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The US Dollar has started to show some signs of relative weakness after an almost flawless beginning to July.

Between a rebirth in Tariff talks, extended until the 1st of August and some general volatility in global Geopolitics, there has been some sell-side covering for the Greenback.

The rally has (at least for now) concluded through last week's bout of Middle East tensions (with intense Syrian local conflicts), encouraging PPI Data and FED's Waller starting the Blackout Period from the US Central Bank with some repeating of his dovish comments.

For those who haven't seen the headlines, Japan's Prime Minister and his electorate have lost the majority which has created some movement in JGBs (Japanese Governement Bonds) and led to a strengthening of the Yen (with Japan markets off today) – Another contributor of a weaker dollar to start the week – USDJPY is down close to 1% on the session.

Markets were also concerned by talks around Jerome Powell, whose term finishes in May 2026, getting fired from his FED Chair role – US Treasury's Scott Bessent has denied such outcomes, however markets had still sold off some treasuries which trickled to the Dollar on the last weekly close – Any possibility has to get priced in!

Let's take a look at what technicals indicate to spot potential trends for this starting week.

Dollar Index Technical update

Dollar Index 1H Chart

Dollar Index 1H Chart, July 21, 2025 – Source: TradingView

The Dollar came shy of the 99.00 psychological handle – A failure to breach that landmark has been seen as a sign of weakness despite a solid July tenure and some testing of higher levels through risk-off spikes.

Failed patterns and breaks are the best signs for reversals, and the last spike on Thursday to form a double-top was a good example for this.

Since, the Index is down close to 1 full handle, with prices consolidating in the 98.00 Pivot Zone (+20 pips) and currently breaking the psychological level.

Sellers are taking the momentum, as they are currently pushing through the 97.98 overnight lows pursuing the break-retest of the July Channel.

Watch for other currency pairs and assets how this dynamic trickles – Gold is also up 1.10% on the session and close to $3,400.

Stepping back to the 4H Chart

Dollar Index 4H Chart, July 21, 2025 – Source: TradingView

There is a move down ongoing, which gets also reflected in the 4H RSI trading below its neutral zone (neutral is typically close to the middle line).

There has been a golden cross between the 50 and 200 MAs on Friday which led to some bull candles, however such technical patterns can come late and have done just that.

Buyers will look at the 97.60 Support Zone (+/-10 pips) to show some presence – Selling outflows from the US are still potentially massive with the short-term positioning having became more neutral in the past two weeks – Still, the week is young and markets will have to slow down a bit towards next week as they will prepare for the July 31st FED Meeting.

Levels to place on your charts:

Support Levels:

• 97.60 Support Zone (+/-10 pips)
• 97.30 last pivot before run-higher
• 96.50 2025 Lows

Resistance Levels:

• 98.00 Major Pivot Zone (50 and 200 MA Confluence)
• 98.50 Gap/Resistance Zone
• 98.95 to 99.00 Last week highs

Safe Trades and successful week!

Daily Pivots: (S1) 1.1587; (P) 1.1630; (R1) 1.1667; More...

Intraday bias in EUR/USD stays neutral and outlook is unchanged. Fall from 1.1829 might extend lower, and sustained trading below 55 D EMA (now at 1.1498) will argue that it's already correcting the rally from 1.0176, and target 38.2% retracement of 1.0176 to 1.1829 at 1.1198. On the upside, though, break of 1.1720 will bring retest of 1.1829 high.

In the bigger picture, rise from 0.9534 long term bottom could be correcting the multi-decade downtrend or the start of a long term up trend. In either case, further rise should be seen to 100% projection of 0.9534 to 1.1274 from 1.0176 at 1.1916. This will remain the favored case as long as 1.1604 support holds.

Daily Pivots: (S1) 1.3383; (P) 1.3429; (R1) 1.3455; More...

Intraday bias in GBP/USD stays neutral for the moment. On the downside, firm break of 1.3363/9 will suggest that fall from 1.3787 short term top is already correcting the rise from 1.2099. Deeper decline should then be seen to 1.3138 cluster support (38.2% retracement of 1.2099 to 1.3787 at 1.3142). However, strong rebound from current level will retain near term bullishness. Break of 1.3561 support turned resistance will bring retest of 1.3787 high.

