionist measures will force US’s trading partners to make further concessions to negotiate trade deals.
The earnings season is off to a good start with major US banks reporting higher EPS and revenue than expectations. This week investors will be looking at Q2 earnings reports from Alphabet, Meta, Microsoft from the Mag 7 and Tesla.
Bullish Multi-Timeframe Alignment, Macro Risks & Key Levels__________________________________________________________________________________
Technical Overview – Summary Points
__________________________________________________________________________________
Momentum: Strong bullish trend across all timeframes.
Major Supports: 115796/117277 (720/240 Pivot Low).
Key Resistances: 119000–123200 (240/D Pivot High), watch for potential extension or profit-taking.
Volume: Healthy participation, no marked anomalies.
Risk On / Risk Off Indicator: Strong sector momentum except 15min (neutral), risk appetite confirmed.
Multi-TF Behavior Synthesis: No "behavioral sell" warning, ISPD DIV neutral, no climax.
__________________________________________________________________________________
Strategic Summary
__________________________________________________________________________________
Global Bias: Clearly bullish, all timeframes aligned, no notable technical divergences.
Opportunities: Buy on pullback (HTF support) or on breakout/consolidation above 123200 with increasing bullish volume.
Risk Zones: Drop below 115796 invalidates scenario; watch for “sell” behavioral signals (ISPD red/extreme volumes) or persistent sector divergence.
Macro Catalysts: Next Fed meeting (July 21st), ongoing geopolitical tensions.
Action Plan: Closely monitor supports/resistances, strict stops below 115796, dynamic adjustment to upcoming macro volatility.
__________________________________________________________________________________
Multi-Timeframe Analysis
__________________________________________________________________________________
1D: Bullish breakout, leading tech/growth sector, stable volume.
12H: Bullish signal, price held above all key HTF pivots.
6H: Consolidation below key resistance 123218, no distribution, strength intact.
4H: Sideways just below resistance, controlled pause, possible push upwards.
2H: Stalling under resistance yet bullish momentum still present.
1H: Supports defended, rising volume on rebounds, no excess.
30min: Intraday momentum positive; no signs of reversal, strong indicator consensus.
15min: Testing pivots, slight momentum decline, neutral on Risk On / Risk Off Indicator.
__________________________________________________________________________________
Technical confluence: All timeframes aligned upward, strong sector momentum, controlled volumes, no behavioral excess. Watch for resolution near the 119000–123200 resistance zone (potential supply), and monitor for alert signals on behavioral/volume side. Macro: anticipate volatility around July 21 (Fed).
__________________________________________________________________________________
Macro & Decision Synthesis
__________________________________________________________________________________
News / Macro: Upcoming Fed meeting = caution period, expected volatility spike. Geopolitics: Middle East/Europe tensions, no Asian shock.
On-chain: BTC in price discovery, initial STH profit-taking, everyone in latent profit (interim top risk if overheated, reward up to $130k possible).
Actionable checklist:
Optimal entry: Pullback on 115796–117277 or strong breakout above 123200 with confirmed volume
Stop-loss: Below 115796 (major pivot); intraday swings below 117277
Imperative risk management, avoid leveraged trades ahead of macro event
__________________________________________________________________________________
Final Conclusion
__________________________________________________________________________________
Bitcoin is structurally bullish, supported by perfect multi-timeframe alignment, strong sector leadership (Risk On / Risk Off Indicator), and positive on-chain signals. However, proximity to historical resistances and looming volatility call for strict, active risk management. Targets: $123k/$130k; stops below 115796.
NAS100 - Stock Market Awaits Tariffs!The index is trading above the EMA200 and EMA50 on the 1-hour timeframe and is trading in its ascending channel. The target for this move will be the channel ceiling, but if it corrects towards the indicated support area, it is possible to buy Nasdaq with better reward to risk.
In a week once again clouded by trade tariff threats, the stock market reacted cautiously at times. However, what truly captured investors’ attention was growing concern over potential political interference in Federal Reserve policymaking—a development that influenced market sentiment and shifted the focus away from geopolitical tensions.
Despite political headwinds, U.S. economic data continued to show signs of resilience. Investors this week were more focused on corporate earnings and inflation data than on trade war rhetoric or speculation about Jerome Powell’s possible dismissal. While betting markets such as Polymarket raised the odds of Powell being removed to 40%, legally, the president cannot dismiss the Fed Chair without a valid cause—and allegations like “lying to Congress” lack legal standing.
Still, the greater danger lies not in Powell’s dismissal itself but in the potential erosion of the Federal Reserve’s independence—something that could unsettle investors in stocks, bonds, and currencies alike. Analysts expect Trump may soon appoint an ally as an informal or “shadow” Fed Chair, a move that would elevate political risk in financial markets.
Nevertheless, markets are continuing to operate along familiar lines: equities focus on corporate profits, the bond market on inflation and growth, and the currency market on relative returns. For now, the takeaway is clear: Trump is winning—but perhaps only temporarily.
Rick Rieder, Chief Investment Officer at BlackRock, noted that despite trade tensions and inflation concerns, tariffs have had limited impact so far. Following the June CPI report, he pointed out that inflation ticked up slightly—core CPI rose by 0.23% monthly and 2.93% annually, while headline inflation was up 0.29% monthly and 2.67% annually—but the broader trend still reflects easing price pressures.
Rieder attributed this to companies acting preemptively, managing inventory and adjusting supply chains to avoid passing on costs to consumers. He also cited easing wage pressures and a weakening labor market as factors contributing to the decline in inflation.
