Fundamental
Overview

The USD continues to be
backed by good economic data as we have also seen recently from the US PMIs last Friday and the US Consumer Confidence report this week. Yesterday, we
also got the US Jobless Claims figures where the data showed that
the labour market continues to rebalance via less job availability rather than
more layoffs.

Such data keeps the
interest rates expectations stable around two cuts by the end of the year and
supports the risk sentiment amid a pickup in growth without inflationary
pressures.

The GBP, on the other hand,
has been under pressure since the BoE policy decision where the central bank delivered
some dovish signals and kept the door open for a rate
cut in August. This week the Pound has been under pressure mainly due to some
US Dollar strength.

It looks like the price
action this week has been influenced more by month-end, quarter-end and mid year-end
flows rather than something fundamental.

GBPUSD
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that GBPUSD bounced once again from the support at 1.2635 today as the buyers continue to step
in around this level to position for a rally into new highs with a better risk
to reward setup. The sellers, on the other hand, will want to see the price
breaking lower to gain more conviction and increase the bearish bets into the
1.25 handle next.

GBPUSD Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see that the downside momentum seems to be slowing as the lower lows get
shallower. This might be a signal for a reversal, although a break to the
downside could invalidate it.

The buyers will want to see
the price breaking above the downward trendline to gain more conviction and
increase the bullish bets into the 1.28 handle. The sellers, on the other hand,
might lean on the trendline to position for a break below the support with a
better risk to reward setup.

GBPUSD Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can
see that we’ve been ranging for the entier week as flows have been dominating the price action and the market awaits
new catalysts to push it in either direction. There’s not much else to do here other than waiting for the price to reach the key levels or provide some breakouts. The red lines define the average daily range for today.

Upcoming
Catalysts

Today we conclude the week with the US PCE report where the market expects
the Core PCE to fall further towards the Fed’s 2% target.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

• We are gaining more confidence in the forecast
• And there is more scope to disregard the smaller bumps in the disinflation process
• Being „data-driven“ currently does not mean being „flash-driven“
• Data is inherently noisy and there is a risk of overreacting to volatile news
• Should refrain from changing 2% inflation target

He’s taking heart in the better headline reading in the French inflation data earlier here. But again, it isn’t going to be one to compel them to move in July. The next key date to watch will be September and there are still quite a number of data releases to work through until then.

This article was written by Justin Low at www.forexlive.com.

Climbing to the top ranks of the world’s largest
corporations is no small feat. However, the efforts invested often yield
immense returns. The company we’re discussing experienced a decade of financial
losses after its founding, finally turning a profit in 2003. Prior to that, the
dot-com bubble had plummeted its stock from $113 to $5.50 per share. Yet, these
challenges didn’t prevent Amazon from reaching a $2 trillion market cap just
six years after achieving its first trillion-dollar milestone.

Relentless enthusiasm for AI and potential
interest rate cuts this year are driving demand for
technology-related stocks. This optimism, combined with economic resilience,
propelled Amazon stock past the monumental $2 trillion milestone for the first
time in its history.

Amazon shares surged by
3.9% in a single day, enabling the e-commerce giant to cross
the threshold of the exclusive club. Amazon is now the fifth company to hit
this lofty benchmark, alongside Apple, Microsoft, Nvidia, and Alphabet.
Notably, Microsoft, Apple, and Nvidia are the only three companies that have
crossed the $3 trillion mark so far.

Last week, Nvidia briefly became the most
valuable company on Wall Street by hitting $3 trillion,
thanks to its chips that power numerous AI applications. As global interest in
AI has grown, Amazon has also made significant investments in the technology.
Shares of the mega-cap technology company have got a lift of nearly 30% over
the year as the company cut costs and restructured its business to capitalize
on the AI frenzy.

Amazon Web Services (AWS), the world’s largest cloud
services provider, has seen growth rebound after a dip last year, driven by the
increasing adoption of AI technologies. Additionally, Amazon has invested in AI
startup Anthropic and robotics firm Figure to leverage the AI boom
further. Late last year, Amazon introduced a new generation of custom-designed
chips for data centers aimed at machine-learning training and generative AI
applications.

