EUR/USD remains under pressure amid ongoing uncertainty in global trade and robust demand for the US dollar as a safe haven.
Possible technical scenarios:
As evidenced by the daily chart, EUR/USD is testing the 1.1738 support level. If quotes consolidate below, the price weakening may continue to 1.1494 in the medium term.
Fundamental drivers of volatility:
Progress in the EU-US tariff talks has somewhat reduced the risks of new restrictions from Washington, but this has only temporarily supported the euro. Market participants' expectations remain subdued, as the White House's trade rhetoric may escalate again at any moment
The fundamental picture in the eurozone remains weak: retail sales fell 0.7% in May, the largest in almost two years, reflecting a deterioration in consumer sentiment. The increase in Germany's trade surplus, although positive, is due to a decline in imports, which indicates a slowdown in domestic demand. Despite the unexpected recovery in industrial production, overall economic data does not provide support for the euro.
This week, the key event will be the publication of the minutes of the Fed meeting, from which markets are waiting for signals about the mood in the interest rate committee. If the minutes indicate disagreements or a tendency for some members to ease, this may adjust expectations for the dollar. However, until the publication of the minutes, the dollar is likely to remain in a stronger position amid global risks and weakness in European indicators.
Intraday technical picture:
AGiven the unfolding scenario on the 4H chart of EUR/USD, we see the formation of a local downtrend. If it continues, the pair's weakening may reach the nearest support level of 1.1617 marked with a dotted line.
The British pound is showing moderate gains against the US dollar on Tuesday amid the market reaction to fresh tariff threats from President Trump, although the pair has remained under pressure since the beginning of July.
Possible technical scenarios:
The daily chart shows that the GBP/USD pair dropped below the 1.3630 level. A consolidation there will open the way for quotes to the next downside target at 1.3436.
Fundamental drivers of volatility:
The pound is strengthening against the dollar amid a temporary decrease in demand for the American currency after Trump's tariff threats, which have increased concerns about a slowdown in global trade.
Despite this, the dollar retains the potential for recovery ahead of the publication of the FOMC minutes, which may provide signals about the future monetary policy of the United States. Markets remain wary, and further dynamics of the pair will depend on the news and rhetoric of the Fed.
Two key events remain the focus of investors this week. These are the publication of the FOMC minutes on Wednesday and the UK GDP data for May on Friday. The American regulator maintains cautious rhetoric, expecting clearer signals on the impact of tariff policy on inflation.
TAt the same time, moderate growth of 0.1% is expected from UK GDP, which may support the pound in the short term, but will not fundamentally change the overall pressure from domestic macroeconomic and political factors.
Intraday technical picture:
According to the 4H chart of GBP/USD, consolidation under the mirror level of 1.3630 creates preconditions for further weakening of the price. Renewal of the lows from July 2 will allow quotes to continue their downward path to the level of 1.3436.
USD/JPY is rising this week amid yen weakness due to the Bank of Japan's continued caution on interest rate hikes.
Possible technical scenarios:
TOn the daily chart, USD/JPY has broken out the 145.91 resistance and is trying to consolidate above it. If successful, the next upside target will be 148.63.
Fundamental drivers of volatility:
The yen is trading under pressure as US tariffs, in particular the 25% tariffs on Japanese goods, increase uncertainty and make it more difficult for Japan to normalize its monetary policy.
Adding additional pressure on the yen is weak domestic macroeconomic data - real wages in May showed the largest drop in the last 20 months, which undermines the case for tightening policy by the Bank of Japan.
However, demand for the US dollar is restrained ahead of the FOMC minutes and concerns about the impact of a new wave of tariffs on the global economy. If the Fed confirms that it is in no hurry to raise rates and geopolitical tensions persist, the yen could receive moderate support as a safe-haven asset. However, the overall fundamental background remains in favor of the dollar, and the USD/JPY pair will depend on the balance between Fed rate expectations and the Bank of Japan's actions.
Intraday technical picture:
Locally, on the 4H chart, we see price consolidation at the support level of 145.91, which creates the preconditions for further growth. The nearest target for USD/JPY strengthening will be the highs of June 23 (148.02).
The USD/CAD pair held above 1.3600 and shows technical signs of further recovery.
Possible technical scenarios:
On the daily USD/CAD chart, we see that the pair is recovering within the sideways range between 1.3503 and 1.3744. Here, a double bottom reversal pattern is formed with a neckline of 1.3744. Upon reaching this level, a downward reversal and formation of the third bottom of the reversal pattern is possible. But if the 1.3744 level is broken out from bottom to top, there is a high probability of growth to the targets of 1.3861 and 1.4013.
Fundamental drivers of volatility:
The USD/CAD pair is falling on Tuesday amid a weakening US dollar after President Trump announced updated tariff rates for 14 countries.
Despite threats of tariffs of up to 40%, Canada was removed from the list of countries subject to new tariffs, which supports the stability of the Canadian dollar. The delay of the tariffs until August 1 and the openness of the US to further negotiations also create a favorable backdrop for the CAD.
At the same time, despite the current stability, the Canadian dollar faces a number of challenges, including the current US tariffs on steel, aluminum, and cars, as well as trade restrictions related to fentanyl.
These factors may limit the potential for further strengthening of the CAD, especially if trade tensions between the US and Canada escalate. In the near term, the dynamics of USD/CAD will depend on the development of trade negotiations and the reaction of markets to the US tariff policy.
Intraday technical picture:
Considering the recent developments on the 4H chart, the USD/CAD pair is in the middle of the range between the dotted support level at 1.3556 and the resistance at 1.3744, which retains the technical potential for a recovery to its upper border.
Oil prices fell on Tuesday amid uncertainty over new US tariffs and an expected increase in OPEC+ production in August.
Possible technical scenarios:
As we can see on the daily chart, the oil price is trying to consolidate above the broken-out level of 68.52, which, if successful, will open the way to the resistance of 70.62. A series of higher lows after last week's decline also speaks in favor of further growth.
Fundamental drivers of volatility:
Trump's trade tariffs create risks for the global economy and may negatively affect oil demand. And this is despite the continued high current demand, especially in the US, where the holiday season is contributing to an increase in fuel consumption. Now the important question is whether the high demand will be maintained, capable of absorbing the increase in production.
The Organization of the Petroleum Exporting Countries and their allies (OPEC+) agreed to a significant increase in production in August and plan a further increase in September, which virtually cancels out previous voluntary cuts.
Despite this, actual production increases have so far lagged behind the announced volumes, with Saudi Arabia accounting for the bulk of supply. In addition, oil demand is growing in countries such as India, which is supporting the market, although lingering trade risks and uncertainty may limit further price gains.
Intraday technical picture:
The local technical picture on the 4H chart demonstrates price consolidation above the support at 68.52. If this level holds, quotes will be open to the next target at 70.6.
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