US Dollar Index

The US dollar index rose above 97 to a near one-week high of 97.67 on Monday after President Trump confirmed on Sunday that his tariffs will take effect on August 1. So far, only China, the United Kingdom and Vietnam have reached some form of agreement with Washington. Last week, the dollar fell to its lowest level in more than three years, pressured by rising tariff risks, increasing fiscal concerns and expectations of further interest rate cuts from the Federal Reserve. However, stronger-than-expected US employment data helped to ease these concerns. The 147,000 new jobs in June exceeded the forecast of 110,000 and was slightly higher than the 144,000 in May, alleviating recession fears and reducing immediate pressure on the Federal Reserve to cut interest rates further.

The US dollar index made another attempt to recapture the 97.00 mark at the beginning of the week, but the rebound to the 14-day simple moving average at 97.62 was blocked once the bulls failed to stabilize above 97. A possible retest further reinforces the bearish pattern as the US dollar index continued to move lower during Friday's trading session, trading below the 14-day simple moving average of 97.60 and 98.00, indicating that the upward momentum remains weak. Unless the bulls can achieve a clean breakout around 97.00–97.20, the broader bearish trend may continue. Momentum indicators also reflect a cautious attitude. The 14-day relative strength index (RSI) hovers around 40, still in the bearish zone but showing early signs of stabilization. If the US dollar index falls below 97.00, the immediate support level near it, the lower Bollinger Band, may open up new downside space pointing to 96.38, the low of last week.

Today, you can consider shorting the US dollar index near 97.68, stop loss: 97.80, target: 97.10, 97.00

WTI spot crude oil

WTI crude oil fell to a low of $64.70 at the opening of the market on Monday, and currently rebounded to slightly above $66.90/barrel. WTI crude oil fell by more than 1% on Monday, continuing last week's decline after OPEC+ accelerated its production increase, sparking concerns about oversupply. The organization agreed to increase production by 548,000 barrels/day in August, higher than the previous monthly increase of 411,000 barrels/day, citing global economic stability and low oil inventories. The current crude oil market is at a critical juncture: OPEC+ announced on Saturday that it would increase production by 548,000 barrels/day in August (exceeding the increase of 411,000 barrels/day in March), but the tense situation in the physical oil market offset some of the pressure to increase production; at the same time, external policy disturbances (such as tariff remarks) continue to affect demand expectations. From a trading perspective, short-term volatility is dominated by capital sentiment, while the medium- and long-term direction is determined by the supply and demand pattern and technical breakthroughs.

WTI crude oil traded as low as $64.70 in early Asian trading on Monday. WTI prices fell sharply after the Organization of Petroleum Exporting Countries and its allies (OPEC+) agreed to increase production in August beyond expectations. From a technical perspective, WTI crude oil is trading in a tight consolidation range and is currently hovering around $66.80, just above the key horizontal support area around $64.00. This level was a major resistance during the April-May period and has now turned into a key support. A clear break below this area could open the door for a downward correction, targeting $63.72 {50-day simple moving average}, and the $63.72 level, a low in the past two weeks. On the upside, the $67.00 {round mark} can be considered first, followed by the $67.77 (20-day simple moving average) mark.

Consider going long on WTI crude oil near 66.75 today, stop loss: 66.55, target: 67.80, 68.00

Spot gold

Spot gold last traded around $3,337/oz on Monday, with a low of $3,305. U.S. President Trump's tax cut bill cleared the last hurdle in Congress last Thursday, and the United States began sending letters to countries last Friday to specify the tariff rates that goods imported from these countries to the United States will face, adding uncertainty to the market. No progress was made on the U.S. fiscal situation in the bill, so in the long run, this should be negative for the dollar and positive for gold. The bipartisan Congressional Budget Office estimates that the legislation will add another $3.4 trillion to the $36.2 trillion debt over a decade. The U.S. dollar index fell for the second consecutive week, making gold cheaper for overseas buyers. Demand for physical gold in major Asian markets remained sluggish last week as rising prices suppressed consumer interest, while India's discount narrowed due to reduced imports.

From the daily chart, the price of gold is currently consolidating above the 65-day moving average of $3,303.50 and the $3,300 {market psychological barrier} area, and the overall trend is still bullish. The 14-day relative strength index (RSI) hovers above 50 and enters the positive range, indicating that there is room for further price increases. However, if the price of gold falls to the support level of $3,300-3,303, it is expected to continue to test the support level of $3,272.70. If it breaks through, it will enhance the medium-term downward momentum to the low of $3,245.50 on June 30. The resistance level is currently in the 3,350 {20-day moving average}-3,360 {last week's high} area, which should be used as a key turning point. It is followed by the integer level of 3,400.

Consider going long on gold near 3,333 today, stop loss: 3,330, target: 3,355, 3,360

AUD/USD

The Australian dollar weakened below $0.6500 on Monday, marking the third consecutive session of losses, pressured by market expectations of a rate cut and re-imposition of tariffs by the Reserve Bank of Australia. The market is now pricing in a 99.7% chance that the Reserve Bank of Australia will cut interest rates by 25 basis points on Tuesday, which would be the third rate cut this year. This would bring the official cash rate down to 3.6% in response to reduced inflation risks and a slowing domestic economy. Investors are also turning cautious ahead of the release of the Federal Reserve minutes this week, looking for clues about the central bank's future policy direction. On the trade front, President Trump confirmed that new tariffs will take effect on August 1, with the final rate still under negotiation. Finance Minister Bessant said countries without a trade deal by then face the risk of tariff levels returning to the levels set on April 2. Despite these pressures, analysts expect the Australian dollar to remain stable due to its reliance on the gradually recovering Chinese economy.

