S&P 500 and Magnificent Seven dynamics

Investors who have watched indices tread water for weeks are pinning hopes on earnings season. Bloomberg Intelligence records a forecast impulse not seen since 2011: many more companies are raising guidance than cutting it. S&P 500 earnings are expected to rise by 26% in Q2, and Deutsche Bank forecasts as much as 29%. By comparison, the average annual EPS growth over the past two decades is around 7.8%.

These anomalous figures are not solely an AI story. Wall Street argues that a recovery in non-chip, non-data-center sectors, which suffered last year from trade tensions, is also contributing. Bloomberg Intelligence expects every sector of the S&P 500 to report year-over-year earnings growth in Q3, the first such broad-based upswing since 2021.

Earnings revision dynamics

That said, the burden of proof has shifted squarely to the management teams of the large tech names. After weeks of selling in Big Tech, investors now demand returns on invested capital, not just ambitious roadmaps. Future profit signals will be scrutinized: will hundreds of billions ploughed into data-centers yield commensurate returns, or will AI-bubble skeptics be vindicated?

UBS remains constructive on the AI growth narrative but recommends balanced exposure across the value chain, from semiconductor makers to defensive sectors, and stresses diversification beyond AI.

Meanwhile, investors have already pared equity exposure to levels where even modestly positive surprises could spark a fresh buying wave. That compressed demand "spring," combined with strong earnings and a record forecast impulse, provides a foundation for the rally markets have been waiting for.

Will corporate profits be strong enough to offset Middle East war fears and doubts over AI monetization? Time will tell.

Technically, the daily chart shows that the S&P 500 is consolidating in the 7,430–7,580 range. A breakout above the top of this range would be a buy signal, while a fall below its lower boundary would be a reason to sell the broad index.

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Important:

The begginers in forex trading need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp market fluctuations due to increased volatility. If you decide to trade during the news release, then always place stop orders to minimize losses.

Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes. For successful trading, you need to have a clear trading plan and stay focues and disciplined. Spontaneous trading decision based on the current market situation is an inherently losing strategy for a scalper or daytrader.

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The wave structure on the 4-hour chart for the EUR/USD instrument is becoming more complex. There is still no talk of canceling the upward segment of the trend (see lower image), which began in January of last year; however, the wave structure of the trend has now taken on a corrective form. In the long term, we should expect the formation of wave C, with its low needing to be below the low of wave A. Currently, the low of wave C is below the low of wave A, indicating that wave C could complete at any moment. However, with a favorable news backdrop for the dollar, this wave could take on a much more elongated form.

On a smaller scale, I can identify a classic five-wave downward structure. If this assumption is correct, then we are currently in the process of forming wave 4, while wave 3 has taken on a five-wave form. After completing this structure, the instrument may transition to an upward wave sequence. However, according to the current wave analysis, we still expect the formation of wave 5. Therefore, the European currency may dip to the 13 figure.

Geopolitics Are No Longer a Priority

The EUR/USD exchange rate rose by 15 basis points on Wednesday, although the amplitude of the movements remains minimal. The market continues to see no grounds for buying or selling the European currency, which explains the zero activity of its participants. On Thursday morning, the euro added another 20 pips, which leads me to assume that the formation of wave 4 in C is becoming more complex. If that is indeed the case, the price increase will continue with targets around the 15 figure.

In just a few hours, the results of the European Central Bank meeting will be known. There is no intrigue whatsoever. The probability of a second consecutive round of monetary policy tightening is minimal. It is not zero but minimal. The morning rise of the euro may be linked to this event; however, the movements over the last month have been extremely weak, so a 20-pip rise has not made traders feel either cold or hot. Quite frankly, I expect market reaction only if the ECB unexpectedly raises interest rates. I do not expect anything from Christine Lagarde's speech. If the ECB decides to maintain monetary policy parameters, Lagarde is unlikely to promise a rate hike at the next meeting. Most likely, the ECB president will highlight rising inflation and uncertainty related to geopolitics in the Middle East and oil prices. Surprises are possible today but unlikely.

There will be no other events on Thursday. The European currency remains within the framework of a corrective wave, so I still expect further growth of the US dollar to complete the downward wave formation. After that, I expect at least a corrective wave sequence, which may take several weeks. I do not expect the EUR/USD instrument to fall significantly below the 13 figure. Wave 4 may already be complete.

General Conclusions.

Based on my analysis of EUR/USD, I conclude that the instrument remains within an upward trend segment (see lower image), while in a shorter-term perspective, it is within a downward trend segment. In my opinion, it is a good time to consider opening long positions, but the instrument may still dip to the 13-figure level as part of wave 5 in C. Wave analysis often presents surprises, so I would start to readjust toward buying.

On a larger scale, an upward trend segment is visible, after which a corrective wave sequence began. In the near future, we should expect the formation of wave C with targets located around the 1.1352 mark, which corresponds to 38.2% on the Fibonacci scale. After completing the A-B-C structure, a new long-term upward trend may begin.

Key Principles of My Analysis:

1. Wave structures should be simple and understandable. Complex structures are difficult to trade and often require adjustments.
2. If there is no confidence in what is happening in the market, it is better not to enter.
3. There is never and can never be 100% certainty regarding the direction of movement. Don't forget about protective stop-loss orders.
4. Wave analysis can be combined with other forms of analysis and trading strategies.

Meanwhile, Bloomberg reported that the cumulative losses of crypto-related companies from the current Bitcoin downturn amount to tens of billions of dollars. Since October last year, the value of crypto assets held by these companies has dropped from $120 billion to $75 billion. Reports indicate that in 2025, amid Donald Trump's favorable attitude toward Bitcoin, many companies began to adopt the strategy of Michael Saylor's company. The implications of this are well understood by all. The unwavering belief in Bitcoin's eternal rise forces companies to incur losses, abandon projects, and halt expansions. Many are even selling "digital gold," which shows smaller gains with each new four-year cycle. Some companies are abandoning their Bitcoin buying strategy in favor of other investment directions. Even Strategy has begun selling Bitcoin, setting a bad example for other market participants. Thus, we still do not see strong reasons for a rise in the first cryptocurrency.

General Picture of BTC/USD on the Daily (1D) Timeframe

On the daily timeframe, Bitcoin continues to form a downward trend. The trend structure is identified as bearish, and the CHOCH (Change of Character) line is now at $82,800, as a new LL (Lower Low) has been formed. Only above this level can it be considered that the downward trend has ended. Since there are still no signals of an upward trend reversal, we believe the decline will continue. A bearish FVG has been formed in the range of $68,000 - $70,700, which serves as the only POI area for sell positions.

General Picture of BTC/USD on the 4-Hour (4H) Timeframe

On the 4-hour timeframe, Bitcoin is in a downward trend; however, the overall correction is not yet complete. After liquidity for buying was taken out, a price increase began, as we warned. Recently, only small local FVGs have been formed, and reactions to them have typically been very weak. The price reacted to the penultimate bullish FVG, allowing traders to open long positions. However, the last bullish FVG has not yet provided any price reaction. If this pattern is invalidated, it will be the first sign of the end of the upward correction phase. Recall that any rise in Bitcoin now is inherently a correction. Whether or not to capitalize on the correction is up to each trader's decision. We note a liquidity pool below the trend line, which the price is likely to hit with a 90% probability.

Trading Recommendations for BTC/USD:

Bitcoin continues to develop a full-fledged downward trend. We continue to expect a decline targeting $57,500 (the 61.8% Fibonacci level from the three-year upward trend), although this level has essentially already been reached. However, we do not believe that the downward trend will end here. The last bearish FVG was formed in the range of $68,000 - $70,700 on the daily timeframe, so this area serves as the POI for short positions in the coming weeks. On the 4-hour timeframe, Bitcoin continues the second wave of this correction, but sell trades remain more attractive. Short-term long positions are permissible, but it is important to understand that the trend remains downward.

Explanations for Illustrations:

• CHOCH – Break in trend structure.
• Liquidity – Stop Loss, pending orders that market makers use to accumulate their positions.
• FVG – Fair Value Gap. The price moves through these areas very quickly, indicating a complete absence of one side in the market. Subsequently, the price tends to return to such areas and react in continuation of the main trend.
• IFVG – Inverted Fair Value Gap. After returning to such an area, the price does not react but breaks through impulsively and then tests it from the other side.
• OB – Order Block. A candle in which the market maker opens a position to collect liquidity to form their position in the opposite direction.

Nonetheless, the pair has demonstrated an upward dynamic for the fourth consecutive week, despite the escalation of the Middle Eastern conflict, the rise in oil prices, and overall geopolitical tension.

The reason is that the Australian dollar receives substantial support from internal factors. Recent data on inflation and the labor market (which we will discuss in more detail) have significantly reduced the likelihood of easing monetary policy in the foreseeable future. The Reserve Bank of Australia (RBA) is taking a wait-and-see approach and does not rule out the possibility of raising interest rates if inflation begins to accelerate on a sustainable basis. The widening expected interest rate differential between the RBA and the Federal Reserve is working in favor of the Aussie.

Additionally, the commodity market provides extra support to AUD/USD buyers, amid rising prices for key Australian export goods. Iron ore, copper, and several other industrial metals are showing resilience due to sustained demand from China. For instance, iron production (for which iron ore is necessary) in China is operating at the upper limit of seasonal norms. This is traditionally a positive factor for the Australian economy.

The labor market data released today further supported the Aussie, allowing AUD/USD buyers to test the 0.7000 price barrier once again. Despite certain "flaws," the release was strong enough.

