Sample Category Title

Daily Pivots: (S1) 1.1759; (P) 1.1775; (R1) 1.1796; More...

No change in EUR/USD's outlook as consolidation continues below 1.1829. Intraday bias stays neutral for the moment. Downside should be contained by 1.1630 resistance turned support to bring rebound. Firm break of 1.1829 will resume the rise from 1.0176 and target 61.8% projection of 1.0176 to 1.1572 from 1.1064 at 1.1927.

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 now remain the favored case as long as 1.1604 support holds.

Daily Pivots: (S1) 1.3626; (P) 1.3654; (R1) 1.3672; More...

No change in GBP/USD's outlook as consolidations continue below 1.3787. Intraday bias stays neutral at this point. Deeper pullback cannot be ruled out, but downside should be contained by 1.3369 support to bring rebound. Firm break of 1.3787 will resume larger up trend to 100% projection of 1.2099 to 1.3206 from 1.3138 at 1.3813.

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 1.2985) holds, even in case of deep pullback.

Daily Pivots: (S1) 0.7920; (P) 0.7940; (R1) 0.7958; More….

USD/CHF's consolidation from 0.7871 is still in progress and intraday bias remains neutral. Stronger recovery cannot be ruled out, but upside should be limited by 0.8054 support turned resistance to bring another fall. Below 0.7871 will extend the larger down trend to 61.8% projection of 0.9200 to 0.8038 from 0.8475 at 0.7757. Firm break there will pave the way to 100% projection at 0.7313 next.

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) 144.11; (P) 144.56; (R1) 144.92; More...

USD/JPY's rebound from 142.66 extended higher today, but it's still bounded inside range of 142.66/148.01. Intraday bias remains neutral. On the upside, firm break of 148.01 resistance will resume the rise from 139.87 to 61.8% retracement of 158.86 to 139.87 at 151.22. However, break of 142.66 will bring deeper fall back to retest 139.87 low.

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.

Daily Pivots: (S1) 1.3575; (P) 1.3596; (R1) 1.3625; More...

USD/CAD's breach of 1.3666 resistance suggests that fall from 1.3797 has completed at 1.3555. Corrective pattern from 1.3538 is in the third leg. Intraday bias is back on the upside for 1.3797 resistance and possibly above. On the downside, firm break of 1.3538/55 support zone will confirm resumption of whole decline from 1.4791.

In the bigger picture, price actions from 1.4791 medium term top could either be a correction to rise from 1.2005 (2021 low), or trend reversal. In either case, further decline is expected as long as 1.4014 resistance holds. Next target is 61.8% retracement of 1.2005 (2021 low) to 1.4791 at 1.3069.

Dollar is outperforming across the board as markets enter into US session, which trade war risks continue to dominate market attention. With the July 9 tariff truce deadline fast approaching, The Trump administration shifted to a confrontational stance, offering “take-it-or-leave-it” tariff deals. According to Treasury Secretary Bessent, failure to reach agreements would result in tariffs snapping back to April 2 levels, some of which are steep enough to disrupt bilateral trade flows.

Of particular concern is Trump’s new threat to slap a 10% tariff on any nation aligning itself with the “anti-American policies of BRICS.” While the US stopped short of naming targets, the implication is clear: countries like Australia and New Zealand, which maintain extensive trade ties with China and India, are now in the crosshairs. That warning rattled regional FX markets, sending AUD and NZD lower against Dollar.

Diplomatic activity is intensifying. European Commission President Ursula von der Leyen reportedly had a “good exchange” with US President Donald Trump over the weekend, and a Commission spokesperson confirmed the EU remains committed to reaching a trade deal before the deadline. Japan has taken a more guarded approach, confirming that its negotiator held “in-depth exchanges” with US Commerce Secretary Lutnick. Tokyo reiterated its desire to reach a deal while protecting national interests. Meanwhile, Thailand submitted a new proposal offering to cut tariffs on many US goods to zero in a bid to avoid retaliatory measures, highlighting the growing pressure smaller economies face to align with US demands.

In FX markets, Dollar is leading gains, followed by Sterling and Loonie, while Kiwi, Aussie, and Yen are underperforming. Euro and Swiss franc are trading near the middle of the pack.

