Alberto Musalem, St. Louis Fed president, speaks soon. He has recently turned more hawkish, now favouring earlier, gradual rate hikes over "later, larger, abrupt" moves, citing eroding inflation credibility after the Treasury selloff.
Source: Finnhub
The US dollar faces a pivotal test ahead of Friday's July Non-Farm Payrolls report, with consensus estimates pointing to a modest 80K jobs added, following June's underwhelming 57K print. Private payroll expectations sit at 78K, while the unemployment rate is projected to hold steady at 4.2%. Leading indicators paint a concerning picture for the labor market: the ADP employment report significantly missed expectations at 44K versus 65K forecast, and the ISM Services employment index contracted sharply to 47.4 from 51.2 prior. However, the ISM Manufacturing employment component provided a bright spot, rising to 52.8. Average hourly earnings are expected to remain stable at 3.5% year-over-year and 0.3% month-over-month, suggesting wage pressures are contained. Average weekly hours are forecast unchanged at 34.3. A weaker-than-expected NFP print could reinforce expectations for Federal Reserve rate cuts, weighing heavily on the greenback. Traders should watch the unemployment rate closely, as any uptick above 4.2% could trigger significant USD selling across major pairs.
EURUSD
GBPUSD
USDJPY
USDCHF
AUDUSD
USDCAD
NZDUSD
Sentiment:
Negative
Source: Finnhub
USD/JPY is attempting a decisive breakout above the critical 200-day moving average at 158.02, a level that has served as significant resistance throughout the week. On Tuesday, the pair rallied toward this key technical barrier but was met with strong selling pressure, triggering a retreat to the swing support zone between 157.21 and 157.30. This support area proved its significance as buyers defended it on three separate occasions — once on Tuesday and twice on Wednesday — establishing a firm floor for the pair. The repeated tests and holds at support, combined with the renewed push toward the 200-day MA, suggest building bullish momentum. Traders should monitor whether the pair can achieve a sustained close above 158.02, as this would likely open the door for further upside. Conversely, a failure to hold above this moving average could trigger another pullback toward the 157.21–157.30 support zone. The battle between these two well-defined technical levels presents clear risk-reward setups for short-term traders.
USDJPY
Sentiment:
Positive
Source: Finnhub
The US Dollar's cyclical strength patterns are under the spotlight as JustMarkets releases a comprehensive research report examining USD fluctuations and their cross-asset implications. The analysis focuses on how recurring USD strength and weakness cycles influence major forex pairs including EUR/USD, GBP/USD, and USD/JPY, as well as broader CFD asset classes such as commodities and indices. The report highlights intermarket correlations, noting that periods of sustained dollar strength typically pressure commodity-linked currencies like AUD and CAD while supporting USD-denominated safe-haven flows. While no specific price levels or economic data points were cited in the announcement, the research underscores the importance of understanding Federal Reserve monetary policy cycles, US Treasury yield dynamics, and global risk sentiment as primary drivers of USD directionality. Traders are encouraged to monitor the DXY (US Dollar Index) for macro trend confirmation. The report serves as an educational resource for identifying parallel trading opportunities across correlated instruments during defined phases of the dollar cycle.
EURUSD
GBPUSD
USDJPY
AUDUSD
USDCAD
Sentiment:
Neutral
Source: Marketaux
Asian-Pacific markets are under pressure as Japanese and South Korean equities tumble, driven by fears over AI-related spending sustainability hitting the Nikkei and KOSPI indices. The selloff carries direct implications for USD/JPY and USD/KRW as risk-off sentiment weighs on regional currencies. Australia's June trade surplus narrowed to AU$1.929 billion, a factor pressuring AUD/USD as the data suggests softening export demand. The PBOC set the USD/CNY reference rate at 6.7895, maintaining a steady hand on yuan management. On the monetary policy front, Fed Governor Daly supported the decision to hold rates steady at the July FOMC meeting, noting that the tariff impact on inflation is beginning to fade, a mildly dovish signal for USD. Reports that Trump holds frequent informal calls with Fed Chair Warsh add a layer of political uncertainty. In Japan, an LDP lawmaker's proposal for the BOJ to sell its ETF holdings to fund tax cuts could have significant implications for JPY if pursued. Fitch assessed Korea's equity volatility as posing limited near-term credit risk, offering some reassurance to KRW holders. Traders should monitor risk sentiment and central bank developments closely.
USDJPY
AUDUSD
USDCNY
USDKRW
Sentiment:
Negative
Source: Finnhub