From its humble beginnings in a basement, Amazon has grown
into a formidable force in e-commerce and cloud computing. In 2023, Amazon
reported $575 billion in revenue, ranking second only to Walmart’s staggering
$639 billion.

All of the aforesaid begs the question: How much would you
have now if you had invested $1,000 in Amazon in 1999 instead of being two
years old?

This article was written by FL Contributors at www.forexlive.com.

The report notes that the survey is expected to be used as a basis for discussions when the BOJ is to meet with bond market participants on 9-10 July. The sources add that the survey is asking market players about their expectations on the range and pace of the tapering process.

As they look to take this next step, it’s just prudent to get some idea of what the market is expecting. There’s nothing peculiar about this and it will just help smoothen the discussions in two weeks‘ time.

This article was written by Justin Low at www.forexlive.com.

• We don’t do that (setting policy based on one data point)
• Inflation has picked up a little bit
• But it could just be that monetary policy is taking longer to feed through to the services sector
• The right policy response to that, clearly, would be to hold your nerve
• We’re coming down in a slightly bumpy way, but we are coming down (on inflation)

His is saying that the RBA should not produce a kneejerk reaction to the latest inflation data. That means they will still keep things in view for August. But if we get more stubborn price numbers especially in the Q2 CPI report on 31 July, that might change up the picture again.

This article was written by Justin Low at www.forexlive.com.

Fundamental
Overview

The USD continues to be
backed by good economic data as we have also seen recently from the US PMIs last Friday and the US Consumer Confidence report this week. Although such
data keeps the interest rates expectations stable around two cuts by the end of
the year, it should also support the risk sentiment amid a pickup in growth.
This could be a headwind for the greenback.

This week the US Dollar has
been in the driving seat, although it looks like the price action is being
influenced more by month-end, quarter-end and half year-end flows rather than
something fundamental. We had also a key breakout in USDJPY yesterday and flows
there might have spilled over to other major pairs.

We got also the Canadian CPI figures this week which surprised
to the upside and trimmed rate cuts expectations for July with the market now
pricing a 65% chance of no change. That was not enough to break out of the
strong support zone around the 1.36 handle as it didn’t change much the bigger picture,
but it might keep the Loonie supported going forward once the quarter-end flows
fade out.

USDCAD
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that USDCAD bounced on the key support zone around the 1.36 handle. That’s where the
buyers continue to step in with a defined risk below the support to position
for a rally back into the 1.3785 resistance. The sellers will want to see the
price breaking lower to pile in more aggressively and target a drop into the
1.34 handle next.

USDCAD Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see that the price yesterday broke above the 1.3680 resistance and pulled back
to retest it today. We can also see that we have the 38.2% Fibonacci
retracement level for confluence
there.

This is where the buyers
will likely step in with a defined risk below the level to target an extension
of the rally towards the 1.3785 resistance. The sellers, on the other hand,
will want to see the price falling back below the level to regain some control
and position for a break below the 1.36 support with a better risk to reward
setup.

USDCAD Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can
see that we had also a downward trendline adding some extra confluence to the
1.3680 resistance. This breakout might give the buyers more conviction for a
rally back into the 1.3785 resistance next. The red lines define the average daily range for today.

Upcoming
Catalysts

Today we get the latest US Jobless Claims figures, while tomorrow we conclude
the week with the Canadian GDP and the US PCE report.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

Fundamental
Overview

The USD continues to be
backed by good economic data as we have also seen recently from the US PMIs last Friday and the US Consumer Confidence report this week. Although such
data keeps the interest rates expectations stable around two cuts by the end of
the year, it should also support the risk sentiment amid a pickup in growth.
This could be a headwind for the greenback.

The GBP, on the other hand,
has been under pressure since the BoE policy decision where the central bank dropped some
dovish signals and kept the door open for a rate
cut in August. This week the Pound has been under pressure mainly due to some
US Dollar strength.

It looks like the price
action is being influenced more by month-end, quarter-end and half year-end
flows though rather than something fundamental. We had also a key breakout in
USDJPY yesterday and flows there might have spilled over to other major pairs.

GBPUSD
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that GBPUSD is testing once again the support
at 1.2635 as the buyers continue to step in around this level to position for a
rally into new highs with a better risk to reward setup. The sellers, on the
other hand, will want to see the price breaking lower to gain more conviction
and increase the bearish bets into the 1.25 handle next.