In June, the number of employed people in Australia increased by 76,000. This result was nearly three times the forecast, as most analysts expected only a gain of 20,000.

The labor force participation rate rose to 67.0%, one of the highest levels in the history of statistical observation, only slightly below the historical high of 67.1%. However, the unemployment rate remained at 4.4% (this component of the report coincided with experts' expectations).

At first glance, the combination of such a strong increase in employment and stable unemployment might seem contradictory. However, this "anomaly" can be explained by the fact that, alongside the creation of new jobs, the number of people entering the labor market has significantly increased, as many Australians began actively searching for work. As a result, the country's economy managed to "absorb" a significant influx of new workers without reducing the unemployment rate.

In other words, the increase in labor supply nearly fully offset the rise in demand for workers. Such dynamics are characteristic of a stable labor market.

However, the key message from the "Australian Non-Farms" is not the "stagnation" of the unemployment rate, but rather the scale of job creation. Just a few months ago, market participants were expecting a gradual cooling of the labor market amid slowing business activity. However, today's data indicate that the demand for labor remains quite robust.

For the RBA, this dynamic is considered "hawkish." The labor shortage creates upward pressure on wages, which in turn complicates efforts to slow inflation, especially in the service sector, where labor costs account for a significant portion of expenses.

Nevertheless, despite the evidently positive picture, the report contains certain pitfalls. According to representatives of the ABS (Australian Bureau of Statistics), the strong job growth is partially explained by seasonal and calendar factors: some workers who were supposed to start in May actually began their employment only in June. This means that a portion of the June spike is technical in nature, and therefore may not be repeated next month.

Still, AUD/USD traders interpreted today's release unequivocally in favor of the Australian dollar. Although part of the June job gain could have been influenced by statistical factors, the overall signal from the report was strong: the labor market remains resilient, and demand for labor is high. This increases the likelihood that the RBA will not rush to ease monetary policy.

However, the further dynamics of AUD/USD will depend not only on internal data from Australia but also on global risk appetite, the Fed's policies, and the dynamics of the Chinese economy. Given the ongoing geopolitical tensions, the external backdrop may limit the potential for strengthening the Australian currency—even in light of impressive "Australian Non-Farm" numbers.

Currently, AUD/USD buyers are trying to establish themselves above the key resistance level of 0.7000 (the middle line of the Bollinger Bands, which coincides with the Tenkan-sen line on the H4 chart), testing the next price barrier at 0.7020 (the upper line of the Bollinger Bands on the same timeframe). A firm breakout of this zone would open the path for further upward movement toward the target of 0.7070 (the lower boundary of the Kumo cloud on the daily chart).

For opening long positions, it is advisable to wait for confirmation of one of two scenarios. Either AUD/USD buyers will successfully overcome the resistance of 0.7020, after which the path to 0.7070 will open. Or another attempt to storm the 70 level will end in failure, after which the pair will return to the 69 level. In that case, corrective pullbacks could again be seen as an opportunity to open longs with targets of 0.7000 and 0.7020.

No macroeconomic publications are scheduled for Thursday. If we are talking about reports that have at least a theoretical chance of being priced in. Today in the US, a report on jobless claims will be released, which is usually ignored by traders even in normal times, as it is considered secondary. There are no significant reports scheduled today in the Eurozone, Germany, or the US.

Analysis of Fundamental Events:

Among the fundamental events on Thursday, the European Central Bank meeting is notable, but it may also be ignored by the market. It is worth recalling that a month and a half ago, the ECB was the first among major central banks to begin tightening monetary policy amid rising inflation, a fact that the market simply overlooked. Instead, it eagerly priced in the hypothetical rate hike from the Federal Reserve by the end of the year, which might not even happen. Today, the ECB is highly likely (90% probability) to keep rates unchanged, so traders will again have nothing to react to. Christine Lagarde's speech, which rarely offers any promises or hints at future changes in monetary policy, may also not change anything.

The geopolitical backdrop continues to shift in an unfavorable direction. Another ceasefire has been broken, and the US and Iran have resumed hostilities. No negotiations are currently taking place. Donald Trump is preparing for new strikes against Iran, while Tehran is poised to respond by blocking the Bab-el-Mandeb Strait at any moment. The Yemeni Houthis have already announced a blockade of Saudi Arabia, likely anticipating a blockade of the Red Sea. The situation is only intensifying over time, provoking a new rise in oil prices.

General Conclusions:

During the penultimate trading day of the week, the European currency will continue to move within the sideways channel, while the British pound remains within a downward trend. The euro can be traded from the area of 1.1363-1.1377 or from the area of 1.1461-1.1466, while the British pound can be traded from the area of 1.3380-1.3386. Volatility for both currency pairs may remain low.

Basic Rules of the Trading System:

1. The strength of a signal is evaluated based on the time it takes to form (bounce or breakout). The less time required, the stronger the signal.
2. If two or more trades were opened at a particular level based on false signals, all subsequent signals from that level should be ignored.
3. In a flat market, any pair may generate many false signals or none at all. Technical levels may be overlooked.
4. On the hourly timeframe, trading signals from the MACD indicator should be executed only when volatility is good, and a trend is confirmed by a trend line or channel.
5. If two levels are too close together (5 to 20 pips), they should be considered a support or resistance area.
6. After moving 15 pips in the correct direction, a Stop Loss should be set at breakeven.

What's on the Charts:

Price levels (areas) of support and resistance are targets when opening long or short positions or sources of signals.

Red lines indicate channels or trend lines that display the current trend and indicate the preferred direction for trading.

The MACD indicator (14,22,3) – histogram and signal line – is a supplementary indicator that can also be used as a source of signals.

Important speeches and reports (contained in the news calendar) can significantly impact the movement of the currency pair. Therefore, during their release, trading should be conducted with maximum caution, or one should exit the market to avoid sharp reversals against preceding movements.

Beginners trading in the forex market should remember that not every trade can be profitable. Developing a clear strategy and practicing money management are key to long-term success in trading.

1H Chart of the GBP/USD Pair

The GBP/USD pair continued its downward trend on Wednesday, which is taking the form of a full-fledged trend. The ascending trend line has been broken, and a new descending trend line has been established. Thus, the British pound may continue its decline in the near term due to technical factors. Yesterday, the most important report of the week—on inflation for June—was published in the UK. However, on that very day, market movements were virtually absent. The market either priced in the decline in UK inflation in advance or continues to trade by its own rules, which have nothing to do with fundamental and macroeconomic analysis. In any case, the downward trend is relevant; the pound sterling, unlike the euro, is not standing still, so we can still expect good movements. We believe that after the completion of the current downward correction, the British pound will target the area of 1.3700-1.3800, which represents the upper boundary of the sideways channel on the weekly timeframe.

5M Chart of the GBP/USD Pair

On the 5-minute timeframe on Wednesday, two sell signals were generated. The price bounced off the area of 1.3380-1.3386 twice but was unable to move down even 20 pips on either occasion. The overall volatility of the day was an "unreal" 40 pips.

How to Trade on Thursday:

On the hourly timeframe, the GBP/USD pair has begun a new downward trend. After three weeks of growth, a correction was necessary. It is difficult to say how long the British pound will fall, but traders currently have a good reference point in the form of the trend line. Thus, until the price establishes itself above this line, the downward trend remains.

On Thursday, novice traders may open short positions if the price bounces from the area of 1.3380-1.3386, targeting 1.3319-1.3331. A consolidation above the area of 1.3380-1.3386 will allow for the opening of long positions targeting 1.3456-1.3476.

On the 5-minute timeframe, the following levels can currently be traded: 1.3096-1.3107, 1.3175-1.3180, 1.3259-1.3267, 1.3319-1.3331, 1.3380-1.3386, 1.3456-1.3476, 1.3587-1.3598, 1.3631-1.3641, 1.3695. On Thursday, there are no significant events scheduled in the UK or the US, but ironically, it is on this day that the pair may show decent movements. Yesterday's inflation report for the UK was simply ignored by the market. Today, the macroeconomic background will be absent, but the British pound has not been stagnant in recent weeks, unlike the euro.

Basic Rules of the Trading System:

1. The strength of a signal is determined by the time required to form it (a bounce or a breakout). The less time taken, the stronger the signal.
2. If two or more trades were opened at a particular level based on false signals, subsequent signals from that level should be ignored.
3. In a flat market, any pair may form many false signals or none at all. Technical levels may be disregarded.
4. On the hourly timeframe, trading signals from the MACD indicator should be executed only when volatility is good, and a trend is confirmed by a trend line or channel.
5. If two levels are too close together (5 to 20 pips), they should be considered a support or resistance area.
6. After moving 15 pips in the correct direction, a Stop Loss should be set at breakeven.

What's on the Charts:

Price levels (areas) of support and resistance are targets when opening long or short positions or sources of signals.

Red lines indicate channels or trend lines that display the current trend and indicate the preferred direction for trading.

The MACD indicator (14,22,3) – histogram and signal line – is a supplementary indicator that can also be used as a source of signals.

Important speeches and reports (contained in the news calendar) can significantly impact the movement of the currency pair. Therefore, during their release, trading should be conducted with maximum caution, or one should exit the market to avoid sharp reversals against preceding movements.

Beginners trading in the forex market should remember that not every trade can be profitable. Developing a clear strategy and practicing money management are key to long-term success in trading.

