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United Overseas Bank’s (UOB) Quek Ser Leang notes USD/SGD is stuck in a tight range after recent sideways trading, with intraday action expected between 1.2900 and 1.2930. On a 1–3 week horizon, the bank still sees downside risks if 1.2860 breaks, while 1.2930 remains strong resistance. On a 1–3 month view, support is highlighted near 1.2805.

Dollar-Singapore Dollar holds tight range

"24-HOUR VIEW: Following last Thursday’s price action, we highlighted on Friday that USD “appears to have entered a range-trading phase between 1.2890 and 1.2920.” USD subsequently traded within a range of 1.2897/1.2921 before closing little changed at 1.2920 (+0.09%). The price action provides no fresh clues. Today, USD could trade in a range between 1.2900 and 1.2930."

"1-3 WEEKS VIEW: Our most recent narrative was from last Thursday (16 Jul, spot at 1.2885), when we indicated that “downward momentum is starting to build, and should USD close below 1.2860, it could trigger a deeper decline.” Since then, USD has traded mostly in a range, and the build-up in momentum is starting to fade. However, we will maintain our view for now as long as 1.2930 (no change in ‘strong resistance’ level) is not breached."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

• Mexican Peso rallies despite stronger US Dollar and geopolitical tensions.
• Reuters poll signals slower Mexican growth through 2027.
• USMCA uncertainty and sticky inflation keep Peso risks alive.

The Mexican Peso gains some ground versus the Greenback on Monday, up by 0.66% as risk appetite improves despite escalating tensions in the Middle East. At the time of writing, the USD/MXN trades at 17.43 after hitting a daily high of 17.55

USD/MXN falls as EM demand offsets Middle East risk

Geopolitics are driving financial markets, though in the foreign exchange markets, emerging-market currencies are posting solid gains despite overall US Dollar strength. The US Dollar Index (DXY), which tracks the buck’s value against a basket of six currencies, gains 0.19% at 100.94.

A Reuters poll found that the Mexican economy is expected to grow more slowly than analysts forecast. For 2026, Mexico’s Gross Domestic Product (GDP) would expand by 1.1% and 1.8% for 2027, according to a median of 32 economists surveyed last week.

Uncertainty about the USMCA trade agreement has increased after Washington opposed a 16-year extension, opting for a 10-year term with annual reviews. Regarding inflation, it is expected to remain unchanged at 4% in 2026 and at 3.8% in 2027.

Over the weekend, tensions rose as the US and Iran exchanged strikes. Yemen's Iran-aligned Houthis announced a naval blockade on Saudi Arabia on Monday, potentially opening a new front against the US in the war.

USD/MXN Price Forecast: Technical outlook

In the daily chart, USD/MXN trades at 17.4295, hovering just above the clustered simple moving averages (SMA) around 17.3906, which offer an initial layer of support and help keep the broader bias neutral for now. The pair has recently lifted off this base but remains capped beneath a descending resistance line derived from the secondary trend, last intersecting price action near 17.5456, while the Relative Strength Index (RSI) at 48.9000 stays close to the midline, hinting at a lack of directional conviction.

On the topside, a sustained break above the nearby trend-line barrier around 17.5456 would open the door toward the higher, longer-term descending resistance line, which currently comes in closer to 18.1200. On the downside, a slip back under the SMA cluster at roughly 17.3900 would expose a deeper correction, turning the recent bounce into a false start within the broader consolidation profile.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Here is what you need to know for Tuesday, July 21:

The US Dollar Index (DXY) rises around 0.2% toward 101.00 as higher United States (US) Treasury yields and escalating tensions in the Middle East support the Greenback. The benchmark 10-year Treasury yield advances toward 4.60% as higher energy prices revive concerns that inflation could remain elevated. However, cooler recent US inflation figures have reduced expectations of a Federal Reserve (Fed) rate increase in July, limiting the US Dollar’s advance.