As such, Rieder believes the Federal Reserve might lower interest rates in September, though a cut in July is less likely, as the central bank would prefer to assess the impact of tariffs first.
According to the Wall Street Journal, Treasury Secretary Scott Besant privately urged Trump not to remove Jerome Powell. Besant warned that such an action could cause unnecessary turbulence in financial markets and the broader economy, and would also face legal and political hurdles. He emphasized that the Fed is already signaling potential rate cuts later this year, and confronting Powell now would be unwarranted.
A source noted that Besant reminded Trump the economy is performing well, and markets have responded positively to administration policies—another reason to avoid drastic moves.
On another front, rising long-term bond yields have become a concern for Besant, as they increase the government’s borrowing costs.He has been working to keep yields in check and believes firing Powell could further escalate them—hence his conversation with Trump aimed at dissuasion.
The coming week will begin with market attention on the European Central Bank’s rate decision, which could set the tone for Eurozone monetary policy in the second half of the year. Meanwhile, a series of key U.S. economic data will be released, providing a clearer view of conditions in employment, production, and housing.
On Tuesday, Jerome Powell will deliver an opening speech at an official event in Washington. While he is unlikely to directly address Trump’s recent verbal attacks, investors will be listening closely for any subtle references to Fed independence or interest rate direction.
On Wednesday, the June existing home sales report will be released, which could indicate whether housing demand remains steady or is weakening.
Thursday will be a packed day on the economic calendar. The ECB’s rate decision will be announced—an event under heavy scrutiny amid Eurozone stagnation. In the U.S., preliminary PMI data from S&P, weekly jobless claims, and new home sales will also be published.
Finally, the week will wrap up on Friday with the release of U.S. durable goods orders—an important gauge of capital investment in the manufacturing sector.
Bitcoin - Will Bitcoin reach its previous ATH?!Bitcoin is above the EMA50 and EMA200 on the four-hour timeframe and is in its ascending channel. Bitcoin’s current upward momentum has the potential to reach its previous ATH. If it corrects, we can look for Bitcoin buying positions from the specified support area, which is also at the intersection of the bottom of the ascending channel.
If this support is lost, the decline will continue to around $113,000, where we can again buy Bitcoin with a better risk-reward ratio.
It should be noted that there is a possibility of heavy fluctuations and shadows due to the movement of whales in the market, and capital management in the cryptocurrency market will be more important. If the downward trend continues, we can buy within the demand area.
Last week, the U.S. House of Representatives passed the CLARITY Act (Crypto-Asset National Regulatory Transparency for Investors and Consumers Act) with 294 votes in favor and 134 against, including support from 78 Democrats. The bill represents the first comprehensive legislative effort to regulate the cryptocurrency industry and is considered a major regulatory win for digital asset proponents.
Key features of the legislation include:
• Clearly defining the regulatory roles of agencies like the SEC and CFTC
• Establishing a new category for registered digital assets
• Facilitating broader integration of cryptocurrencies into traditional financial systems
Status in the Senate: Despite bipartisan approval in the House, the bill’s future in the Senate remains uncertain. Senators are still in the early stages of drafting their own version, and significant revisions are expected. Some Senate Democrats insist that the bill must explicitly address President Trump’s and his family’s cryptocurrency holdings.
The CLARITY Act is part of a broader Republican-led legislative initiative dubbed “Crypto Week,” which includes two additional major digital asset bills aimed at modernizing blockchain regulation and the broader digital finance ecosystem.
Meanwhile, Donald Trump is preparing to issue an executive order that would open up U.S. retirement markets to cryptocurrencies, gold, and private equity. This order would allow 401(k) fund managers to incorporate alternative assets into retirement portfolios.
The move follows the rollback of Biden-era restrictions and the recent passage of three crypto-related bills in the House. While major investment firms have welcomed the proposal, critics warn that alternative assets may expose retail investors to greater financial risks.
Also last week, Bitcoin reached a new all-time high, pushing its market capitalization to $2.43 trillion. It has now surpassed Amazon, Google, and even silver, becoming the fifth-largest asset globally by market value.
Looking ahead, one of the key events on the economic calendar is Federal Reserve Chair Jerome Powell’s upcoming speech at an official central bank-hosted conference on Tuesday. This event comes just before the release of the preliminary S&P Global Purchasing Managers’ Indexes (PMIs) on Thursday. Given Trump’s escalating verbal attacks on Powell, a central question is whether this political pressure has influenced the Fed Chair’s stance.
Trump has repeatedly urged Powell to lower interest rates. This week, reports emerged suggesting that the President had discussed with some Republicans the possibility of removing Powell from his position. However, Trump was quick to downplay the reports, stating that the likelihood of Powell being dismissed was “very low.”
In this context, if Powell uses his speech to reassert the Fed’s independence and calls for patience to assess the impact of tariffs more thoroughly, the U.S. dollar may continue its recent upward trend. Still, it’s too early to confirm a definitive bullish reversal for the dollar. While the global reserve currency has responded positively to headlines fueling tariff concerns, markets could mirror April’s behavior—when fears of recession led investors to sell the dollar instead of buying it—should those concerns intensify again.
3-Year Euro Uptrend — An Absurdity Amid a Weak EconomyCMCMARKETS:EURUSD
The euro is climbing, hitting its highest levels since late 2021 near $1.18. This surge is driven by diverging central bank policies—with the ECB holding rates steady while the Fed leans dovish—amid global tensions that push gold higher and rattle markets, weakening the dollar even though the eurozone economy remains fragile.