1H Chart of the EUR/USD Pair

The EUR/USD currency pair continued its sluggish decline from the upper boundary of the sideways channel to the lower one during Wednesday's trading. There was no macroeconomic background yesterday, so the market had nothing to react to throughout the day. Thus, we continue to observe purely technical movements within the sideways channel. After reaching the lower boundary of the channel at 1.1377-1.1461, a movement back to the upper boundary may begin. The European Central Bank meeting is scheduled for today, but this event may not have any influence on market sentiment. The ECB is highly likely to keep rates unchanged, meaning traders will again have nothing to respond to. Inflation in the Eurozone decreased in June but may increase in July. Therefore, even if the ECB decides to tighten monetary policy, it is unlikely to happen before September. The flat trend for the euro has been ongoing for almost a month, and there is nothing to be done about it.

5M Chart of the EUR/USD Pair

On the 5-minute timeframe on Wednesday, novice traders may have witnessed the apex of the trend over the last month. This time, volatility was 25 pips, and the price traded exclusively sideways throughout the day. Given the nature of the movement, even if trading signals had been formed, it would have been impossible to make a profit.

How to Trade on Thursday:

On the hourly timeframe, both trend lines have been broken and are no longer relevant. Considering all the events and movements in the market over the past months, we believe that the European currency should show confident growth—much stronger than in recent weeks. However, the current upward movement is essentially a correction, and in recent weeks the movement looks much more like a flat than a trend.

On Thursday, novice traders may open short positions targeting 1.1363-1.1377 if the price bounces from the area of 1.1461-1.1466. Long positions can be opened with a target of 1.1461-1.1466 if the price bounces from the area of 1.1363-1.1377. We would still not expect strong movements.

On the 5-minute timeframe, the following levels should be considered: 1.1267-1.1275, 1.1363-1.1377, 1.1461-1.1466, 1.1527-1.1531, 1.1584-1.1594, 1.1655-1.1666, 1.1745-1.1754. On Thursday, the ECB meeting and Christine Lagarde's speech will take place in the Eurozone. The ECB is unlikely to raise rates, so the meeting may turn out to be "eventless," and the market's reaction may be absent. Recall that a month and a half ago, the market did not respond at all even to monetary policy tightening.

Basic Rules of the Trading System:

1. The strength of a signal is determined by the time it takes to form (a bounce or a breakout). The less time it took, the stronger the signal.
2. If two or more trades were opened at a particular level on false signals, all subsequent signals from that level should be ignored.
3. In a flat, any pair can form many false signals or none at all. Technical levels may be ignored.
4. On the hourly timeframe, trading signals from the MACD indicator should be executed only when volatility is good, and a trend is confirmed by a trend line or channel.
5. If two levels are too close together (5 to 20 pips), they should be considered a support or resistance area.
6. After moving 15 pips in the correct direction, a Stop Loss should be placed at breakeven.

What's on the Charts:

Price levels (areas) of support and resistance are targets when opening long or short positions or sources of signals.

Red lines indicate channels or trend lines that display the current trend and indicate the preferred direction for trading.

The MACD indicator (14,22,3) – histogram and signal line – is a supplementary indicator that can also be used as a source of signals.

Important speeches and reports (contained in the news calendar) can significantly impact the movement of the currency pair. Therefore, during their release, trading should be conducted with maximum caution, or one should exit the market to avoid sharp reversals against preceding movements.

Beginners trading in the forex market should remember that not every trade can be profitable. Developing a clear strategy and practicing money management are key to long-term success in trading.

The GBP/USD currency pair did not show any interesting movements on Wednesday, moving only sideways throughout the day with minimal volatility. Recall that over the last week, the British pound has experienced a significant decline, which we consider a correction against the preceding three-week growth. However, it was yesterday, when the British currency stood still, that the most important report for the pound sterling—on inflation—was published. The Consumer Price Index (CPI) in the UK slowed to 2.6% in June, which is below forecasts. The lower the inflation, the greater the chances for the Bank of England to resume easing its monetary policy, which is naturally bad for the pound sterling. Yet yesterday, the pound did not show any decline or any movements at all. It could be one of two things: either the market priced this report in advance (insider information), or the market is continuing to trade by its own rules, ignoring macroeconomic and fundamental factors. We believe that both factors played a role.

From a technical perspective, the British pound continues to display a downward trend on the hourly timeframe, which is likely a correction against the upward trend on the 4-hour timeframe. The trend line supports the bears, but a consolidation above it will indicate a trend reversal. Additionally, the price is situated below the lines of the Ichimoku indicator, which also indicates a downward trend.

On the 5-minute timeframe on Wednesday, the price ignored everything. The 1.3369-1.3377 area was disregarded five times throughout the day. No good trading signals were generated. The pair moved sideways with minimal volatility throughout the day, and the market also ignored the most important inflation report.

COT Report

COT reports for the British pound show that non-commercial traders have dominated the market with sales for several consecutive months. The net position is negative, despite the long-term upward trend remaining in place. Considering events in the Middle East, it is not surprising that demand for risk currencies remains weak. The war is formally over, but the conflict persists. Geopolitics may support demand for the US dollar in the near future. However, we would not expect a strong decline in the pair until a consolidation below the trend line occurs.

In the long term, the dollar is expected to continue declining due to Donald Trump's policies, which is clearly visible on the weekly timeframe (see illustration above). The trade war will continue in one form or another for a long time, and Trump's policies are aimed directly and indirectly at weakening the US currency. The long-term upward trend remains, as evidenced by the trend line. The price recently tested this line and bounced off it. According to the latest COT report (dated July 14), the "Non-commercial" group opened 6,500 BUY contracts and closed 10,100 SELL contracts. Therefore, the net position of non-commercial traders increased by 16,600 contracts over the week, which does not influence the overall sentiment of professional players.

GBP/USD Analysis 1H

On the hourly timeframe, the GBP/USD pair continues to correct after three weeks of growth. The market continues to ignore geopolitical factors, and in recent weeks we have observed technical growth supported by weak US inflation data. After the current correction, it is quite possible to expect a resumption of growth for the British currency based on the pair's movements within the horizontal channel on the weekly timeframe.

For July 23, we highlight the following important levels: 1.3042-1.3050, 1.3096-1.3115, 1.3179-1.3187, 1.3301-1.3309, 1.3369-1.3377, 1.3465-1.3480, 1.3588, 1.3671-1.3681. The Senkou Span B (1.3439) and Kijun-sen (1.3416) lines may also serve as sources of signals. It is recommended to set the Stop Loss order to breakeven if the price moves in the right direction by 20 pips. The lines of the Ichimoku indicator may shift throughout the day, which should be considered when determining trading signals.

On Thursday, there are no significant events or publications scheduled in the UK or the US. The European Central Bank meeting will take place on this day, but how does that relate to the British pound? Most likely, we won't see interesting movements today, and the area of 1.3369-1.3377 is currently being ignored by traders. It is best to orient oneself based on the trend line and the lines of the Ichimoku indicator.

Trading Recommendations:

Today, traders may consider short positions targeting the area of 1.3301-1.3309 if the price consolidates below the area of 1.3369-1.3377. Long positions can be opened in the event of a bounce from the area of 1.3369-1.3377 with targets at the Senkou Span B and Kijun-sen lines. However, yesterday, the area of 1.3369-1.3377 was ignored throughout the day.

Explanations for Illustrations:

Support and resistance levels are represented by thick red lines, around which price movement may end. They are not sources of trading signals.

The Kijun-sen and Senkou Span B lines are Ichimoku indicator lines transferred to the hourly timeframe from the 4-hour timeframe. They are strong lines.

Extreme levels are represented by thin red lines from which the price has previously bounced. They are sources of trading signals.

Yellow lines are trend lines, trend channels, and any other technical patterns.

Indicator 1 on COT charts represents the size of the net position of each category of traders.

The EUR/USD currency pair continued to trade on Wednesday as if it were doing someone a favor. Volatility was again minimal, and for the fourth consecutive week, the price remains in a weak upward correction that borders on a flat trend. We believe that the current movement should be viewed as a flat, as the euro spends most of its time within the horizontal channel of 1.1362-1.1461. Thus, after reaching the upper boundary of this channel, movement toward the lower boundary has begun, which we have been observing for several consecutive days. Given the weakness of the movements and the presence of a flat, we do not believe that any fundamental, macroeconomic, or geopolitical factors are currently impacting the market. Individual events may provoke market reactions, but they are so weak that it is unclear whether they are market noise or actual reactions. Yesterday, there were no reports published in the Eurozone, Germany, or the US, and no fundamental events occurred. The market had nothing to react to throughout the day.

From a technical perspective, the pair maintains a slight upward bias, yet this trend is effectively a flat. The price has returned to the horizontal channel of 1.1362-1.1461, and the upward movement in recent weeks has been so weak that it is difficult to discuss it as a trend. In a flat, the Ichimoku indicator lines are weak. Volatility remains low.

On the 5-minute timeframe on Wednesday, the price bounced off the Senkou Span B line twice and seemingly formed two sell signals. However, what is the point of these signals if the price moved sideways throughout the day, with an overall volatility of 25 pips? If there are no movements, any signals will not yield profits.

COT Report

The latest COT report is dated July 14. The illustration on the weekly timeframe shows that the net position of non-commercial traders remains bullish, but has significantly decreased due to geopolitical events. Traders have been getting rid of the European currency in favor of the US dollar in recent months. Donald Trump's policy has not changed, but the dollar has acted as a "reserve currency" for some time. However, this process may have already come to an end.