Focus now shifts to RBA in the upcoming Asian session, with a rate cut to 3.60% fully priced in. What matters more is whether Governor Michele Bullock signals an accelerated easing path, as inflation cools and domestic demand weakens. Given the current risk environment, any dovish tilt would likely amplify AUD’s downside pressure.

Technically, AUD/JPY's choppy rise from 91.64 is seen as the second leg of the corrective pattern from 95.63, and should be close to completion. Firm break of 93.95 support will argue that the third leg has started, and target near term channel support (now at 93.12), ad then 91.64 support.

In Europe, at the time of writing, FTSE is up 0.11%. DAX is up 0.79%. CAC is up 0.27%. UK 10-year yield is down -0.005 at 4.557. Germany 10-year yield is up 0.021 at 2.628. Earlier in Asia, Nikkei fell -0.56%. Hong Kong HSI fell -0.12%. China Shanghai SSE rose 0.02%. Singapore Strait Times rose 0.45%. Japan 10-year JGB yield rose 0.003 to 1.438.

Eurozone retail sales fall -0.7% mom in May, EU down -0.8% mom

Eurozone retail sales volumes declined by -0.7% mom in May, slightly better than expectations for a -0.8% mom fall but still signaling weak consumer activity across the bloc. The decline was broad-based, with food, drinks and tobacco sales down -0.7% mom, non-food products (excluding fuel) off by -0.6% mom, and automotive fuel volumes sliding -1.3% mom.

Across the broader EU, retail volumes fell by 0.8% mom. National data showed particularly sharp declines in Sweden (-4.6%), Belgium (-2.5%), and Estonia (-2.2%), while Portugal, Bulgaria, and Cyprus bucked the trend with modest gains.

Eurozone Sentix rises to 4.5, recovery gaining momentum, ECB may pause cuts

Eurozone’s Sentix Investor Confidence Index rose from 0.2 to 4.5 in July, its highest since February 2022. The improvement was broad-based: Current Situation Index climbed from -13.0 to -7.3, and Expectations strengthened from 14.3 to 17.0. This marks the third consecutive gain across all components—fulfilling what Sentix calls the “triple rule” for identifying an economic turning point.

“The July data indicate a sustained upturn,” Sentix noted, adding that the recovery is now gaining in breadth. This aligns with recent data showing stabilization in business activity and firming consumer sentiment, suggesting that the bloc may be entering a more durable phase of expansion after years of stagnation.

Meanwhile, the improving sentiment is likely to narrow ECB’s scope for further rate cuts. Sentix’s policy barometer, released alongside the economic index, suggests that monetary policy will remain in a "comfort zone" rather than pivot toward aggressive easing.

Japan real wages post sharpest drop Since 2023 as bonuses shrink

Japan’s real wages fell -2.9% yoy in May, a sharp acceleration from April’s -2.0% drop yoy and the steepest decline since September 2023. This also marks the fifth consecutive monthly fall in inflation-adjusted income, as households remain squeezed by rising prices and underwhelming nominal pay growth. Consumer inflation, used to deflate nominal wages, stood at 4.0% yoy, driven by higher food costs, particularly rice.

Nominal wages rose just 1.0% yoy, well short of the 2.4% yoy forecast and down from 2.0% yoy in April. While base salary growth held at 2.0% yoy and overtime pay rose 1.0% yoy, a sharp -18.7% yoy plunge in special payments—largely one-off bonuses—dragged down the overall figure. May marked the 41st consecutive monthly rise in nominal wages, but the pace failed again to keep up with price growth.

Government officials cautioned that the wage data may not yet reflect the full impact of spring labor negotiations, especially as many small firms surveyed lack unions and implement pay increases more slowly than large corporations. Nonetheless, the prolonged real wage squeeze could weigh on consumer spending and affect BoJ’s plans to gradually normalize policy.

USD/CAD Mid-Day Outlook

Daily Pivots: (S1) 1.3575; (P) 1.3596; (R1) 1.3625; More...

USD/CAD's breach of 1.3666 resistance suggests that fall from 1.3797 has completed at 1.3555. Corrective pattern from 1.3538 is in the third leg. Intraday bias is back on the upside for 1.3797 resistance and possibly above. On the downside, firm break of 1.3538/55 support zone will confirm resumption of whole decline from 1.4791.