📉 1️⃣ Dollar Weakness Takes Center Stage
Since its January 2025 peak, the U.S. Dollar Index (DXY) has fallen by over 11% 📉—one of its worst starts in decades, comparable to the slumps of 1986 and 1989. As inflation cools, markets are betting on Fed rate cuts, pulling U.S. Treasury yields lower. Coupled with monetary policy divergence and tariff drama, the dollar’s usual safe-haven appeal is fading, even amid ongoing geopolitical tensions.
📊 2️⃣ Fed–ECB Policy Divergence
While the ECB has signaled the possibility of one or two cuts this year, markets are pricing in a milder path. By contrast, the Fed is tilting dovish, with swaps markets expecting a rate cut in September and another by December 🗓️. This widening yield differential supports EUR/USD, even though eurozone growth remains soft.
⚖️ 3️⃣ Trump Tariff Risks and Sentiment Shift
Uncertainty around U.S. trade policy—especially the threat of renewed tariffs—has weighed more heavily on USD sentiment than on eurozone currencies. Markets view these tariffs as inflationary and damaging to U.S. growth prospects. Speculative positioning data confirms record bearish sentiment on the dollar, with funds underweight USD for the first time in 20 years 💼.
💶 4️⃣ Eurozone’s Fiscal Shift
Germany has begun spending and borrowing, marking a dramatic pivot from years of fiscal restraint. This has raised hopes for an investment-driven recovery across the eurozone. Meanwhile, ECB President Christine Lagarde is avoiding signaling aggressive cuts, stabilizing market expectations and maintaining a sense of monetary calm—for now 🛡️.
🛡️ 5️⃣ Safe-Haven Flows Shifting
Traditionally, geopolitical stress boosts the USD as a safe haven. This cycle is different: investors are increasingly turning to gold, the Swiss franc, and the yen as defensive assets, indirectly supporting the euro. In April, when Trump delayed tariff plans, safe-haven USD flows unwound further, fueling euro gains 💰.
⚠️ Risks Ahead for EUR/USD:
💔 Weak Eurozone Fundamentals:
The eurozone economy is not booming. The IMF projects just 0.9% growth for 2025, with Germany, France, and Italy struggling to regain momentum. The ECB’s Financial Stability Review flags worsening credit conditions, weak private investment, and deteriorating balance sheets, none of which support sustained euro appreciation 📉.
🚢 A Strong Euro Hurts Exports:
Eurozone exporters in machinery, chemicals, and autos are already facing squeezed margins from rising input costs and global protectionism. A stronger euro makes exports less competitive, shrinking the eurozone’s current account surplus, which dropped sharply from €50.9 billion in March to €19.8 billion in April, according to the ECB 📊.
⚡ Political Risks Looming:
Fragile coalitions in Germany, budget battles in France, and rising anti-EU sentiment in Italy and the Netherlands could swiftly unwind euro gains if tensions escalate. Should the ECB turn dovish to support a weakening labor market, the euro’s rally could reverse quickly 🗳️.
📈 7️⃣ Technical Picture: Overextension Warning
In addition to the macro drivers, EUR/USD is now technically overextended. The pair has already retraced exactly 78.6% of its major bearish trend that started in January 2021 and ended in September of that year. Ahead lies a strong resistance zone at 1.18000–1.20000, which will be difficult to break without a significant catalyst.
Notably, the daily chart shows bearish RSI divergence, indicating fading momentum beneath the surface of this rally. A pullback toward the 1.13000 level would not be surprising, even as near-term momentum remains strong. This technical setup calls for caution while the pair tests these critical levels.
📈 Technical Outlook: EUR/USD Showing Signs of Overextension
Beyond macroeconomic factors, EUR/USD is currently technically overextended. The pair has retraced exactly 78.6% of its major bearish trend that began in January 2021 and concluded in September the same year. It is now approaching the upper boundary of a 3-year ascending channel, facing a significant resistance zone between 1.18000 and 1.20000—a hurdle unlikely to be crossed without a strong catalyst.
Additionally, the weekly chart reveals a bearish RSI divergence, signaling that underlying momentum is weakening despite the recent rally. Given this, a pullback toward the 1.13000 level is plausible, even as short-term momentum remains robust. This technical setup advises caution as the pair navigates these critical resistance levels.
GBPAUD: Weekly Reversal | COT & Seasonality Support Bullish📊 Technical Outlook
Price strongly reacted from a key weekly demand zone between 2.0400 and 2.0500, showing clear absorption of bearish pressure. The RSI is rebounding from the 30 area, signaling early reversal potential.
The next technical target lies between 2.08900 and 2.10000, within a well-defined supply zone.
An early bullish reversal is in progress, with potential for a swing move toward the red zone.
🧠 Commitment of Traders (COT Report – 08/07/2025)
GBP: Non-commercial traders are net long, with positioning growing across the board: +869 longs / -926 shorts. Commercials reduce shorts and increase longs → Bullish bias.
AUD: Non-commercials are clearly short (-2,267 longs / +1,957 shorts). Commercials are increasing long exposure (+2,629), but still in the minority → Bearish bias.
➡️ The COT spread confirms a GBP long vs AUD short bias.
📅 Seasonality (July)
GBP: Historically strong in July, with average monthly gains across all timeframes (especially the 2Y window).
AUD: Less favorable seasonal profile in July; flat to slightly negative across all time horizons.
➡️ Seasonality supports GBP strength.
📉 Retail Sentiment
58% Long / 42% Short on GBPAUD
➡️ Retail traders are still heavily long → a shakeout of weak long hands is possible before the real rally begins.