We still do not see any fundamental factors for the strengthening of the euro, while sufficient factors for the decline of the US dollar remain. The war in the Middle East has made the dollar temporarily super-attractive, but when this factor reaches its "expiration date," everything will return to normal. And that expiration may have already come. In the long term, the euro could fall to as low as 1.08$ (the trend line), but the upward trend will still remain relevant. Over the past months of dollar growth, the pair has not moved significantly closer to this line.

The positioning of the red and blue lines of the indicator indicates parity between bulls and bears. During the last reporting week, the number of long positions in the "Non-commercial" group increased by 6,900, while the number of shorts increased by 3,300. Accordingly, the net position increased by 3,600 contracts over the week.

EUR/USD Analysis 1H

On the hourly timeframe, a corrective upward trend continues to form, which is essentially a flat. The situation in the Middle East remains tense and has not improved. The market continues to ignore many factors in favor of the euro, preventing the European currency from showing any significant growth. However, in recent weeks, the dollar has also failed to show growth. The market is simply stagnant.

For July 23, we highlight the following trading levels — 1.1234, 1.1274, 1.1362, 1.1461, 1.1536-1.1542, 1.1585, 1.1657-1.1666, 1.1750-1.1760, 1.1786, 1.1830-1.1837, as well as the Senkou Span B line (1.1430) and Kijun-sen (1.1425). The lines of the Ichimoku indicator may move during the day, which should be considered when determining trading signals. Remember to set a Stop Loss order to breakeven if the price moves in the right direction by 15 pips. This will protect against potential losses if the signal turns out to be false.

On Thursday, the European Central Bank meeting will take place in the Eurozone, which the market is ignoring, and it is expected that rates will remain unchanged with a probability of 90%. In the US, there will be a report on jobless claims, which is not expected to have a significant impact. Therefore, we are unlikely to see strong movements today or the end of the flat.

Trading Recommendations:

Today, traders may consider short positions targeting 1.1362 if the price bounces from the area of the Senkou Span B and Kijun-sen lines. Long positions can be opened with targets of 1.1461 and 1.1480 if the pair consolidates above the Senkou Span B line. It should be remembered that there are currently virtually no movements in the market.

Explanations for Illustrations:

Support and resistance levels are represented by thick red lines, around which price movement may end. They are not sources of trading signals.

The Kijun-sen and Senkou Span B lines are Ichimoku indicator lines transferred to the hourly timeframe from the 4-hour timeframe. They are strong lines.

Extreme levels are represented by thin red lines from which the price has previously bounced. They are sources of trading signals.

Yellow lines are trend lines, trend channels, and any other technical patterns.

Indicator 1 on COT charts represents the size of the net position of each category of traders.

The GBP/USD currency pair continued its downward movement on Wednesday after three weeks of growth. Over the past month, the British pound has been moving very technically. The rise began around June 23 when the pair hit the area at the lower boundary of the sideways channel it has been in for a year. Since there have been no reasons for a long-term dollar trend, a reversal occurred near the channel boundary, and the movement began toward the opposite boundary. We then saw a three-week rise of 400 pips, driven by both technical and fundamental factors. Recall that the last surge in the US dollar was completely illogical. The Federal Reserve had not even begun tightening its monetary policy, yet the market rushed to buy dollars as if Kevin Warsh had promised to raise the key rate three times by the end of the year. A month and a half has passed, and the market is now doubting the tightening in July or September. Inflation in the US is falling, and if Donald Trump ends the war with Iran (which would be advantageous for him ahead of the elections), inflation will continue to decline, and tightening by the Fed will not be necessary at all.

Now we are observing a decline that has lasted about a week. Despite the UK unemployment and labor market reports on Tuesday being sufficiently positive for the pound to rise, the pound fell. Why? Because a simple technical correction began. On Wednesday, the inflation report for June was released, showing a slowdown to 2.6% year-on-year, while the market had expected a slowdown to 2.7%. It should be noted that British inflation has hardly reacted to geopolitical events in the Middle East or the energy crisis. It may still react, but for now, it has not. Therefore, the chances that the Bank of England will tighten monetary policy in 2026 have decreased even further.

Should this result in new sales of the British pound? In our opinion, no. Back in May, it became clear that British inflation does not depend on oil prices, and the next two months confirmed this assumption. Therefore, it was evident several months ago that the Bank of England would hardly raise its key rate if inflation continues to decline. Thus, the new slowdown in inflation brings the British central bank closer to easing its policy, but at the same time, Andrew Bailey warned that the consumer price index could accelerate in the second half of 2026. This suggests that inflation will likely remain between 2.5% and 3.5% over the next six months, which is not sufficient for either easing or tightening policy. Thus, the current inflation report has no long-term or global implications for the British pound.

The average volatility of the GBP/USD pair over the last 5 trading days as of July 23 is 69 pips. For the pound/dollar pair, this value is considered "average." Therefore, on Thursday, July 23, we expect the pair to move within the range limited by levels 1.3296 and 1.3434. The upper linear regression channel is pointing downward, indicating a bearish trend. The CCI indicator has formed a bearish divergence and entered the overbought area, signaling the start of a downward correction.

Nearest Support Levels:

S1 – 1.3367

S2 – 1.3306

S3 – 1.3245

Nearest Resistance Levels:

R1 – 1.3428

R2 – 1.3489

R3 – 1.3550

Trading Recommendations:

The GBP/USD currency pair maintains a downward trend, which is presumably a correction within a global upward trend, as clearly seen on the daily or weekly timeframe. The global fundamental backdrop for the dollar remains negative, but 2026 appears super-positive for the dollar due to geopolitical factors, although every fairy tale comes to an end. However, the weekly timeframe remains flat between 1.3150 and 1.3780 within a four-year upward trend, allowing for expectations of a continuation of growth for the British currency in the medium term. Long positions with targets of 1.3489 and 1.3550 can be considered when the price is above the moving average. When the price is below the moving average line, bearish positions can be considered with targets of 1.3306 and 1.3296.

Explanations for Illustrations:

Linear regression channels help determine the current trend. If both are directed in one direction, it indicates that the trend is currently strong;

The moving average line (settings 20,0, smoothed) defines the short-term trend and the direction in which trading should currently be conducted;

Murray levels are target levels for movements and corrections;

Volatility levels (red lines) represent the likely price channel in which the pair will spend the next day, based on current volatility metrics;

The CCI indicator's entry into the oversold area (below -250) or the overbought area (above +250) means that a trend reversal is approaching in the opposite direction.

The EUR/USD currency pair did not show any interesting movements on Wednesday, and during the day, traders could only pay attention to the UK inflation report, which, for obvious reasons, has nothing to do with the European currency. Thus, the euro continues to live its own life, and the British pound has its own. Life for the European currency is considerably more boring at this time. For the fourth consecutive week, the pair has been in sideways movement with a slight upward inclination. Volatility indicators have dropped to minimal levels. Over the last thirteen days, the pair has moved more than 50 pips on only three occasions. In our view, this fact best indicates the market's lack of desire to open any positions. The market continues to wait, and a sideways trend is an integral part of any trend.

Unfortunately, predicting the beginning of a flat is nearly impossible, and predicting its end is even harder. We do not know when the market will resume active trading, but from experience, we can say that it usually happens out of the blue. If there is a forthcoming meeting of the Federal Reserve on the horizon, it is highly likely that the flat will not finish on that day but on the following day, when macroeconomic or fundamental background is absent. Charts, technical indicators, waves, patterns, and so forth are just images. Currency rates are ruled by real people, banks, and corporations. There is a constant battle for profit and more advantageous positions for trades in the market. Therefore, we often see movements that are extremely difficult to explain, as manipulations and deliberately false positions can occur.

On Thursday, the European Central Bank will summarize the results of its fifth meeting this year. At the last meeting, the central bank decided to raise rates in response to rising inflation. However, given the slowdown in inflation to 2.6% in June, the ECB prefers to take a wait-and-see approach at this time. Recall that inflation is currently dependent on oil prices, and oil prices are influenced by geopolitics. Iran and the US have been engaged in hostilities for ten days (after a ceasefire ended), but this does not necessarily mean that they will not return to negotiations tomorrow, or that the Strait of Hormuz will not be opened (for a couple more weeks, until the next ceasefire violation). Therefore, the ECB, the Federal Reserve, and the Bank of England will have to react based on the situation. If inflation rises, rates need to be increased. If inflation falls, rates do not need to be raised. Unfortunately, these "swings" can be observed for a very long time, and predicting future changes in monetary policy is simply unprofessional under the current circumstances.

Since the ECB is not planning to change monetary policy parameters in June, it is unlikely that we will see strong movements in the market today. Christine Lagarde is unlikely to provide the market with any specific details about the central bank's future actions. Therefore, the flat is likely to continue today, and volatility is expected to remain low. Recall that a month and a half ago, when the ECB raised all three rates, the market did not respond at all.

The average volatility of the EUR/USD currency pair over the last 5 trading days as of July 23 is 36 pips and is characterized as "low." We expect the pair to move between 1.1371 and 1.1443 on Thursday. The upper linear regression channel is pointing downward, indicating the continuation of a downward trend. The CCI indicator has entered the oversold area and has formed two bullish divergences, warning of a possible end to the downward trend.

Nearest Support Levels:

S1 – 1.1414

S2 – 1.1353

S3 – 1.1292

Nearest Resistance Levels:

R1 – 1.1475

R2 – 1.1536

R3 – 1.1597

Trading Recommendations:

The EUR/USD pair maintains a downward trend, which is presumably a correction within a global upward trend, as is clearly seen on the daily or weekly timeframe. The global fundamental backdrop for the dollar remains negative, but in 2026, initially geopolitical factors and then the "hawkish" stance of the Fed provided substantial support for the US dollar. When the price is below the moving average, short positions can be considered with targets of 1.1371 and 1.1353. Above the moving average line, long positions are relevant with targets of 1.1443 and 1.1475. The market has been in a flat for the fourth consecutive week.