The United States and Iran continued exchanging attacks, while Yemen’s Iran-aligned Ansar Allah announced a naval blockade against Saudi Arabia. The developments increased concerns about Gulf and Red Sea shipping, global energy supplies and regional water infrastructure. Diplomatic contacts remain active, although no concrete ceasefire agreement has been announced.

EUR/USD falls around 0.2% toward 1.1410 as broad US Dollar demand weighs on the Euro. On Tuesday, investors will monitor the European Central Bank’s Bank Lending Survey and the ZEW indicators. German Economic Sentiment is expected to improve to 18 from 10.5, while the Current Situation measure is forecast to rise to -77.8 from -81. Eurozone Economic Sentiment for July is expected at 11.5, up from 9.5. ECB policymaker Joachim Nagel is also scheduled to speak.

GBP/USD declines around 0.1% toward 1.3430. The Pound struggles against the stronger Greenback as investors await a busy UK labor market report. Average Earnings Excluding Bonuses are expected to remain at 3.4% in the three months to May, while earnings including bonuses are forecast to rise to 4.5% from 4.4%. The Claimant Count is expected to increase by 28.3K in June, compared with 31.2K previously, while the ILO Unemployment Rate is forecast to rise to 5.0% from 4.9%.

USD/JPY edges around 0.1% higher toward 162.50 as rising US yields keep the Japanese Yen under pressure. Japan’s June trade report will be released during Tuesday’s Asian session. Exports are expected to rise 18.6% YoY, accelerating from 16.8%, while imports are forecast to increase 21.0% after the previous 12.5% gain. The total trade deficit is expected to narrow to ¥120 billion from ¥391.8 billion.

AUD/USD rises around 0.2% toward 0.7000 despite the stronger US Dollar. The Australian Dollar remains supported after the People’s Bank of China kept its one-year and five-year Loan Prime Rates unchanged at 3.00% and 3.50%, respectively. The widely expected decision maintained stable financing conditions in Australia’s largest trading partner.

USD/CAD advances around 0.3% toward 1.4070 as softer Canadian inflation weighs on the Canadian Dollar. Canada’s Consumer Price Index fell 0.4% MoM in June, compared with expectations for a 0.2% decline, while annual inflation slowed to 2.8% from 3.2%, below the 2.9% forecast. The figures reduced expectations of further Bank of Canada tightening and outweighed support from higher crude prices.

West Texas Intermediate (WTI) Oil gained around 0.6% toward $83.00 per barrel. Prices benefit from concerns that the widening US-Iran conflict and Ansar Allah's threat against Saudi shipping could cause further disruptions to global Oil flows. Hopes for renewed diplomatic negotiations are preventing a larger advance.

Gold falls around 0.2% toward $4,008 per troy ounce. The precious metal receives some support from geopolitical uncertainty, but the stronger US Dollar and rising Treasury yields increase the opportunity cost of holding non-yielding Bullion.

Attention during the US session will turn to the preliminary ADP Employment Change four-week average. No market forecast is currently available, while the previous reading stood at 19.75K. A weaker figure could reinforce signs of cooling private hiring and weigh on the Greenback, while an improvement may support US yields and the Dollar.

• WTI Crude Oil trades just above the $82.00 handle after a late-session surge tested $83.00, reversing a slide that ran from just above $84.00 to just short of $79.50.
• President Trump vowed revenge on Iran in a late-day Truth Social post, pledging retribution several times over for every American killed, after Iranian strikes killed two US soldiers in Jordan.
• A halved Gulf export stream and a four-decade-low Strategic Petroleum Reserve leave no supply cushion, so threat headlines carry all the convexity.

Crude Oil compressed its entire 2026 personality into a single Monday tape. The barrel faded from just above $84.00 through the European morning, flushed the stops to just short of $79.50 around midday, and then repriced the war in minutes when President Trump vowed revenge on Iran, a late-session bid that punched through $82.00 and tested the $83.00 handle before easing back to just above $82.00.