In the bigger picture, up trend from 1.3051 (2022 low) is in progress. Next medium term target is 61.8% projection of 1.0351 to 1.3433 from 1.2099 at 1.4004. Outlook will now stay bullish as long as 55 W EMA (now at 1.3017) holds, even in case of deep pullback.

Daily Pivots: (S1) 0.7982; (P) 0.8020; (R1) 0.8054; More….

No change in USD/CHF's outlook and intraday bias remains neutral. On the downside, break of 0.7946 support will argue that correction from 0.7871 has completed, and bring retest of this low. Nevertheless, firm break of 0.8054/63 will bring stronger rebound to 55 D EMA (now at 0.8140).

In the bigger picture, long term down trend from 1.0342 (2017 high) is still in progress. Next target is 100% projection of 1.0146 (2022 high) to 0.8332 from 0.9200 at 0.7382. In any case, outlook will stay bearish as long as 0.8475 resistance holds.

Daily Pivots: (S1) 148.39; (P) 148.64; (R1) 149.08; More...

USD/JPY dips lower today as consolidations continues below 149.17. Intraday bias stays neutral and further rally is expected as long as 55 D EMA (now at 145.86) holds. On the upside, break of 149.17 will target 100% projection of 139.87 to 148.64 from 142.66 at 151.43. That is close to 61.8% retracement of 158.86 to 139.87 at 151.22.

In the bigger picture, price actions from 161.94 (2024 high) are seen as a corrective pattern to rise from 102.58 (2021 low). There is no clear sign that the pattern has completed yet. But still, strong support is expected from 38.2% retracement of 102.58 to 161.94 at 139.26 to bring rebound.

Yen continues to lead the currency markets today, with fresh buying emerging in the early US session, particularly against Dollar. However, the rally appears more technical than structural, largely driven by short covering after Japan’s weekend election delivered no major surprises. Prime Minister Shigeru Ishiba’s Liberal Democratic Party lost its upper house majority, but the outcome had been widely anticipated.

Despite today’s gains, the broader outlook for Yen remains clouded by unfavorable fundamentals. Political uncertainty now looms larger, with Ishiba expected to cling to power through cooperation with opposition parties. That instability could complicate ongoing trade negotiations with the US, while keeping BoJ on the sidelines amid increased policy inertia.

Overall the currency markets, European currencies are also showing relative strength, led by Sterling which holds a mild edge over both Euro and Swiss Franc. On the other end, Dollar is underperforming, followed by commodity currencies including the Aussie and Kiwi and Loonie.

Tariff risks are back in focus following a Reuters report citing unnamed EU diplomats. US President Donald Trump’s threat of a 30% tariff by August 1 has raised alarm within the EU. Despite last week’s meetings between EU Trade Commissioner Maros Sefcovic and US officials, prospects for rolling back existing tariffs—such as the 50% on steel and 25% on autos—appear slim. The US has also floated baseline tariff rates well above 10%.

As the August 1 deadline approaches, EU policymakers appear more prepared to retaliate, even as they continue to prefer negotiation. A EUR 21B tariff package remains suspended until August 6, while another set targeting EUR 72B in US exports is under active consideration. More importantly, support is growing for deploying the EU’s anti-coercion instrument, though formal activation would require backing from a qualified majority.

Looking ahead, the upcoming RBA minutes will be closely scrutinized during the Asian session. This was the first meeting to reveal unattributed votes, showing a 6–3 split in favor of holding rates steady at 3.85%. The minutes may clarify whether it was a tactical delay or a sign of deeper dissent.

Technically, GBP/AUD could have formed a short term bottom at 2.0499 last week. Immediate focus is now on 2.0743 resistance and 55 D EMA (now at 2.0733). Sustained trading above this resistance zone will suggest that corrective pattern from 2.1643 has completed with three waves to 2.0499. Further rally should be seen to 2.1034 resistance next. Nevertheless, rejection by the EMA will extend the correction through 2.0439 before completion.