Explanations for Illustrations:

Linear regression channels help determine the current trend. If both are directed in one direction, it indicates that the trend is currently strong;

The moving average line (settings 20,0, smoothed) defines the short-term trend and the direction in which trading should currently be conducted;

Murray levels are target levels for movements and corrections;

Volatility levels (red lines) represent the likely price channel in which the pair will spend the next day, based on current volatility metrics;

The CCI indicator's entry into the oversold area (below -250) or the overbought area (above +250) means that a trend reversal is approaching in the opposite direction.

The EUR/GBP cross has recorded its fourth consecutive session of growth, continuing its recovery from multi-year lows around 0.8455. The key driver of the pair's rise has been the mixed inflation data from the UK published on Wednesday.

The Consumer Price Index (CPI) in June slowed to 2.6% year-on-year from 2.8% in May, falling below forecasts of 2.7%. However, the core measure, excluding volatile components, remained at 2.6%, surpassing expectations of 2.5%. This indicates persistent inflationary pressure in the economy despite the overall slowdown.

Fundamental Background: Monetary Divergence and Geopolitics

Bank of England: Pause in Tightening. Published data on inflation and the labor market (wage growth has slowed, hiring has weakened) reduced pressure on the BoE to tighten policy immediately. The slowdown in inflation to 2.6% essentially rules out the possibility of a rate increase at the BoE meeting in July. Markets are fully pricing in a 25 basis point hike only at the November meeting, and analysts warn that restrictive policy amid a weak economy raises the risk of downward revisions to rate expectations.

Fiscal Risks in the UK. Additional pressure on the pound comes from uncertainty surrounding the fiscal policy of new Prime Minister Andy Burnham. Investors are assessing how the government will finance its spending plans, reviving concerns about the sustainability of public debt. Initial optimism regarding the leadership change is quickly fading, and risks to the UK's fiscal stability are returning to the spotlight.

ECB: Expectations of a "Hawkish" Pause

Market attention on Wednesday was focused on the ECB meeting. It is widely expected that the central bank will keep the deposit rate at 2.25% after the hike in June. However, the key signal will be the rhetoric from President Christine Lagarde. The markets expect her to "keep the door open" for a rate hike in September amid persistent inflationary risks, especially considering the rise in energy prices due to geopolitical tensions.

Geopolitical Factor. The resumption of hostilities between the US and Iran and threats to block straits are pushing oil prices higher, reviving global inflation concerns. This places additional pressure on the pound, as the UK is a net importer of energy, but it also supports expectations for tightening ECB policy, which provides support to the euro.

Brief Technical Analysis

From a technical perspective, trading above the important short-term support level of 0.8515 (200 EMA on the 1-hour chart), EUR/GBP retains a short-term bullish outlook. On the 4-hour chart, the price is moving towards the next resistance zone of 0.8551-0.8587 (144- and 200-period EMA). At the same time, despite the correction observed since the beginning of the year, the global trend for the pair remains bullish.

The strategic support level of 0.8477 (144 EMA on the monthly chart) has held, providing the necessary support for the price.

Now, for the pair to resume its long-term and medium-term bullish trend, it needs to overcome key resistance levels at 0.8598 (200 EMA on the weekly chart), 0.8635 (200 EMA on the daily chart, 50 EMA on the weekly chart), and continue to rise.

• RSI (14) on the 4-hour chart is around 60-62, indicating bullish momentum.
• OsMA and Stochastic on the 4-hour chart also recommend long positions.

The nearest resistance is located at 0.8551 and 0.8568. A breakout above with confirmation from indicators may open the path to 0.8587 (50 EMA on the daily chart) and 0.8600, followed by the 0.8635–0.8700 zone. The nearest support is at 0.8515 (key level and 200 EMA on the 1-hour chart), 0.8500, and 0.8477. A breakout below with confirmation from indicators may open the way to re-testing annual lows.

Key Events to Watch

Conclusion and Recommendations for Investor

On Thursday, the European Central Bank will hold its next meeting, and most analysts and market participants agree that the ECB will keep all three interest rates unchanged. This is supported by the slowdown in inflation in the Eurozone to 2.8% in June. However, experts also note that the likelihood of a second consecutive round of monetary policy tightening remains. A rate hike for the second time in a row will be implemented if the ECB's medium-term inflation forecasts indicate further increases.

We cannot judge the ECB's forecasts, but it is clear that no slowdown in the consumer price index is expected by the end of July. Brent crude oil has risen to $93-94 per barrel and may exceed $100 by Friday. Consequently, oil prices will return to a range that has previously shocked the markets. If the Strait of Hormuz is not unblocked soon, the $100-120 per barrel range will become the norm. Throughout the active phase of the conflict in March-April, oil prices were indeed in this range. As a result, inflation could also return to the levels seen in April-May. In this case, the ECB will need to resume tightening policy; the only question is whether the central bank will choose to act preemptively.

Christine Lagarde stated during the economic forum in Sintra that the rate hike in June was a reaction to rising inflation. According to ECB forecasts, inflation is not expected to return to 2% before the end of 2027, and only with continued monetary policy tightening. If rates have to be raised to achieve lower inflation, what difference does it make when exactly? Based on this, the likelihood of a tightening in ECB policy is not that low.

But what benefit could the euro gain from a "hawkish" move by the ECB? In my opinion, none. A month and a half ago, the market simply ignored the tightening of policy, although the ECB remains the only G7 central bank to raise rates in response to the energy crisis and rising prices. Therefore, a similar move in July or September may also not impact the euro's exchange rate. According to the current wave analysis, the EUR/USD instrument has not yet completed the formation of its downward trend segment, and the market is in no hurry to buy euros. Thus, if we do see a rise in the euro, it will likely occur after the completion of wave 5 in C. Only then might the market take notice of the ECB's rate hikes.

Wave Analysis on EUR/USD:

Based on my analysis of EUR/USD, I conclude that the instrument remains within an upward trend segment, while in a shorter-term perspective, it is within a downward trend segment. In my opinion, it is a good time to attempt to establish long positions, though the instrument may still drop to the 13th figure as part of wave 5 in C. Wave analysis often brings surprises, so I would start to readjust towards buying.

Wave Analysis on GBP/USD:

The wave analysis for the GBP/USD instrument has taken on a rather complex form. The instrument has currently completed three waves down, while EUR/USD could form five waves. Thus, the British pound may also form one more wave down, as will the euro, but this wave could be the second one within a new upward trend segment. Therefore, the divergence in wave structures of the euro and pound will exist but will likely be insignificant. Based on this, I anticipate a downward pullback soon, followed by the development of a new upward trend segment, with initial targets located around the 37-38 figures.

Key Principles of My Analysis:

1. Wave structures should be simple and understandable. Complex structures are difficult to trade as they often require adjustments.
2. If there is no confidence in what is happening in the market, it is better not to enter.
3. There is never and can never be 100% certainty regarding the direction of movement. Don't forget about protective stop-loss orders.
4. Wave analysis can be combined with other forms of analysis and trading strategies.

At first glance, the latest macroeconomic data should suggest a dovish stance from the ECB. For example, June inflation in the Eurozone slowed to 2.8% year-on-year from 3.2% in May. Economic activity in the region also remains weak, with Eurozone GDP growth estimated at only 0.2%, and growth prospects continue to deteriorate. Just a few weeks ago, these factors allowed markets to consider a possible rate cut in the second half of the year.

However, the situation has significantly changed following a new round of escalation in the Middle East. The sharp rise in oil prices over the past month has again posed the ECB the problem of a potential second wave of inflationary pressure. For the European economy, which is highly dependent on energy imports, an increase in oil prices means not only a rise in overall inflation but also a risk of renewed increases in production costs, transport expenses, and service prices. For this reason, many members of the ECB's governing council have noticeably tightened their rhetoric in recent weeks.

Another "warning sign" for the central bank is the persistence of core inflation. Despite the slowdown in overall CPI, domestic price pressures remain quite strong due to wage growth and a relatively resilient labor market. For the ECB, these components are key and largely decisive, as they reflect long-term inflationary processes, rather than temporary fluctuations in energy prices.

Therefore, the July ECB meeting is unlikely to be characterized as "dovish." The most probable scenario is a "hawkish pause." This means the central bank will maintain all parameters of monetary policy unchanged while delivering a relatively tough rhetoric. Specifically, Lagarde will reiterate that the ECB remains "fully data-dependent, does not commit to any obligations, and is ready to act decisively in the event of a deterioration in the inflation outlook." Essentially, this is a standard set of phrases that Lagarde has used multiple times. However, in light of the rapid rise in oil prices, these standard phrases may take on new significance, as the risks of a new wave of inflationary pressure have noticeably increased.

At the same time, Lagarde is unlikely to signal a potential rate hike at the September meeting, aiming to maintain a balanced nature in her rhetoric.

Major investment banks also agree that the most likely outcome of the July meeting will be a "hawkish pause" scenario.

For instance, analysts at ING believe that the ECB will keep rates unchanged; however, Lagarde's speech will have a distinctly hawkish tone. In their view, a rate hike in September will become the baseline scenario if oil prices remain at current levels or continue to rise in the medium term.