🎯 Strategic Conclusion
GBP shows bullish convergence across technical, COT, and seasonal factors. AUD presents clear weakness.
The current price zone offers a clean entry point for longs, targeting the 2.08900–2.10000 supply zone.
EURJPY Hits Major Weekly Supply | Is the Bull Run Over?EUR/JPY – Institutional Macro Context (COT)
EUR (Euro)
Non-commercials net longs increased by +16,146 → strong buying.
Commercials added +25,799 long positions.
✅ Bias: Moderately bullish.
JPY (Japanese Yen)
Non-commercials decreased longs by -4,432.
Commercials cut -20,405 long contracts.
❌ Bias: Bearish pressure remains on JPY.
Conclusion (COT): EUR remains fundamentally strong, JPY structurally weak. Institutional flows favor long EUR/JPY, but positioning is stretched.
Seasonality (July)
EURJPY shows strong bullish seasonality in July, especially over the 2Y and 5Y averages (+1.03% and +0.66% respectively).
✅ Seasonality bias: Bullish.
Retail Sentiment
89% of traders are short on EUR/JPY.
Contrarian bias = bullish confirmation.
Technical Analysis (Weekly View)
Price is pushing into a major weekly supply zone around 172.50–173.00.
RSI still elevated but showing signs of weakening momentum.
Potential double top structure forming in confluence with liquidity grab.
First downside target sits around 169.50 (daily demand zone).
Awaiting a reaction in supply and confirmation for short.
Trading Plan (Top-Down)
Wait for price to reject the 172.50–173.00 area
Watch for bearish confirmation on Daily (engulfing or lower high)
Target: 169.50 zone
Risk: tight above 173.20 (invalidating supply zone)
Smart Money Reloading: Will EUR/USD Explode from Demand Zone?📊 Technical Context (Daily)
EUR/USD is currently in a corrective phase following the strong June rebound from the 1.1450 area, which culminated in a high near the 1.1850 supply zone.
The recent bearish move has pushed the pair back into a key demand area between 1.1450 and 1.1550, a zone that has acted as support multiple times in the past.
The latest weekly candle shows a potential bullish exhaustion signal (long lower wick), with the RSI hovering in oversold territory.
📌 Primary scenario: Possible consolidation above 1.1550 followed by a bullish continuation toward 1.1750–1.1800.
📌 Alternative scenario: Break of the recent lows could lead to a deeper retest of the 1.1350 zone.
📈 COT (Commitment of Traders)
Non-commercial positioning shows growing bullish interest in the euro:
EUR: +971 new longs, -6,654 shorts → strong increase in net long exposure.
USD Index: -267 longs, +92 spreads → signs of institutional indecision on the dollar.
This suggests a favorable shift toward the euro by smart money.
💡 Retail Sentiment
Retail traders remain heavily short on EUR/USD (63% short) with an average entry price of 1.1579.
This reinforces the contrarian bullish case, as retail traders are trapped short in a potential reversal zone.
📆 Seasonality
Historically, July has been a bullish month for EUR/USD:
➕ 2Y average return: +0.0287
➕ 5Y average return: +0.0166
This supports a seasonal bullish bias aligning with the current technical setup.
✅ Operational Outlook
EUR/USD is trading at a technically and macroeconomically significant area. The confluence of:
Weekly demand zone being tested
RSI in oversold conditions
COT positioning favoring the euro
Retail sentiment skewed short
Bullish seasonality
…makes a bullish bounce plausible in the coming weeks, with a first target at 1.1750. Invalidation level below 1.1450.
📌 Bias: Moderately Bullish
📍 Technical Activation Zone: Above 1.1550 with confirmed bullish price action
Earnings Heat Up - 6300 and 6200 SPX Key Levels RemainMarket Update
SPX Key Levels
-SPX poked 6300 Tuesday, Thursday, and poked higher Friday (but settled back to 6300)
-6200 support remains a key level
-6050/6000/5800 next floor levels, I'll be looking for dips
I can see the market slowly (and I mean SLOWLY) grinding higher but preparing for a
reasonable seasonal selloff through end of July into end of September window
July 28-August 1 is a monster week in the markets
-Megacap Earnings (MAG7 Tue/Wed/Thu)
-Wed July 30 - FOMC (Pause expected but Powell's Press Conference is important)
-Friday August 1 - Non-Farm Payroll, Tariff Deadline
I'm hitting fresh YTD highs so I'm not complaining about this melt-up and grind, I'm simply wanting to allocate positions and add to my positions at better levels and with a slightly
higher VIX to help take advantage of the expected move being greater than the actual move
Have a great weekend and thank you watching!!!
NZD/USD Ready to Explode? The Smart Money Is Making a MoveBias: Bullish Bounce from Key Demand Zone
NZD/USD is testing a strong confluence zone:
Long-term ascending trendline support
Weekly demand area between 0.5890 and 0.5940
Bullish RSI divergence near oversold conditions
The triple rejection wicks signal strong demand around 0.5900, suggesting a possible reversal toward the 0.6020–0.6050 resistance area.
🧠 COT Insight:
NZD: Non-commercial traders added +669 long contracts and reduced shorts by -102 → net bullish shift
USD: Net short exposure increases; total non-commercial shorts now exceed longs by ~4000 contracts
Implication: institutions are rotating into NZD while trimming USD exposure
📊 Sentiment:
86% of retail traders are long NZD/USD → retail sentiment is heavily skewed
This could delay or limit upside as smart money often moves counter to retail positions
📅 Seasonality (July):
July has historically been a bullish month for NZD/USD across all reference windows (20Y, 15Y, 10Y, 5Y, 2Y)
Average July return consistently positive → adds conviction to bullish thesis
🗺 Outlook:
If the zone at 0.5880–0.5920 holds, price may bounce toward 0.6020–0.6050.