The peace trade, minus the peace

Monday's slide ran against a backdrop that offered nothing to justify it. Washington has strung together nine consecutive nights of strikes on the capabilities Iran uses against Strait of Hormuz shipping, the Islamic Revolutionary Guard Corps spent the weekend targeting tankers on the southern route off Oman, and fighter squadrons are being pulled from Europe toward the region while ground-assault chatter builds in both capitals. The barrel sold all of it anyway, bleeding lower from the opening hours.

What the morning did offer was noise that read, if squinted at, like de-escalation. The Secretary of State spent the weekend insisting the diplomatic door remains open, the White House shelved its floated 20% transit fee on Hormuz cargo, and US-backed work on reviving an Iraq-to-Syria pipeline sketched the outline of a world routing around the strait. Sunday's roughly 3% pop had also left longs with profits to book into thin summer liquidity.

Five months of serial ceasefires built the reflex that did the rest: every prior lull taught traders the premium decays faster than the war ends, so the tape now fades headlines it has seen before. That reflex ran to its logical extreme around midday, a two-candle flush through the $80.00 handle that printed just short of $79.50 and snapped back above $81.00 within minutes, a stop-run that found nobody willing to press the low.

The revenge repricing

The reversal needed exactly one input, and it arrived deep in the North American afternoon: President Trump vowed revenge on Iran in a Truth Social post, pledging that Tehran would repay every American death several times over and confirming the directive had already gone to his commanders, after Iranian strikes killed two US soldiers in Jordan. The bid was immediate, punching through $82.00 to a test of the $83.00 handle, nearly $2.00 of war premium rebuilt inside two hours.

The asymmetry between the two moves is the story worth keeping. The morning needed five hours, nine ignored nights of strikes, and a stop-run to drag the barrel roughly $4.50 lower, while a single post clawed back close to half of it before most desks had read it twice. The two-way market the textbooks promise shows up only on the way down, and even there it needed a stop-run to look convincing.

Washington then restated the asymmetry in real time: Central Command announced a fresh round of strikes at 20:00 GMT, directed by the Commander in Chief and aimed at the same Hormuz shipping-attack capabilities the previous nine rounds targeted, and the barrel barely blinked. An administration still advertising an open diplomatic door is now launching its tenth consecutive night of ordnance; the announced strike is priced, and only the threatened one moves spot.

The sequence also rhymes with early July, when the third ceasefire break landed a day after the sell side surrendered to the peace trade, the Energy Information Administration slashing its third-quarter Brent forecast by $27.00 and Saudi Arabia cutting official selling prices by the most in two decades. The lesson keeps getting retaught: this market punishes anyone who prices the war away, and Monday ran the whole script in miniature.

No cushion, no symmetry

The reason one post can move spot nearly $2.00 lives in the physical market rather than the feed. Gulf exports have run at roughly half their pre-war rate for months, around 7 million barrels per day against a long-run reference near 20 million, tanker traffic through the strait sits hostage to Iranian discretion, and the Strategic Petroleum Reserve holds about 319.5 million barrels, its lowest level since 1983.

Against that backdrop the tape's manic behaviour is close to rational. Fading the premium earns a few Dollars slowly and with the crowd, while being short the wrong headline in a market with no spare barrels costs double digits instantly, so the fades trade thin and the threats trade thick. Until Hormuz flows normalize or the reserve rebuilds, Crude Oil remains a market where the President's feed prints the marginal barrel.

Crude Oil technical levels

Resistance: The $83.00 handle is the immediate cap, the level the revenge bid tested and could not clear on the first attempt. Beyond it sits the $84.00 area, home to the session high printed in the early hours, and then the $85.00 handle as the first objective of escalation that arrives by missile rather than by post.

Support: Initial demand sits at the $82.00 handle, backed by the $81.00 to $81.50 congestion that absorbed the entire afternoon. Below that, the $80.00 handle guards the midday extreme just short of $79.50, a low the market has already rejected emphatically once today.

Bias: Bullish. The flush found no sellers willing to press below $80.00, the rebound needed nothing more than a post, and the 5-minute Stochastic Relative Strength Index has cooled toward oversold while the tape holds above $82.00, consolidation rather than reversal. Only a break back below the $81.00 area, unwinding the entire revenge bid, hands the session back to the peace trade.