AUD/USD fell below 0.6500 to around 0.6480 in Monday trading. Technical analysis of the daily chart shows that the pair currently maintains a sustained bullish bias. The 14-day relative strength index (RSI) of the technical indicator is around 50, indicating that bullish sentiment is dominant. However, AUD/USD has fallen below the nine-day simple moving average of 0.6553, indicating that short-term price momentum is weakening. The pair may test the main resistance of the nine-day simple moving average at 0.6553. A break above this level may improve price momentum and support the pair to approach the eight-month high of 0.6590 set on July 1. Further gains will support the pair to explore the area around the 0.6600 round number mark. On the downside, AUD/USD may hover around 0.6466 {55-day simple moving average}, followed by the 0.6400 round number mark, and the 89-day simple moving average of 0.6398 level.

Consider going long on AUD around 0.6478 today, stop loss: 0.6465, target: 0.6525, 0.6540

GBP/USD

GBP/USD started the new week on a downbeat note at the start of the week and fell below 1.3600 to a recent low of 1.3575, currently holding above 1.3600. Affected by mixed fundamental signals, the pound was supported last week by Prime Minister Keir Starmer's announcement that Chancellor of the Exchequer Rachel Reeves will remain in office for the foreseeable future. However, the increasing likelihood of a rate cut by the Bank of England earlier in August has posed resistance to the GBP/USD pair. However, the downside of GBP/USD remains supported by the bearish sentiment around the US dollar. Investors are concerned that US President Trump's massive tax cut and spending bill will surge the federal deficit and exacerbate the US's long-term debt problems. This has kept the US dollar near its lowest level since February 2021.

On Monday, GBP/USD fell to a near-week low of 1.3575, and is currently trading around 1.3610, close to 1.3600 {market psychological barrier}, and the 20-day simple moving average of 1.3594 continues to serve as the main support area for GBP/USD. The 14-day relative strength index (RSI) of the daily chart technical indicator fell below 55, indicating a weakening of bullish momentum. However, the bullish bias remains. Looking down, initial support is in the 1.3600 - 1.3594 area, followed by the psychological barrier of 1.3500 as a key support area. Looking up, 1.3681 {9-day simple moving average} will become the first resistance level, and a break will point to the three-and-a-half-year high of about 1.3789 as a key resistance level.

Consider going long GBP around 1.3600 today, Stop Loss: 1.3585, Target: 1.3660, 1.3670

USD/JPY

The yen weakened to 146.00 yen per dollar on Monday, reversing the previous session's gains as disappointing wage data dampened expectations for further rate hikes by the Bank of Japan. Nominal wages rose just 1% year-on-year in May, well below market forecasts of 2.4%, marking the third straight month of slowdown. Real wages, a key indicator of consumer purchasing power, fell 2.9%, the biggest drop in nearly two years and the fifth straight month of decline. The broader wage data has yet to reflect the record wage increases agreed during labor negotiations this spring, as many smaller, non-unionized companies have lagged in implementation. The yen also came under additional pressure after Prime Minister Shigeru Ishiba said on Sunday there would be no "easy compromise" in trade talks with Washington, as Japan seeks to avoid U.S. tariffs of up to 35% on its exports.

The US dollar edged slightly higher against the Japanese yen on Monday and is currently hovering around 146.00, forming lower highs and higher lows since April. This suggests a slight optimism ahead of the weekly close, especially as the weekly candle formed a long-legged doji, indicating a continued tug-of-war between bulls and bears.

The symmetrical triangle pattern suggests that while neither the bulls nor the bears have been able to take firm control, the situation remains uncertain as the price approaches the apex of the triangle. Currently, around 146.25{early last week's high} acts as an immediate resistance. A clear break above this area could pave the way for a bullish move towards the 146.58{110-day moving average}–147.00 mark area. On the downside, initial support is located at 145.00{round mark}, and 145.53{10-day moving average}, followed by last Thursday's low near 143.50, which is closely connected to the rising trendline forming the bottom of the triangle.

Consider shorting the dollar near 146.30 today, stop loss: 146.50, target: 145.40, 145.20

EUR/USD

The euro is trading low near $1.17 as investors await clarity on the U.S. government’s upcoming tariff measures. President Trump is expected to send about a dozen formal letters to trading partners later today, although it is unclear whether EU countries will be among the recipients. Meanwhile, Commerce Secretary Howard Lutnick confirmed that the broader tariff measures originally scheduled for July 9 will now be delayed until August 1, providing temporary relief to importers but prolonging uncertainty. On the monetary policy front, the market now expects only one more rate cut from the European Central Bank this year. After eight consecutive rate cuts since June 2024, ECB officials have signaled that rates may remain stable at this month’s meeting.

EUR/USD traded flat last week and formed a “bullish harami” pattern on the daily chart, suggesting that the long-term uptrend remains intact. Currently trading around 1.1700, while the 14-day relative strength index (RSI) is currently at 61.60, showing no signs of upside weakness. Meanwhile, the 20-day simple moving average offers support in the 1.1624 area, well below the current level of 1.1770. However, a clear break above the July 3 high of 1.1809 is needed to test the yearly high of 1.1832. Once these levels are breached, the next targets will be 1.1850 and 1.1900. Conversely, if EUR/USD falls below the 1.1700 mark, it could open up room for a move down to the June 12 high of 1.1631, and the 20-day simple moving average of 1.1624.

Consider going long on EUR around 1.1700 today, stop loss: 1.1685 target: 1.1760, 1.1770

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