Break below would invalidate structure and expose 0.5850 and then 0.5780.
Clear Entry, Clear Targets! Strategy Kicks Off with EUR/JPYHey everyone 👋
📌 SELL LIMIT ORDER / EUR/JPY Key Levels
🟢 Entry: 172,779
🎯 Target 1: 172.598
🎯 Target 2: 172.389
🎯 Target 3: 171,775
🔴 Stop: 173.097
📈 Risk/Reward Ratio: 3.17
I double-checked the levels and put together a clean, focused analysis just for you. Every single like seriously boosts my motivation to keep sharing 📈 Your support means the world to me!
Huge thanks to everyone who likes and backs this work 💙
Our goals are crystal clear, our strategy is solid. Let’s keep moving forward with confidence and smart execution!
Pound under pressure ahead of US, UK inflation reportsThe British pound has edged up higher on Tuesday. In the European session, GBP/USD is trading at 1.3453, up 0.21% on the day. Earlier, GBP/USD touched a low of 1.3416, its lowest level since June 23.
All eyes will be on the UK inflation report for June, which will be released on Wednesday. Headline CPI is expected to remain unchanged at 3.4% y/y, as is core CPI at 3.5%. Monthly, both the headline rates are expected to stay steady at 0.2%.
Has the BoE's battle to lower inflation stalled? The BoE was looking good in March, when inflation eased to 2.6%, but CPI has rebounded to 3.4%, well above the BoE's inflation target of 2%. Services data has been especially sticky, although it dropped to 4.7% in May, down from 5.4% a month earlier.
At 3.4%, inflation is stuck at its highest level since February 2024 and that will complicate plans at the BoE to renew interest rate cuts in order to kick-start the weak UK economy. The central bank has lowered rates twice this year and would like to continue trimming the current cash rate of 4.25%. The Bank meets next on Aug. 7 and Wednesday's inflation data could be a significant factor in the rate decision.
In the US, if June inflation data rises as is expected, fingers will quickly point to President Trump's tariffs as finally having an impact. Recent inflation reports have not shown a significant spike higher due to the tariffs, which were first imposed in April. However, the tariffs may have needed time to filter throughout the economy and could be felt for the first time in the June inflation reading.
The Fed meets next on July 30, with the markets pricing in a 95% chance of a hold, according to CME's FedWatch. For September, the odds of a rate cut stand at 59%. Today's inflation report could cause a shift in these numbers.
GBP/USD tested resistance at 1.3454 earlier. Above, there is resistance at 1.3484
1.3396 and 1.3366 are the next support levels
USDJPY – Tactical Short in Weekly Supply or Bullish Breakout?COT & MACRO FLOW (Commitment of Traders)
USD INDEX
Non-commercials still biased short: Longs 16,208 vs Shorts 20,194 (slightly improved, but still negative).
Commercials remain net long, but the open interest is declining → no strong conviction from smart money.
JPY
Non-commercials added significantly to their short exposure (+6,751), while cutting longs (-4,432).
Commercials also cut long exposure heavily (-20,405).
The structure shows institutional bias is clearly bearish on JPY.
Conclusion: JPY weakness confirmed by both commercial and non-commercial flows. USD slightly weaker, but JPY is weaker → supports USDJPY bullish bias.
SEASONALITY (JULY)
USD/JPY tends to be weak in July across most historical averages (5y, 10y, 15y, 20y).
July is historically bearish for USDJPY, especially in the second half of the month.
This seasonality contrasts with COT flows → mixed bias.
RETAIL SENTIMENT
60% of retail traders are SHORT → supports contrarian long view.
Retail volume shows imbalance in positioning, another contrarian bullish signal.
📈 TECHNICAL ANALYSIS (DAILY CHART)
Price is testing a key weekly FVG zone between 148.4 and 149.2.
RSI has re-entered the overbought region, suggesting potential exhaustion.
Price bounced from the monthly bullish order block (143.5–144.0).
A clear move above 149.50 could invalidate short setups.
🧩 TRADE IDEA (SETUP)
Watch for price to retest 148.4–149.50 zone and react.
RSI divergence + seasonality could offer a short opportunity with confirmation (e.g. engulfing on Daily/H4).
If price breaks above 149.5 with volume → look for continuation to 152.00.
✅ FINAL BIAS
Macro and institutional flows remain in favor of USDJPY longs, but:
Seasonality turns bearish in the second half of July
Price is reaching strong resistance
Retail sentiment supports the long thesis
→ Tactical Short from 149-150 only with confirmation. Otherwise, long continuation above 150.
What Happens the Day Jerome Powell Is Fired or Quits?A sudden exit by Fed Chair Jerome Powell would create both a political and monetary shock.
While the Chair is technically protected from arbitrary removal. Recent reports confirm that President Trump and his allies are scrutinising the Fed’s $2.5 billion renovation project—potentially laying the groundwork for a “for cause” dismissal.
A surprise departure would undermine confidence in the Fed’s independence. The U.S. dollar could fall sharply across major pairs.
USD/JPY could fall toward ¥145, with safe-haven demand favouring the yen. However, the reaction may be less severe than in pairs like Swiss franc which we have noted in the past is the potentially preferred safe haven. A panic selloff could extend to 142.20—a prior consolidation floor.