GBPUSD Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see that the downside momentum seems to be slowing as the lower lows get
shallower. This might be a signal for a reversal although a break to the
downside could invalidate it.

The buyers will want to see
the price breaking above the downward trendline
to gain more conviction and increase the bullish bets into the 1.28 handle. The
sellers, on the other hand, might lean on the trendline to position for a break
below the support with a better risk to reward setup.

GBPUSD Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can
see that we have the upper limit of the average daily range for today standing right around the
trendline. It’s unlikely that we will see a break to the upside today, but it
will be something to watch in the next days as quarter-end flows fade out.

Upcoming
Catalysts

Today we get the latest US Jobless Claims figures, while tomorrow we conclude
the week with the US PCE report.

See the video below

This article was written by Giuseppe Dellamotta at www.forexlive.com.

Headlines:

• USD/JPY slowly testing the waters above the 160.00 mark
• USDJPY Technical Analysis – The market is testing the intervention level again
• Is a rate hike back on the menu for the RBA?
• Equities see early gains fade as the push and pull continues
• ECB’s Panetta says should avoid even „casual forward guidance“ on timing of rate moves
• ECB’s Rehn: I always knew inflation path would be a bumpy road
• Germany July GfK consumer sentiment -21.8 vs -18.9 expected
• France June consumer confidence 89 vs 89 expected
• UK June CBI retailing reported sales -24 vs 8 prior
• Switzerland June UBS investor sentiment 17.5 vs 18.2 prior
• US MBA mortgage applications w.e. 21 June +0.8% vs +0.9% prior

Markets:

• AUD leads, NZD lags on the day
• European equities lower; S&P 500 futures down 0.1%
• US 10-year yields up 4.9 bps to 4.286%
• Gold down 0.3% to $2,310.84
• WTI crude up 0.7% to $81.38
• Bitcoin down 0.9% to $61,329

There were some decent moves in European morning trade today, with the dollar holding firmer across the board helped out by higher bond yields. That saw USD/JPY move up to clip the 160.00 mark once again and is now testing waters above that on the day. The high for the day is at 160.40, matching up to the 1990 high.

I wouldn’t underestimate the upside potential of the pair considering that it is clear skies in terms of the technicals. But it’s all a psychological game now and if buyers push it too far, too fast, Tokyo will be ready to step in again.

With equities also surrendering early gains and yields nudging higher, that is keeping the dollar underpinned on the day.

EUR/USD is down 0.3% from 1.0710 to 1.0680 while GBP/USD eased from 0.3% from 1.2680 to 1.2645 on the session. Meanwhile, USD/CAD is up 0.2% to 1.3690 and NZD/USD down 0.4% to 0.6095 on the day.

The aussie is the one leading gains though after hotter inflation numbers earlier. But AUD/USD has eased from 0.6680 to 0.6650 levels now, though still up 0.2% on the day.

As a reminder, month-end and quarter-end is approaching so that will be a factor for consideration in the sessions ahead as well.

This article was written by Justin Low at www.forexlive.com.

Easy come, easy go. European indices opened higher but have pared gains on the day with the CAC 40 index in particular now marked down by 0.6%. The nerves are still flowing in the equities space and more so for Europe with the French elections coming up. As for US futures, we are also seeing S&P 500 futures erase early gains to be flat now:

It’s tough to get a grip on the risk mood this week. On Monday, European stocks nudged higher while tech shares dragged the S&P 500 lower. Yesterday, it was more of the opposite instead. And so far today, we’re rocking back and forth and reversing the mood from yesterday again.

This article was written by Justin Low at www.forexlive.com.

• Prior +0.9%
• Market index 212.0 vs 210.4 prior
• Purchase index 147.8 v 146.0 prior
• Refinance index 552.4 vs 552.7 prior
• 30-year mortgage rate 6.93% vs 6.94% prior

Mortgage applications were a touch higher in the past week, with a rise in purchase activity helping to offset a marginal decline in refinancing activity. Overall, housing activity remains rather tepid at best – even if there was a significant bump in mortgage applications in the weeks before.

This article was written by Justin Low at www.forexlive.com.