In Europe, at the time of writing, FTSE is down -0.09%. DAX is down -0.05%. CAC is down -0.41%. UK 10-year yield is down -0.061 at 4.618. Germany 10-year yield is down -0.068 at 2.629. Earlier in Asia, Japan was on holiday. Hong Kong HSI rose 0.68%. China Shanghai SSE rose 0.72%. Singapore Strait Times rose 0.42%.

ECB SAFE survey: Firms see slower inflation, trade shocks reorder priorities

The ECB’s latest SAFE (Survey on the Access to Finance of Enterprises) report showed that Eurozone firms have revised down their short-term inflation expectations while maintaining a cautious view on long-term price pressures. The median forecast for inflation one year ahead dropped to 2.5% from 2.9%. Expectations for three- and five-year horizons remained steady at 3.0%.

When asked about risks to five-year inflation, 52% of firms still viewed them as skewed to the upside, though that figure declined slightly from 55%. The share of firms seeing balanced risks increased to 33%, while those perceiving downside risks remained unchanged at 14%.

This round also included ad hoc questions about the impact of rising trade tensions, particularly recent US tariff announcements. The survey revealed uneven exposure across firms, with exporters to the US and manufacturing companies facing the greatest challenges. About 30% of respondents reported concerns over supply chain disruptions, including delays and shortages.

In response, many businesses are already pivoting. Firms cited plans to reorient sales toward domestic and EU markets and restructure supply chains to reduce dependency on vulnerable links.

NZ CPI rises to 2.7% yoy in Q2, tradeabales jump

New Zealand’s CPI rose 0.5% qoq in Q2, slightly below expectations for 0.6% qoq. Annual inflation ticked up to 2.7% yoy from 2.5% yoy but still undershot 2.8% yoy forecast. Headline inflation remained comfortably within the RBNZ’s target range of 1-3%. Tradeables inflation climbed sharply to 1.2% yoy from 0.3% yoy. Non-tradeables eased to 3.7% yoy from 4.0% yoy, indicating moderating domestic pressures.

The quarterly print showed notable increases in cultural services (+9.5% qoq), electricity (+4.9% qoq), and vegetables (+10.0% qoq), which together accounted for over 70% of the total quarterly CPI rise. However, these gains were partially offset by a -4.8% qoq drop in petrol prices and -9.2% qoq decline in domestic accommodation services.

USD/JPY Mid-Day Outlook

Daily Pivots: (S1) 148.39; (P) 148.64; (R1) 149.08; More...

USD/JPY dips lower today as consolidations continues below 149.17. Intraday bias stays neutral and further rally is expected as long as 55 D EMA (now at 145.86) holds. On the upside, break of 149.17 will target 100% projection of 139.87 to 148.64 from 142.66 at 151.43. That is close to 61.8% retracement of 158.86 to 139.87 at 151.22.

In the bigger picture, price actions from 161.94 (2024 high) are seen as a corrective pattern to rise from 102.58 (2021 low). There is no clear sign that the pattern has completed yet. But still, strong support is expected from 38.2% retracement of 102.58 to 161.94 at 139.26 to bring rebound.

Market Overview

The crypto market cap is once again approaching 4 trillion, currently standing at $3.96 trillion. The market returned to growth after Friday’s jump and rapid correction. Unlike in previous months, the main driver is the rise in altcoin prices, rather than the first cryptocurrency. This is an important indicator of buyer confidence. However, demand is currently focused on proven names such as Dogecoin (+33% in 7 days), Litecoin and Ethereum (both +25%) and XRP (+20%).

Bitcoin has not been able to maintain its growth over the past week, consolidating around $118K after updating its historical highs. At such moments, enthusiasts carefully reduce their positions in BTC, increasing them in altcoins. Bitcoin has been gaining its share for almost three years, bringing it to almost two-thirds of the market. This is only slightly below the 70% range, which served as a kind of ceiling in 2019–2021.