GBP/USD could surge as traders anticipate a more dovish Fed stance under the new Trump-stooge Fed Chair. From a technical perspective, GBP/USD is maybe already oversold and potentially poised for a potential rebound anyway—Powell’s resignation or firing could potentially exacerbate this. The first level to watch being a return to 1.3700, assuming the likely expectation of Fed rate cuts rise.
Weekly Macro Brief: Chinese Economic Data, US Inflation, Tariff CME_MINI:ES1! CME_MINI:NQ1! COMEX:GC1! CME:BTC1! CME_MINI:RTY1! COMEX:SI1! CME_MINI:MNQ1! NYMEX:CL1! CME_MINI:M6E1! CBOT:ZN1! CME_MINI:MES1!
Highlights this week include Chinese economic data points, UK CPI, US CPI, PPI, and Retail Sales. Inflation data is key, as it comes ahead of the Fed's meeting on July 30th, 2025.
Market participants, including institutional investors and futures brokers like EdgeClear, will be scrutinizing these data points closely to monitor global growth and underlying inflation pressures.
Fed speakers are scheduled throughout the week. With increasing calls for Fed Chair Powell voluntary resignation and impeachment, the US administration desiring lower rates, the Fed’s independence and credibility to carry out its dual mandate is at risk. It will be interesting to monitor who folds first. Last week’s FOMC minutes revealed a divided Fed on the interest rate outlook, affirming its June dot plot.
On the fiscal policy front, we are already witnessing a shift in global trade policies, with many nations making concessions to negotiate trade deals with the world’s largest economy. In our analysis, the inflation impact of tariffs may not show up until Q4 2025 or early 2026, as tariff threats are mostly used as a lever to negotiate deals. While effective tariff rates have increased, as Trump reshapes how tariffs are viewed, cost pass-through to consumers will be limited in Q3 2025, as companies’ front-loaded inventory helps mitigate the risks of increased tariff exposure.
So, what we have is an interesting development shaping up where, while inflation may rise and remain sticky, it is yet to be seen whether slowing consumer spending will weaken enough to the point where companies have to start offering discounts, which would nullify the tariff risk to the end consumer and result in companies absorbing all tariffs. This scenario will see reduced earnings margins leading into the last quarter and early 2026. However, it will materially reduce risks of higher inflation.
In summary, the complex interplay between tariffs, inflation, and consumer behavior presents critical considerations for traders. EdgeClear, as a dedicated futures broker, remains focused on equipping clients with the insights needed to help navigate this evolving macroeconomic environment.
Overnight Data Recap:
• Chinese Trade Balance (CNY)(Jun) 826.0B (Prev. 743.6B)
• Chinese Trade Balance USD* (Jun) 114.77B vs. Exp. 109.0B (Prev. 103.22B)
• Chinese Imports YY* (Jun) 1.1% vs. Exp. 1.3% (Prev. -3.4%)
• Chinese Exports YY* (Jun) 5.8% vs. Exp. 5.0% (Prev. 4.8%)
Key Economic Releases:
• MON: EU 90-Day Retaliatory Pause Ends
• TUE: OPEC MOMR, Chinese House Prices (Jun), Retail Sales (Jun), GDP (Q2), EZ Industrial Production (May), German ZEW (Jun), US CPI (Jun), NY Fed Manufacturing (Jul), Canadian CPI (Jun)
• WED: UK CPI (Jun), EZ Trade (May), US PPI (Jun), Industrial Production (Jun)
• THU: Japanese Trade Balance (Jun), EZ Final HICP (Jun), US Export/Import Prices (Jun), Weekly Claims, Philadelphia Fed (Jul), Retail Sales (Jun)
• FRI: Japanese CPI (Jun), German Producer Prices (Jun), US Building Permits/Housing Starts (Jun), Uni. of Michigan Prelim. (Jul)
China GDP / Retail Sales/ Housing (TUE):
• Q2 GDP is expected to slow to 5.1% Y/Y (vs 5.4% in Q1) and 0.9% Q/Q.
• Retail sales have been resilient, but industrial production and investment show signs of weakness; deflation and labor market concerns persist.
• Property prices continue to decline, fueling stimulus speculation; policymakers remain cautious, with only modest easing expected (LPR and RRR cuts in Q4).
US CPI (TUE)
• June CPI expected at +0.3% M/M headline and core, suggesting a modest rebound from May’s subdued figures.
• Inflation impact from tariffs seen as temporary; Fed officials maintain a cautious stance with possible rate cuts only if price pressures stay benign.
• Markets are pricing near-zero odds for a July rate cut, but still expect two 25bps cuts by year-end in line with Fed guidance.
US Retail Sales (THU):
• Headline June retail sales expected flat M/M; ex-autos expected to rise +0.3%, showing signs of consumer stabilization.
• BofA data shows mild spending rebound, though discretionary service spending continues to weaken, especially among lower-income households.
• Spending strength remains concentrated in higher-income cohorts; weakness in wage growth limits broader consumption momentum.
US Trade Tensions – Tariffs & Negotiations:
• Trump announced 30% tariffs on EU and Mexican goods effective August 1st, separate from sector-specific tariffs.
• Trump stated the EU is engaging in talks and South Korea is also pursuing a trade deal.
Mexico Response:
• President Sheinbaum expects a deal before August 1st but reaffirmed Mexican sovereignty is non-negotiable.
• Mexico’s Economy Ministry is negotiating to protect domestic firms and workers, aiming for an alternative resolution.
EU Response:
• European Commission President von der Leyen warned that 30% tariffs would disrupt key transatlantic supply chains.
• The EU will extend suspension of countermeasures until early August but is prepared to respond proportionally if needed.