In the bigger picture, price actions from 1.4791 medium term top could either be a correction to rise from 1.2005 (2021 low), or trend reversal. In either case, further decline is expected as long as 1.4014 resistance holds. Next target is 61.8% retracement of 1.2005 (2021 low) to 1.4791 at 1.3069.

The USDJPY pair jumps around 0.7% on Monday morning, as fresh risk aversion fuels demand for safe-haven dollar.

Monday’s acceleration penetrated daily cloud (spanned between 144.74 and 145.54) with cloud top being under increased pressure, after bulls broke through double-Fibo barriers at 145.35/38 (50% of 148.64/142.11/50% of 148.02/142.68).

Break and close above cloud top to generate fresh bullish signal and shift near term bias higher, with targets at 145.96 (100DMA) and 146.15 (Fibo 61.8%) to come in focus.

Meanwhile, bulls may face headwinds at cloud top and take a breather as overbought daily stochastic warns.

Dips should be limited and hold above cloud base (144.74) to keep fresh bulls in play.

Res: 145.54; 145.96; 146.15; 146.30.
Sup: 145.20; 144.97; 144.74; 144.31.

The USD/JPY pair edged higher on Monday, reaching 144.81, as the yen relinquished its earlier gains. The currency faced downward pressure following the release of disappointing wage figures, which dampened expectations for further monetary policy tightening by the Bank of Japan.

Japan’s nominal wages rose by just 1.0% year-on-year in May, falling well short of the 2.4% forecast and marking a third consecutive monthly slowdown. Meanwhile, real wages, which reflect actual purchasing power, declined by 2.9% – the sharpest drop in nearly two years and the fifth straight month of contraction.

Notably, the official data does not yet fully account for the impact of this spring’s record wage agreements, negotiated with trade unions. Several smaller and non-unionised firms have been slower to implement these changes, delaying their effect on broader wage trends.

Further weighing on the yen were remarks from Prime Minister Shigeru Ishiba, who stated on Sunday that Japan would not make “easy concessions” in trade talks with the US, despite the threat of 35% tariffs on Japanese exports. Negotiations are expected to resume this week.

Technical Analysis: USD/JPY

H4 Chart:

On the H4 chart, USD/JPY has formed a consolidation range around 144.33 before pushing upward. The immediate target is 145.33, after which we anticipate a downward correction towards 142.45, with potential for further declines to 141.70. This scenario is supported by the MACD indicator, where the signal line remains above zero and points firmly upward.

H1 Chart:

On the H1 chart, the pair corrected to 144.11 before resuming its upward trajectory, targeting 146.26. Upon reaching this level, we expect a new decline towards 143.90. A break below this level could extend losses to 141.70. The Stochastic oscillator aligns with this view, with its signal line currently at 80 and turning downward.

Conclusion

The yen’s weakness reflects subdued wage growth and lingering trade uncertainties, while technical indicators suggest potential volatility ahead.

Eurozone retail sales volumes declined by -0.7% mom in May, slightly better than expectations for a -0.8% mom fall but still signaling weak consumer activity across the bloc. The decline was broad-based, with food, drinks and tobacco sales down -0.7% mom, non-food products (excluding fuel) off by -0.6% mom, and automotive fuel volumes sliding -1.3% mom.

Across the broader EU, retail volumes fell by 0.8% mom. National data showed particularly sharp declines in Sweden (-4.6%), Belgium (-2.5%), and Estonia (-2.2%), while Portugal, Bulgaria, and Cyprus bucked the trend with modest gains.

Full Eurozone retail sales release here.

Market participants were expecting an upbeat start to the week on the hope that trade deals might finally be announced as the Trump administration deadline of July 9 approaches. However, President Trump adopted a confrontational stance once more by announcing that the US will begin issuing tariff letters to countries as early as Monday.

There has been some mixed comments from the Trump administration though, with Commerce Secretary Lutnick saying tariffs are to take effect from August 1. Is this another case where the Trump administration will delay the implementation of tariffs or just miscommunication? I expect we will hear more as the day progresses.