XRP set a new all-time high above $3.66, the previous one having held for more than seven years. Since Trump’s victory in the US presidential election last November, XRP has risen by almost 600%. The frenzy was followed by a pullback to $3.35 over the weekend, close to previous peaks. Still, the price is recording its sixth consecutive daily gain, trading above $3.5, indicating a solid breakout to a new price level.

News Background

Weekly inflows into spot Bitcoin ETFs in the US have declined slightly but remain near 8-week highs; positive dynamics have been observed in 12 of the last 14 weeks. According to SoSoValue, net inflows into spot BTC ETFs over the past week amounted to $2.39 billion, totalling $54.75 billion since the approval of Bitcoin ETFs in January 2024.

Weekly inflows into spot Ethereum ETFs in the US jumped to $2.18 billion, setting record highs for the second week in a row. Total net inflows since the ETF’s launch in July 2024 have grown to $7.49 billion.

The inflow of capital into Ethereum could have intensified against the background of BlackRock’s application to the SEC to add a staking feature to its ETH ETF. Several other providers have submitted applications with similar options. According to Bloomberg, the deadline for reviewing early applications is the end of October.

Mining company BitMine Immersion Technologies has become the largest public holder of Ethereum with a balance of 300,657 ETH worth over $1 billion. The accumulation of Ethereum began at the end of June. BitMine stated its goal is to acquire and stake 5% of the total ETH supply.

Gold price rose on Monday and moved to the upper part of near-term range ($3320/$3377) after another attack at the top of rising daily cloud was rejected last Thursday.

Rising daily cloud continues to underpin the action since January and proved to be very strong support after it contained several attack of consolidative /corrective phase under new record high ($3500).

Weaker dollar was mainly behind today’s advance, though safe-haven demand remains fueled by growing uncertainty over US tariffs, as President Trump’s Aug 1 deadline approaches and a number of countries (including EU, Japan) haven’t reached an agreement that keeps alive threats of 30% taxes to be imposed on all imports from these two countries.

On the other hand, traders also keep an eye on comments from Fed officials as the FOMC meets next week, to get more hints about the central bank’s next steps.

The Fed policymakers announced earlier that they will keep interest rates on hold as inflation unexpectedly rose in June and is likely to be boosted further by the consequences of new US import tariffs that is directly confronting Trump’s demands to reduce US interest rates to 1%, to attract investments and boost economic growth.

Fresh advance cracked the upper borderline of smaller triangle on daily chart ($3365) which guards next significant barriers at $3373/77 (Fibo 76.4% of $3452/$3246 / July 16 spike high – recent range tops) violation of which to generate bullish signal and expose targets at $3400/03 (psychological / Fibo 76.4%).

Conversely, repeated failure at tringle upper trendline would keep the price in extended but narrowing range.

Res: 3373; 3377; 3388; 3400.
Sup: 3350; 3330; 3320; 3315.

The earnings season is gaining momentum. This week, major technology companies such as Alphabet (GOOGL) and Tesla (TSLA) are scheduled to release their quarterly results.

Given that 85% of the 53 S&P 500 companies that have already reported have exceeded analysts’ expectations, it is reasonable to assume that market participants are also anticipating strong results from the big tech names. The Nasdaq 100 index (US Tech 100 mini on FXOpen) set an all-time high last week — a level that may be surpassed (potentially more than once) before the end of August.

Technical Analysis of the Nasdaq 100 Chart (US Tech 100 mini on FXOpen)

Price movements have formed an upward channel (marked in blue), with the following dynamics observed:

→ The bearish signals we highlighted on 7 July did not result in any significant correction. This may be interpreted as a sign of a strong market, as bearish momentum failed to materialise despite favourable technical conditions.

→ Buyers have shown initiative by gaining control at higher price levels (as indicated by the arrows): the resistance at 22,900 has been invalidated, while the 23,050 level has flipped to become support.

→ A long lower shadow near the bottom boundary of the channel (circled on the chart) underscores aggressive buying activity.

Should the earnings and forward guidance from major tech firms also come in strong, this could further reinforce the sustainable bullish trend in the US equity market.

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