• The EU prefers a negotiated solution and dropped plans for a digital tax, seen as a concession to US tech interests.
• Separately, the EU is drafting a broad corporate tax on firms with turnover above EUR 50 million to support its budget.
Soybeans Loading a Bounce? Demand Zone + COT1. Price Action & Technical Structure
Price has bounced off a strong daily demand zone (1011–969).
Today’s daily candle shows a clear rejection wick from the low, and RSI is signaling a potential reversal.
The market is trading inside a falling channel, currently near the lower boundary — setting up a possible breakout move.
Technical Targets:
• First upside target: 1039–1049
Invalidation: daily close below 990, which would confirm structural breakdown.
2. COT Report – Soybeans Futures (as of July 9, 2025)
• Non-Commercials:
+11,539 spreads | +7,017 shorts | –7,520 longs → Slight bearish pressure, though spreads suggest growing speculative complexity.
• Commercials:
+7,876 longs | –9,084 shorts → Moderate commercial bullish bias.
• Open Interest:
+8,076 contracts → Market activity increasing.
Overall COT positioning is neutral to slightly bullish, with growing signs of accumulation around the 1000 level.
3. Seasonality – MarketBulls
Historically, July is one of the weakest months for Soybeans:
• –44.82 (20Y avg)
• –36.86 (15Y avg)
• –34.74 (10Y avg)
However, early August shows signs of seasonal recovery, and price action is already diverging from typical seasonal behavior.
This makes a deeper breakdown less likely — we could be nearing the end of the seasonal weakness.
Operational Takeaway
Current Bias: Neutral-to-Bullish
Confluence of signals supports the idea of a technical rebound:
✅ Bullish reaction candle in demand
✅ Fibonacci support + lower trendline touch
✅ COT data stabilizing with rising open interest
✅ Seasonal weakness possibly exhausted
EURJPY Hits Supply | Pullback Is ComingPrice has entered the daily supply zone (red area) between 170.80 and 171.80, showing immediate rejection with a long upper wick — a signal of potential short-term bearish reaction.
The RSI is turning lower, indicating loss of momentum, although it hasn’t reached extreme levels yet.
The current map suggests a technical pullback toward the 169.40–168.50 zone (FVG + dynamic support) before any potential bullish continuation toward 174+.
The overall structure remains bullish, but a correction looks likely due to technical exhaustion and retail positioning.
📊 2. COT Report (JPY Futures – as of 2025-07-01)
Non-Commercials (speculators) reduced long positions on the JPY by -7,779 contracts, and also slightly trimmed shorts → clear sign of position reduction.
Net positioning remains strongly negative (JPY weakness), but it's starting to recover slightly.
Commercials added both longs (+2,830) and shorts (+5,977), indicating indecision but growing interest.
Open interest slightly decreased (–516), though it remains elevated.
👉 The market has not yet reversed, but the JPY downtrend may be approaching exhaustion.
🧠 3. Retail Sentiment
86% of retail traders are short EUR/JPY — a strong contrarian bullish signal.
Average retail short entry: 166.27, while current price is 171.55 → retail traders are trapped and under pressure.
A short squeeze is likely underway or already completed, increasing the risk of a technical correction after distribution.
📅 4. Seasonality
July is historically weak for EUR/JPY:
20Y: -0.35
15Y: -0.49
10Y: -0.18
August tends to be even worse from a seasonal perspective.
This supports the idea of a potential pullback in the coming days or weeks.
Trading Conclusion
Current Bias: Short-term Neutral–Bearish, Medium-term Bullish.
✳️ Potential pullback from 172.30 toward 169.40–168.50
🎯 If price holds and builds clean bullish structure, expect continuation toward 174.00–175.00
❌ Invalidation on daily close below 167.80
EUR/USD Reversal Ahead? COT + DXY Strength Signal Price has broken below the ascending channel that started in mid-May.
The current candle is rejecting the weekly supply zone (1.17566–1.18319), leaving a significant upper wick.
Daily RSI is losing strength but has not yet reached extreme levels.
A key daily Fair Value Gap (FVG) lies between 1.1600 and 1.1480, with the first potential downside target at 1.14802, which aligns with support and the FVG zone.
A deeper bearish continuation could push price towards 1.1350, but only if the FVG lows are clearly broken.
📊 COT Data (CME - Euro FX & USD Index)
Euro FX
Net long: +15,334
Commercials increased both longs (+13,550) and shorts (+9,913) → mild divergence.
Non-Commercials (speculators) increased shorts (+4,786) more than longs (+1,188) → speculative bias tilting bearish.
USD Index
Strong net long accumulation across all trader types: +4,597 net.
Non-Commercials added +3,590 longs, with only a minor increase in shorts.
→ USD strength continues, reinforcing potential weakness in EUR/USD.
🧠 Retail Sentiment
67% of retail traders are short EUR/USD → typically a contrarian bullish signal.
However, the price is already showing distribution, not accumulation, so we may see price push lower first to trap remaining retail longs, invalidating the contrarian signal in the short term.
📅 Seasonality
July is historically bullish, especially on the 2Y (+0.0142) and 10Y (+0.0106) averages.
However, the 15Y and 20Y averages show a much more moderate performance (+0.007 / +0.0025).
Based on current price action, the seasonal rally may have already played out with the run-up to 1.1830. A correction now seems likely, even if the broader macro remains supportive mid-term.
🧩 Conclusion
Despite historically bullish seasonality for July, both price action and COT data indicate distribution with early signs of reversal.
Retail sentiment is too skewed short for a major breakdown just yet, but the technicals support a short-term pullback toward more balanced levels.
