Markets are taking a more measured tone to start the day as President Trump meets with China’s Premier Xi while traveling abroad. At the same time, the Iran-US conflict appears to be temporarily on hold, helping ease some geopolitical anxiety. Crude oil is trading about $0.70 lower on the day, fluctuating above and below the $100 level as traders weigh the pause in tensions against ongoing supply concerns.
US equity futures are modestly higher in premarket trading after both the S&P 500 and NASDAQ closed at fresh all-time record highs yesterday. Dow futures are up around 40 points, the S&P 500 is higher by 25 points, and the NASDAQ is up 69 points. Meanwhile, Treasury yields are moving lower, with the 2-year yield down 3.4 basis points to 3.95%, the 10-year yield down 3.6 basis points to 4.444%, and the 30-year yield lower by 3.3 basis points to 5.011%.
In UK political news, Health Minister Wes Streeting has resigned, fueling speculation that he could enter a potential leadership battle against Prime Minister Starmer and other contenders.
On the economic calendar, US initial jobless claims are expected at 205K versus 200K last week. Retail sales are forecast to rise 0.5% after a 1.7% gain last month, while ex-autos sales are expected up 0.6% versus 1.9% previously. The closely watched control group is projected to rise 0.4% compared to 0.7% last month. In Canada, wholesale sales are expected to increase by 1.4% after a 2.0% rise previously.
The US dollar is little changed overall ahead of the data releases. In the video above, I take a technical look at the three major currency pairs — EURUSD, USDJPY, and GBPUSD. Highlights include:
EURUSD:
The EURUSD continues to trade around its 100-day moving average at 1.1707, currently sitting just below that level near 1.1700. Staying below keeps the sellers more in control, with the next major downside target coming at the confluence of the 200-day moving average and the 38.2% retracement near 1.1680. A break below that area would increase the bearish bias.
USDJPY:
The USDJPY moved higher to test the lower end of a key swing area between 157.975 and 158.26, where willing sellers leaned against the move after the price reached 157.99. The pair then rotated lower toward a strong support cluster between 157.40 and 157.57, which includes the 100-hour moving average, the 100-day moving average, the 38.2% retracement, and prior floor levels. Buyers leaned against that support, helping the pair rebound. The technical levels are well defined, and traders will be looking for a break-and-run move outside the range.
GBPUSD:
The GBPUSD continues to find support between 1.3497 and 1.35129, with the 100-day moving average just below at 1.3481. Yesterday, the pair bounced from that moving average once again, reinforcing its importance as a key downside risk-defining level