Economists at Citigroup also do not expect any changes to rates in July but allow for one hike by the end of the year if high energy prices begin to translate into sustained growth in core inflation and wages.

A similar stance is echoed by analysts at Bank of America. The bank believes that the recovery of energy prices significantly increases the likelihood of a rate hike in September. However, in the longer term, BoA experts still expect inflation to return to the target of 2% and for monetary policy to gradually soften.

Overall, according to a Reuters survey, about 70% of economists expect one more rate hike from the ECB by the end of the year, with September being the most likely month cited. At the same time, nearly a third of experts polled believe that the acceleration of inflation in June could turn out to be temporary, meaning the ECB may indeed refrain from further tightening.

Thus, the formal outcomes of the July meeting are likely to be neutral, while the accompanying statement and Lagarde's rhetoric are likely to be noticeably firmer than expected a month ago. The latest macroeconomic data could certainly justify a softer tone; however, the renewed rise in oil prices and heightened inflation risks will prevent the ECB from even hinting at a soon softening of monetary policy.

The euro's reaction will depend on how "hawkish" Lagarde's rhetoric turns out to be. The market is likely to ignore standard vague formulations stating that further decisions will depend on incoming data. However, even a theoretical hint at the possibility of a rate hike in the foreseeable future would provide significant support for the euro and, accordingly, for EUR/USD buyers. In this case, the pair is likely to test the upper boundary of the established range of 1.1410 – 1.1470, which corresponds to the upper line of the Bollinger Bands indicator on the D1 timeframe.

On Wednesday, the GBP/JPY pair was attracting attention from some intraday sellers, dropping to the 218.00 level. Nevertheless, spot quotes remain within the wider range established the day before, owing to a favorable fundamental situation.

The British pound has slightly weakened following the release of mixed inflation data in the UK. At the same time, the Japanese yen received a modest boost after a Bloomberg report indicated the Bank of Japan's representatives' intention to accelerate the rate hike process. Furthermore, rumors regarding potential intervention by Japanese authorities to support the national currency are contributing to the closing of short positions in yen, applying certain pressure on the GBP/JPY exchange rate.

The UK's Office for National Statistics (ONS) reported that in June, the annual core Consumer Price Index (CPI) rose by 2.6%, which did not meet expectations of a slight decline to 2.7% from the previous level of 2.8%. Additional data showed that the core CPI (excluding volatile food and energy prices) also rose by 2.6% year-on-year, exceeding the forecast of 2.5%. However, this data dampened hopes for a rate hike from the Bank of England and exerted pressure on the pound.

ING analysts note that "despite higher-than-expected core inflation data in the UK for June," their UK economist James Smith believes that the main trend is moving in the right direction. Smith points to easing price pressures from food and fuel and a decline in inflation in core services as evidence that domestic price pressures are becoming more moderate, which contributed to the decline of the pound sterling.

However, the immediate market reaction remains moderate, as it seems participants have already priced in a 0.25% hike from the Bank of England by September. A second rate increase is also anticipated by the end of 2026, which would bring the official level to 4.25%. Meanwhile, the BoJ's short-term rate stands at 1.0%, creating a significant interest rate gap that continues to support carry trades with the Japanese yen and acts as a tailwind for the GBP/JPY pair, cautioning bears from taking action.

Additionally, investors remain concerned about the economic risks related to the US-Iran conflict around the Strait of Hormuz, as Japan relies on oil imports through this vital waterway for more than 90%. This indicates that the path of least resistance for the Japanese yen remains downward, making it prudent to wait for a substantial continuation of sell-offs before opening positions to correct the GBP/JPY pair from levels reached last week, which represent the highest level since January 2008.

From a technical perspective, the pair found support at the 9-day EMA and the round level of 218.00. A drop below this level would support the 14-day EMA and the round level of 217.00. Below that, the 20-day SMA would still leave bulls a chance. However, as long as the oscillators remain positive, bulls have the advantage.

The USD/JPY pair has entered a bullish consolidation phase and remains stable above the 163.00 level, close to the highest rate reached in 1986. However, traders are cautious due to speculation about potential intervention by Japanese authorities to support the national currency, which could hinder further price increases. Nonetheless, the favorable fundamental backdrop indicates the feasibility of continuing the recent stable upward trend.

Investors continue to pay close attention to the significant difference in interest rates between Japan and the US, which supports carry trades and is a key factor in the relative weakening of the Japanese yen. Additionally, economic risks related to ongoing conflicts in the Middle East are also negatively affecting the yen's performance.

The US dollar, on the other hand, maintains its recent gains over the past four days, providing additional support for the USD/JPY pair and further affirming a positive outlook.

The Bank of Japan cautiously began the normalization process of monetary policy, raising the short-term interest rate to 1.00% in June, the highest level since 1995. In turn, the US Federal Reserve is expected to maintain its target rate in the range of 3.50% to 3.75% at the upcoming monetary policy meeting in July. Nevertheless, this leaves a difference of 250-275 basis points, stimulating traders to utilize higher-yielding assets.

Meanwhile, the ongoing confrontation between the US and Iran creates geopolitical risks, which, along with the closure of the Strait of Hormuz, heighten uncertainty in global energy markets. As Japan relies on imports of crude oil through this critical waterway for more than 90%, these events raise concerns regarding the state of the Japanese economy and contribute to bearish sentiment regarding the yen. The inflation risk arising from rising energy prices also supports expectations of interest rate increases by the Fed, which bolsters the US dollar and the USD/JPY pair.

On Wednesday, no significant US economic data is expected to influence the market, so the US dollar will depend on comments from leading FOMC members. Additionally, further developments in the US-Iran situation may continue to bring volatility to financial markets, adding pressure to the dollar and momentum to the USD/JPY pair. Nevertheless, the aforementioned factors suggest that the path of least resistance for spot prices is upward.

From a technical perspective, the primary support for the pair is the 9-day EMA. A resistance level is seen at 163.23. Oscillators are positive, indicating that bulls hold an advantage.

The table below shows the percentage change of the Japanese yen against major currencies this week, with the yen demonstrating the most significant activity against the Canadian dollar.

Brent crude has surged to $95 per barrel over the past two weeks, and rising oil prices have unsettled the bond market. Yields on 10-year and 30-year U.S. Treasury bonds have climbed to two-month highs amid concerns that inflationary pressures could force the Federal Reserve to raise interest rates. Investors have once again begun treating geopolitics as a key driver of central bank policy, but this time the ECB—not the Fed—will speak first.

ECB Rate Expectations

The ECB Governing Council will meet on July 23, one week before the Federal Open Market Committee (FOMC). The benchmark rate is widely expected to remain unchanged at 2.25%, but policymakers are likely to signal their readiness to continue the tightening cycle. In June, the ECB raised borrowing costs for the first time since 2023, citing the prolonged impact of higher energy prices following the closure of the Strait of Hormuz. Inflation had accelerated to 3.2% from 1.9% in February before easing to 2.8% in June—still above the ECB's target.

Bank of Greece Governor Yannis Stournaras believes the latest spike in prices has effectively reset the ECB's inflation battle. Meanwhile, BNP Paribas argues that the threshold for another rate hike has become lower because policymakers no longer need to prove the existence of second-round inflation effects. Markets will be listening closely to ECB President Christine Lagarde to see whether she abandons her May characterization of inflation risks as "balanced." Investors currently expect at least one additional 25-basis-point rate hike before year-end, most likely in September, followed by another increase next year that would bring the deposit rate to 2.75%.

Fed Rate Expectations

The situation in the United States is markedly different. The first inflation data released under new Fed Chair Kevin Warsh suggest that inflation is easing rather than accelerating. Consumer prices unexpectedly declined in June for the first time in six years, with annual inflation falling to 3.5% from 4.2%. Core inflation appears even more subdued at 2.6%. Warsh has maintained a cautious stance and has avoided declaring victory over inflation, but markets have already reduced expectations for further Fed rate hikes this year.

This creates an interesting divergence: while Europe appears to be preparing for another round of monetary tightening driven by higher energy prices, the United States may gain greater policy flexibility thanks to moderating inflation. The key question is whether this divergence will be enough to support EUR/USD, or whether rising Brent prices will ultimately favor the U.S. dollar in its traditional role as a safe-haven currency.

Technical Outlook

On the daily chart, EUR/USD continues to consolidate in the lower portion of its fair value range between 1.1385 and 1.1485. Unless the pair breaks decisively outside this range, it is likely to remain directionless. For now, range trading within these boundaries continues to be the preferred strategy.

The wave structure on the 4-hour EUR/USD chart continues to evolve. There is still no indication that the bullish trend segment (shown in the lower chart), which began in January of last year, has been invalidated. However, the overall structure has now taken on the characteristics of a corrective pattern. From a long-term perspective, Wave C is expected to develop, with its low positioned below the low of Wave A. At present, Wave C has already moved below the low of Wave A, meaning it could be completed at any time. However, if the news backdrop remains favorable for the U.S. dollar, this wave may extend further.

On the lower timeframe, I can identify a classic five-wave bearish structure. If this interpretation is correct, the market is currently forming Wave 4, while Wave 3 has already developed into a five-wave pattern. Once this structure is complete, the pair may transition into a new bullish wave sequence. However, based on the current wave count, Wave 5 is still expected to form. Consequently, the euro could decline toward the 1.13 level.

EUR/USD gained 20 basis points on Wednesday, with trading activity once again remaining subdued. The market still sees little reason to either buy or sell the euro, which explains the lack of participation. At times, this appears unusual, given that economic data continues to be released, central banks are holding policy meetings, and geopolitical headlines remain constant.