USD strength from COT and DXY structure reinforces a corrective short bias for now.
EURAUD Breakdown Incoming? Price + COT + Seasonality🧠 MACRO & INSTITUTIONAL FLOWS (COT)
EURO (EUR)
Strong increase in net long positions by non-commercials: +16,146
Commercials also added long exposure: +25,799
Bias: moderately bullish
AUSTRALIAN DOLLAR (AUD)
Non-commercials remain heavily net short (long/short ratio: 15% vs 63.6%)
Slight increase in commercial longs: +2,629
Bias: still bearish, but showing early signs of positioning exhaustion
COT Conclusion: EUR remains strong, AUD remains weak — but the recent extension calls for caution on fresh EURAUD longs.
📊 SEASONALITY (JULY)
EUR shows historically positive July performance across 2Y, 5Y, and 10Y averages
AUD also shows mild strength, but less consistent
🔎 Net differential: No strong seasonal edge on EURAUD in July
📈 RETAIL SENTIMENT
54% of retail traders are short EURAUD, 46% long
Slight contrarian bullish bias, but not extreme yet → neutral to slightly long
📉 TECHNICAL STRUCTURE – MULTI-TIMEFRAME
1. Weekly Chart
Strong bearish engulfing candle after 4 weeks of upside
RSI dropped below 50 → clear momentum shift
1.7960–1.8100 is now a liquidity zone that’s been tapped
2. Daily Chart
Confirmed break of the ascending channel formed since May
Price reacted from demand zone around 1.7460–1.7720, signaling potential pullback
Watch for rejection around 1.7910 (50% body of the weekly engulfing candle)
3. Entry Setup
Key area for short entries: 1.7910–1.7940
This zone aligns with:
✅ Former support now turned resistance
✅ Inside a valid bearish order block
✅ Ideal retracement level (50% engulfing body)
🎯 OPERATIONAL CONCLUSION
While the macro context still favors a stronger EUR against AUD, price action tells another story.
The weekly engulfing candle is a strong technical reversal signal, and the daily structure confirms the break.
→ Shorting the pullback into 1.7910–1.7940 could offer an excellent R/R trade setup.
Bias: Short-term bearish – Targeting 1.7700, 1.7550, and potentially 1.7315
Invalidation: Daily close above 1.8040
XAUUSD - Will Gold Continue Its Rise?!Gold is trading above the EMA200 and EMA50 on the hourly chart and is trading in its ascending channel. We still have a bullish view on this commodity and we can expect to see $3,350. A correction towards the bottom of the ascending channel will also provide us with a better risk-reward buying opportunity.
According to the World Gold Council, physically backed gold ETFs attracted around $38 billion in investments during the first half of 2025. This marks the largest semi-annual inflow since the beginning of 2020. The remarkable surge is primarily attributed to heightened investor demand for safe-haven assets amid escalating economic and trade tensions triggered by President Trump’s tariff policies.
During this period, the total gold holdings of these funds grew by 397.1 tonnes, bringing their global assets to 3,615.9 tonnes by the end of June—the highest level since August 2022, although still below the all-time high of 3,915 tonnes recorded in October 2020.
U.S.-based funds led the inflows with an addition of 206.8 tonnes, while Asian funds—despite accounting for only 9% of total assets—captured 28% of global inflows, highlighting a significant rise in interest among Asian investors in gold.
This positive trend emerged after three consecutive years of outflows between 2021 and 2023, followed by modest inflows in 2024. Concurrently, gold prices have surged by 26%, reaching a record high of $3,500 per ounce in April.
The World Gold Council, established in 1987 and headquartered in London, is funded by major gold mining companies. Its main objectives include boosting global demand for gold, enhancing market accessibility, and promoting innovation within the gold industry. The council plays a crucial role in shaping global perceptions of gold as a financial asset.
However, some analysts argue that the council essentially functions as a powerful lobbying group for mining corporations, often releasing reports designed to bolster demand and foster a positive market sentiment toward gold.
On the other hand, Bank of America (BofA), in its latest report using a global trading time framework, analyzed the outlook for the U.S. dollar in the second half of 2025. Despite the dollar having its worst start to a year since 1973, the report suggests that selling pressures on the currency may ease going forward, particularly during U.S. trading hours.
U.S. Trading Hours and Federal Reserve Policy
The dollar’s cumulative performance during U.S. trading hours remains strongly correlated—at 71%—with Federal Reserve interest rate pricing. Given expectations for stable rates throughout the rest of the year, the dollar could find some support during this time frame.
Asia: The Main Driver of Dollar Selling in H1 2025
Asian investors were the largest sellers of the dollar during the first half of 2025. However, after fully unwinding the long positions accumulated over the past two years, dollar performance in Asian trading hours has now turned neutral. Fresh selling may remain limited unless new bearish catalysts emerge.
Europe: Tied to Global Equities’ Performance
Dollar weakness during European trading hours largely depends on the relative strength of global equities versus U.S. stocks. As U.S. equities reclaimed market leadership in the second quarter, European investors may have less incentive to continue selling dollars.
Decline in Currency Hedging Appetite
Following the dollar’s significant drop in the first half of the year, foreign investors are now less inclined to increase currency hedges on their dollar-denominated assets.
According to Bank of America’s trading time framework, the pace of the dollar’s decline is likely to slow in the second half of the year, especially during U.S. trading hours, as stable Federal Reserve policy removes a key bearish factor. Selling pressure from Asia is also expected to ease unless new downside triggers arise. The key variable going forward will be the relative performance of global equities versus U.S. markets.