Asian Market Wrap

Asian stocks, as measured by MSCI’s index, dropped 0.6%. U.S. Treasury prices went up, causing the 10-year yield to fall slightly to 4.33%. The Dollar index increased by 0.1%, while the Chinese Yuan weakened after Trump announced a 10% extra charge for people linked to the BRICS nations. He also said the U.S. will send out tariff notices and announce trade deals starting Monday at 12 PM ET.

Trade tensions are rising again as investors watch how negotiations between the U.S. and other countries progress before the July 9th deadline. Stocks have hit record highs, bouncing back from their April drop caused by earlier tariff announcements. This rebound is driven by hopes that the tariff deadline might be extended, as Trump often makes threats but later softens his stance.

Officials have previously said higher tariffs are set to start on August 1, but some countries might get extra time to negotiate. Treasury Secretary Bessent mentioned that a three-week delay could be offered to certain nations for further discussions.

OPEC + to Increase Production

OPEC+ agreed at a weekend meeting to raise production by 548,000 barrels per day (bpd) in August, up from the 411,000 bpd the group had approved for May, June and July, and 138,000 bpd for April.

The production boost will come from eight members of the group - Saudi Arabia, Russia, the United Arab Emirates, Kuwait, Oman, Iraq, Kazakhstan and Algeria.

Source: HSBC Global Research, LSEG Workspace

OPEC+ said the decision was based on a "steady global economic outlook" and "healthy market conditions," continuing their message that the oil market is doing well.

Markets opened last night with Oil prices down around $1 from its Friday close before an Asian session recovery. It will be interesting to gauge how markets react in the European and US sessions to the OPEC + decision.

Until such a time that more information on trade deals is signed officially the rally in Oil prices may face hurdles and concerns which is likely to cap further gains.

European Open

European stock markets showed mixed results on Monday as investors kept an eye on news about U.S. President Donald Trump's upcoming tariff deadline.

The overall European STOXX 600 index stayed steady at 541.08 points.

Other major markets were mixed too: Germany's DAX rose 0.4%, France's CAC 40 fell 0.1%, Spain's IBEX went up 0.1%, and the UK's FTSE 100 dropped 0.2%.

On the FX front, The U.S. dollar index, which compares the dollar to six other major currencies, rose 0.2% to 97.145. This is slightly above last Tuesday's low of 96.373, which was the weakest level in nearly 3.5 years.

The dollar dropped slightly to 0.7949 Swiss francs, while the euro fell 0.2% to 1.1767 but stayed near its July 1 high of $1.1829, the strongest since September 2021.

The U.S. dollar also gained 0.3% against both the Canadian dollar and the Mexican peso, reaching 1.3640 and 18.6548 pesos, respectively.

Currency Power Balance

Source: OANDA Labs

Economic Data Releases and Final Thoughts

Looking at the economic calendar, which is a bit quieter this week for both the US and EU this week.

There is Euro Area retail sales due out in a short while and German CPI on Thursday.

The main focus this week will be on trade deal developments as the tariff deadline looms large. Clarity will also be sought on the different dates being discussed with the August 1 date being mentioned more regularly in the last few days.

US officials may want to announce some deals on July 9 which will come into effect on August 1 and this would in turn give other countries time to strike a deal.

It will be intriguing to see how this develops over the course of the day and week as this could be the major driving force behind volatility this week.

For all market-moving economic releases and events, see the MarketPulse Economic Calendar. (click to enlarge)

Chart of the Day - DAX Index

From a technical standpoint, European stocks have been in a Limbo the last few weeks while US stocks have continued their ascent.

Much of this ha been down to the ongoing tit-for-tat between the EU and US regarding a potential trade deals.

As the deadline approaches will the news provide a short in the arm for the DAX Index.

The DAX is hovering just shy of the 24000 handle on a key confluence area which is providing support.

The price range between 23700 and 23650 hosts both the 20 and 50-day MAs and could be a key support zone if bears wish to push prices even lower.

If this level holds bulls may fancy their chances of a bigger move to the upside.

DAX Daily Chart, July 17. 2025

Source: TradingView.com (click to enlarge)

Support

• 23700
• 23471
• 23212

Resistance

• 24000
• 24144
• 24340