I can understand why traders are ignoring geopolitical developments. Looking at the flood of contradictory and often confusing news over the past several months, it is easy to see why many participants have chosen to tune it out. However, the market is also largely ignoring economic data and has been unable either to complete the current bearish trend or begin building a new bullish one.

Today, reports emerged that Donald Trump is considering launching additional strikes against Iran, although it is unclear how these would differ from the ongoing military operations. The United States continues its attacks on Iran, while Iran continues retaliatory strikes against U.S. military bases and naval assets. In short, the conflict in the Middle East remains in an escalation phase, while oil prices continue to climb almost daily.

As a result, inflation is likely to accelerate in both the United States and the eurozone in July. The European Central Bank may continue tightening monetary policy, while the Federal Reserve is once again weighing whether additional tightening is justified.

The ECB is scheduled to announce its latest policy decision tomorrow, and interest rates are widely expected to remain unchanged. Therefore, anyone expecting Thursday's meeting to trigger a breakout from the current trading range may be disappointed. The euro continues to edge lower, although Wave 4 within Wave C could still evolve into a more complex five-wave corrective structure.

Overall Outlook

Based on my analysis, EUR/USD remains within a long-term bullish trend segment (shown in the lower chart), while the shorter-term outlook remains bearish. In my view, this is a reasonable period to begin considering long positions, although the pair could still decline toward the 1.13 level as Wave 5 of Wave C unfolds. Wave structures often produce unexpected developments, so I would already begin shifting my focus toward buying opportunities.

On the higher timeframe, the previous bullish trend has transitioned into a corrective wave sequence. In the near term, Wave C is expected to develop toward the 1.1352 level, corresponding to the 38.2% Fibonacci retracement. Once the A-B-C corrective structure is complete, a new long-term bullish trend may begin.

Key Principles of My Analysis

1. Wave structures should be simple and easy to interpret. Complex patterns are difficult to trade and frequently change.
2. If market conditions are unclear, it is better to stay out of the market.
3. There is never complete certainty about market direction. Always use Stop Loss orders to manage risk.
4. Wave analysis can be effectively combined with other analytical methods and trading strategies.

GBP/USD has posted strong gains in recent weeks, which could mark the beginning of a broader bullish trend. However, bullish traders have now paused. The pound's rally was exceptionally rapid, and such moves rarely last for long without a correction. Therefore, I expect a corrective pullback, which has already begun and could last for several weeks.

This week's fundamental backdrop for the pound has been mixed. The labor market data—particularly the unemployment and wage reports—were generally supportive. However, the inflation report disappointed. UK inflation slowed more than traders had expected, which, in my opinion, effectively closes the discussion about further monetary tightening by the Bank of England. Instead, attention may gradually shift toward the possibility of policy easing later this year.

It is worth recalling that Bank of England Governor Andrew Bailey made it clear at the latest policy meeting that the disinflation process is continuing and that inflation could return to the 2% target next year. The closer inflation moves toward that target, the greater the likelihood of an interest rate cut. As a result, the growing dovish sentiment surrounding the Bank of England provides a logical explanation for the pound's current decline, which is being reinforced by an ongoing corrective pullback.

The outlook for the FOMC is far less straightforward. Initially, markets expected U.S. inflation to accelerate unless the Fed tightened monetary policy. Later, concerns over inflation eased as oil prices fell to around $70 per barrel. This week, however, oil has climbed to $94, and the latest escalation in the Middle East, combined with the closure of the Strait of Hormuz, could push prices as high as $120.

If the most pessimistic scenario unfolds, oil could return to the $100–120 level as early as next week. In that case, hopes for slowing inflation in either the United States or the United Kingdom would likely disappear. Conversely, if tensions ease, oil prices could fall back to the $60–70 level, reducing the need for further Fed tightening. For that reason, the U.S. dollar cannot currently rely on the Federal Reserve's hawkish stance for sustained support.

From a technical perspective, the chart continues to favor the bulls. The pair first swept liquidity below the April 6 low and later below the March 31 low, providing a solid foundation for the pound's rally in recent weeks. Given that the U.S. dollar still lacks compelling long-term bullish drivers—and has already posted substantial gains in 2026—I believe the bears are unlikely to maintain control for much longer.

Price reacted twice to Bullish Imbalance 23, giving traders profitable long opportunities. At present, however, no new technical patterns have emerged, leaving no clear areas of interest for either long or short positions.

Wednesday's economic calendar was relatively light. The only notable release in the UK was the inflation report, which came in weaker than expected. This miss could continue to weigh on the pound, although the current corrective pullback may already be approaching its conclusion. Unfortunately, there are no actionable chart patterns at the moment. Traders will have to wait for new setups to develop or for liquidity to be swept from key swing levels.

From a broader perspective, I still see little reason to expect anything other than long-term weakness in the U.S. dollar. Neither the conflict between Iran and the United States nor the possibility of Fed rate hikes in 2026 has fundamentally altered that view. Geopolitical tensions temporarily reminded investors of the dollar's safe-haven status, but the conflict has already passed its most intense phase.

Although the Federal Reserve plans to raise interest rates in 2026—a supportive factor for the dollar—it is important to remember that tighter monetary policy will likely slow both economic growth and the labor market. In addition, Kevin Warsh was appointed by President Donald Trump to lead the FOMC with the goal of eventually easing monetary policy, something Jerome Powell was unwilling to do. Therefore, in my view, any appreciation of the U.S. dollar is likely to be temporary rather than the beginning of a sustained long-term trend.

Economic Calendar for the United States and the United Kingdom

• United States: Initial Jobless Claims (12:30 UTC)

The July 23 economic calendar contains only one event, and it is unlikely to influence trader sentiment. As a result, Thursday's economic backdrop is expected to have little or no impact on the market.

GBP/USD Forecast and Trading Outlook

The long-term outlook for the pound remains bullish. Following liquidity sweeps below the two most recent swing lows, the bulls regained control of the market. The pound could still resume its decline toward the bullish trend invalidation level at 1.3007, but that would require new bearish signals, which are currently absent.

The bullish case is supported by the two liquidity sweeps and Bullish Imbalance 23. Although the bullish reaction from that imbalance has already played out and the market has entered a corrective phase, the longer-term upside targets remain the May 1 high at 1.3656 and the January 27 high at 1.3867. However, opening new long positions at this stage would require new bullish patterns, and none have formed yet.

The EUR/USD pair remains within the local bearish impulse that began on April 17, while over the past three weeks the bulls have managed to push the bears back only slightly. Although the bulls have launched an attack, there has been little conviction behind the move. In my view, the euro is currently much closer to another decline than to an extension of its modest recovery. Over recent weeks, bullish traders have demonstrated little strength. The new week began with another, albeit minor, decline in the euro. The latest liquidity sweep points to a high probability that the downward move will continue. It is difficult to say how deep or prolonged the decline may be, but the bears have one clear target—the latest swing low at 1.1325. A liquidity sweep below that level could provide the bulls with a second opportunity. As for the fundamental backdrop, I still see little justification for the bears' continued dominance. Geopolitical developments have once again disappointed, but they are unlikely to be a decisive factor for traders, who barely reacted to either the temporary ceasefire or the reopening of the Strait of Hormuz. In my opinion, the bears may squeeze a bit more downside from the market, but they will not be able to sustain their offensive on enthusiasm alone. Tomorrow's ECB meeting is unlikely to generate much interest, especially following the recent decline in eurozone inflation.

It is also worth recalling that the latest U.S. labor market data were relatively weak, while the inflation report showed further easing. Job creation remains subdued. Over the past three months, the U.S. economy has added roughly 100,000 fewer jobs than traders had expected. As a result, slowing employment growth and easing inflation have cast doubt on the likelihood of a near-term FOMC rate hike. The U.S. dollar can no longer rely on Federal Reserve policy as a source of support.

Geopolitics has moved into the background. Tehran and Washington have withdrawn from the June 17 agreement, but this came as no surprise to market participants. President Donald Trump revoked authorization for Iranian oil exports, reinstated restrictions on Iranian shipping, while Iran once again closed the Strait of Hormuz and resumed attacks on vessels attempting to pass through it. The market failed to react either to the end of the conflict or to its renewed escalation. We did not see the anticipated decline in the U.S. dollar when geopolitical tensions eased, nor did we see the euro strengthen in response to the ECB's tighter monetary policy. The bears remain firmly in control despite the broader fundamental and geopolitical backdrop. At present, renewed geopolitical tensions merely provide them with a formal excuse for additional selling. In my view, however, traders are effectively pricing in geopolitical risks for the third time, including events that have not yet occurred.

The current chart structure continues to support the bearish impulse that began on April 17. Bearish Imbalance 17 has not yet been filled, while Imbalance 18 was invalidated by weak U.S. labor market data. No bullish patterns have formed, and none are likely to appear over the next few days given the market's lack of momentum. The bulls may continue a corrective advance toward Imbalance 17, but there is currently no compelling technical setup to trade such a move. A liquidity sweep has already occurred below the August 1 low from last year (marked by the red line on the chart), followed by a sweep above the July 2 high. These developments at least provide the bears with technical justification for maintaining pressure.

There were no notable economic releases on Wednesday. Neither the United States nor the eurozone published any meaningful data during the day, and overall trading activity remained subdued.

The bulls still have plenty of long-term reasons to regain control in 2026, and the conflict in the Middle East has not materially changed that outlook. Structurally and fundamentally, President Trump's policies—which contributed to the sharp decline of the U.S. dollar last year—remain largely unchanged. At present, I see no significant fundamental support for the dollar despite the FOMC's hawkish stance. EUR/USD is approaching a series of prominent lows and swing points where another liquidity sweep could occur, potentially signaling the end of the current bearish impulse.

Economic Calendar for the United States and the Eurozone

• Eurozone: ECB Interest Rate Decision (12:15 UTC)
• United States: Initial Jobless Claims (12:30 UTC)
• Eurozone: ECB Press Conference (12:45 UTC)

The July 23 economic calendar features two major ECB-related events. While Thursday's economic news may have only a limited impact on market sentiment, it is unlikely to generate a strong market reaction.

EUR/USD Forecast and Trading Advice

In my view, the pair remains in the process of forming a broader bullish trend. Although the fundamental backdrop shifted sharply in favor of the bears four months ago, the longer-term uptrend cannot yet be considered invalidated. The bulls may well launch another advance after liquidity is swept below the key lows. However, opening long positions at current levels is premature. It is better to wait for the formation of clear bullish patterns.

At present, traders have only Bearish Imbalance 17 as a meaningful technical reference. Liquidity has already been swept from the most recent swing points, while the fundamental case for sustained U.S. dollar strength remains questionable. Therefore, I continue to expect a bullish recovery, but it is essential to see technical confirmation before acting on that view. Alternatively, traders can wait for a fresh sell signal within Bearish Imbalance 17.

Crude oil is trading around $85.95, pulling back after encountering strong resistance around the 6/8 Murray level at $87,50. This level represents strong resistance, as it acted as strong support during April, May, and June, so the CL may now struggle to continue rising.

Crude oil may struggle to continue rising above the 6/8 Murray level, so we believe that in the coming hours, a strong technical correction toward the 5/8 Murray level around $81.25 could occur, and the instrument might even find strong support around $78.90 near the 200 EMA.

Given that the Eagle indicator on the H4 charts has reached overbought levels, we could technically look for opportunities to sell below $87.50 with initial targets around $81.25 and $78.90.

If crude oil finds strong support at the 5/8 Murray level or around the 200 EMA, we should watch this area to see if the market forms support or consolidation there, which could present an opportunity to re-enter long positions.

A break below $78.90 could accelerate the decline in crude oil, potentially reaching the $71.00 level—where a gap was left on July 9—and we could even expect the price to reach the 3/8 Murray level around $68.75.

If crude oil consolidates above $87.50 in the coming days, it could continue to rise until it fills the gap left around $95.99.

Conversely, a drop below $78.90 could send prices down until they fill the gap left around $71.38.

Bitcoin is trading around $65,891, above the 21 SMA and above the 1/8 Murray level, rebounding after reaching a high of around $66,918 during Tuesday's US trading session.

Technically, Bitcoin could continue its rise in the coming days until it reaches the 2/8 Murray line around $68,750; this zone is key as it could face strong resistance. Below this zone, a technical correction could occur, and for bears, it could be a good area to take short positions.

If Bitcoin falls below $65,625, it is likely to reach the lower band of the uptrend channel formed since early June and could eventually reach the 200 EMA around $63,900. Both levels could serve as strong support for Bitcoin and could be seen as an opportunity to resume buying.

On the other hand, if Bitcoin falls below $64,000 and consolidates below this zone, the outlook could turn negative and a trend reversal might occur. If this scenario plays out, we could expect it to reach $62,500 and eventually hit the -1/8 Murray level around $59,375.

The Eagle indicator is showing a positive signal, although there are signs of exhaustion in the upward momentum. Therefore, after a technical correction, we could wait and then resume long positions.

The FAA has officially returned to Boeing the right to self-issue airworthiness certificates for new 737 MAX and 787 Dreamliner aircraft. This decision was immediately reflected in the stock price: the aerospace giant's shares rose 1.0% in pre-market trading. It marks the end of a multiyear period of heightened regulatory oversight introduced after a series of production breaches.

Boeing obtained partial self-certification rights as early as September 2025: at that time the company and the regulator alternated in issuing certificates on a weekly basis. Over the subsequent eight months the FAA found that production quality remained comparable regardless of who issued the certificate and concluded that a full transfer of those powers to Boeing does not pose a safety risk.

FAA administrator Bryan Bedford commented on the decision: "Safety drives everything we do, and this step forward is only possible because we are confident it can be done safely."

An additional positive market signal came from FAA deputy administrator Chris Rocheleau at the Farnborough air show: certification of the 737 MAX 7 is "literally not far away," and the MAX 10 will follow soon after.

The FAA also expects to certify the Boeing 777X after approval of the two MAX variants — according to Rocheleau, that could occur either at the end of the current year or in early 2027, depending on when Boeing provides the required documentation.

Boeing's management views these steps as confirmation of progress. Stephanie Pope, CEO of Boeing Commercial Airplanes, said on the eve of the air show that the company has a very strong order book and stressed that demand is not the problem: the company's priority is to listen to customers and suppliers and to ramp up production.

The company's financial picture also gives cause for optimism. Boeing, which posted annual losses from 2018 through 2024, expects to reach positive cash flow in the second half of 2026.

Earlier this week, the company reported delivery of 314 commercial aircraft in the first half of the year — a record for the period since 2018. The expected lift from newly certified aircraft is viewed as a key element of the company's long-term target of $10 billion in free cash flow per year.

The overall US equity market backdrop remained supportive: the S&P 500 gained 0.4%, the Dow Jones rose 0.3%, and the Nasdaq advanced 0.7%, reflecting risk appetite across most sectors.

The combination of restored certification powers, senior FAA officials' comments on imminent certification of new MAX variants and record first-half deliveries creates the image of a company emerging from a turning point after years of safety and production crises.

For investors this provides a compelling reason to consider buying Boeing shares ahead of the company's second-quarter results, scheduled for release on July 28, 2026.

Nasdaq100 (NDX): the key level 29,140.0 remains the main watershed for short?term dynamics. This week the market's attention will be focused on tech giants' earnings and developments in geopolitics, which could provide new signals for the next move.

The tech index Nasdaq100 is trading with optimism on Tuesday, with futures up about 1.3% and trading near 29,050.0 and the EMA144 (1-hour chart) in the early hours of the US session. US equities are being supported by two key factors: a recovery in the semiconductor sector after the recent correction and expectations of strong earnings from tech "giants" that should confirm resilient demand for AI-related products and services.

The start of the week was mixed. On Monday, the benchmark stock indices closed lower: the Dow lost 0.59%, the S&P 500 fell 0.19%, and the Nasdaq100 dropped 0.05%. The market felt pressure from a renewed escalation of geopolitical tensions in the Middle East (the tenth night of US strikes on Iran) and higher oil prices, which raised inflation concerns and bolstered expectations for a hawkish Fed.

However, sentiment improved on Tuesday amid reports of possible peace talks (mediators proposing a 10-day truce), which eased inflation expectations. That, in turn, pushed Treasury yields lower and supported growth stocks, especially in the tech sector.

Fundamental backdrop: earnings season and geopolitics

Corporate reports: a test for the market. The most important phase of Q2 earnings season begins this week. Key results to watch come from leading tech companies including Alphabet (Google), Intel, Tesla, and IBM. Markets will scrutinize how AI spending is affecting the profitability of tech giants. Strong reports are expected to confirm resilient AI demand and justify high valuations in the sector.

Preliminary results already look encouraging. 3M and General Motors reported profits above expectations, and 3M shares jumped over 7%. The semiconductor recovery (the Philadelphia Semiconductor Index rose 2.3% on Monday and continued higher on Tuesday) is also a positive sign for Nasdaq100.

Geopolitical factor. The US–Iran conflict and Houthi threats in the Red Sea keep a geopolitical premium in oil prices. This creates inflation risks and supports expectations of sustained high interest rates, which is bearish for growth stocks—especially tech names with high multiples. However, markets have largely priced in these risks, and any signs of de-escalation could become a powerful catalyst for upside.

Brief technical analysis

Technically, Nasdaq100 retains a short-term bearish bias, but indicators point to possible consolidation or a bounce. On the 1-hour chart, the price is testing the key resistance zone at 29,050.0–29,140.0 (EMA144 and EMA200), which could cap any rebound.

The price is also trading below the 50-day EMA (29,050.0), which acts as significant resistance. However, the 200-day EMA (26,700.0) sits well below current levels, confirming the longer-term uptrend, though the corrective phase may continue.

The most likely scenario is volatile consolidation in the 28,500.0–29,200.0 range, with an attempt to break higher if corporate reports are high and geopolitical risks ease.

Key events to watch

Conclusion and recommendations for investors

The Nasdaq100 is at a decisive phase where bullish momentum from the semiconductor rebound and anticipated strong earnings meets bearish pressure from geopolitics and persistently high rates. The key level 29,140.0 remains the main dividing line for short-term dynamics. This week, the market will watch tech earnings and geopolitical developments for fresh directional cues.

For short-term traders: prioritize long positions on a break above 29,140.0 with targets 29,330.0–29,850.0. Consider short positions only on a confirmed break below 28,500.0 supported by fundamental catalysts.

For medium?term investors: take a wait-and-see stance until geopolitics and earnings clarify the picture. A correction to 28,100.0–28,500.0 could be used to add longs if tech sector fundamentals remain strong.

Risk management: remain cautious due to high volatility linked to geopolitical events and earnings. Use stop-losses and monitor developments in the Middle East and company results closely.