WTI Crude Oil spot, 5-minute chart

MUFG’s Lloyd Chan highlights that higher Oil prices and persistent inflation risks are weighing on Asian currencies, with the Indian Rupee (INR) and Thai Baht (THB) underperforming against the US Dollar. The Baht looks particularly vulnerable due to Thailand’s deteriorating external balance and current account deficits, while the softer US Dollar Index (DXY) has not prevented renewed downside pressure on these currencies.

Oil-sensitive Asian FX under pressure

"Across Asia, the Indian rupee (INR) and Thai baht (THB) were the worst-performing currencies last week, each depreciating by around 1% against the US dollar. The weakness was particularly notable given the somewhat softer DXY, underscoring their heightened sensitivity to the rebound in oil prices. For the baht, risks remain skewed to the downside, especially with the deterioration in Thailand’s external balance."

"Inflation risks remain skewed to the upside amid escalating geopolitical tensions in the Middle East. Brent crude prices have rebounded to around USD88/bbl as geopolitical risk premia rise and tanker traffic through the Strait of Hormuz declines. As a result, US gasoline prices remain elevated relative to pre-conflict levels."

"While US Treasury yields have eased following softer June CPI and PPI releases, they remain above 4%. The University of Michigan survey showed that 1-year consumer inflation expectations moderated to 4.2%yoy in July from 4.6% previously, but remain elevated. Longer-term inflation expectations (5-10 years) stayed at 3.3%."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Societe Generale’s Michael Haigh and Jeremy Sellem highlight that Brent has surged as US-Iran tensions, Trump’s rhetoric and Houthi blockade threats lift risk premia. Crack spreads in Asia and US have outperformed as refined products stay tighter than crude. Tanker data show crude dominating Strait of Hormuz flows, while LNG traffic lags badly, reinforcing a crude-centric recovery.

Crude-led rebound and tighter products

"The front month Brent contract is up 12% this week, with most of the rebound occurring on Monday and Tuesday following the resumption of strikes by both the US and Iran. Additional support came after Donald Trump reiterated his intention to launch record strikes against military targets, alongside a short-lived proposal for US fees to cover the cost of providing safe passage to commercial vessels. Today, more risks developed with the Houthi’s stating that they would impose a maritime blockade on Saudi Arabia in response to what the group says is Saudi Arabia’s siege on the Yemini capital, Sana’a."

"Oil prices initially rallied toward $91/bbl on the news, but subsequently retreated, suggesting the market remains relatively complacent about the potential threat to regional energy flows."

"Crack spreads have strengthened across the board, rising 22% in Asia and 12% in the US, consistent with greater concern in Asia over the impact of prolonged disruptions to flows through the SoH and the resulting risk of product shortages."

"Although the latest reports suggest that inventories increased by 21 million barrels in June, the majority, if not all, of this build appears to have been in crude oil rather than refined products."

"Our analysis suggests that crude oil now accounts for nearly 80% of Hormuz transit volumes, around five percentage points higher than before the conflict."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Deutsche Bank strategists analyses China’s AI (Artificial intelligence) ecosystem, noting that Chinese models are rapidly catching up in capability while being priced near mid-tier US systems. They argue that open-weight Chinese models could accelerate global AI adoption but pressure United States (US) AI capex returns and margins. Recent Chinese releases have already weighed on AI and semiconductor stocks and may hasten commoditisation.

Open-weight Chinese models disrupt AI economics

"Geopolitical fears also interacted with fresh concerns around the AI trade, which meant that equities took a hit around the world. That was particularly clear for chip stocks, with the Philly semiconductor index down -9.97% last week (-1.63% Friday), marking its biggest weekly decline since the week of the Liberation Day tariff announcements last year."

"The micro implications are as important as some Chinese models are being priced at levels broadly comparable to mid-tier US models (e.g. Anthropic Sonnet), despite performance that approaches higher-end systems, implying a materially lower cost-to-intelligence ratio."

"A key differentiator is approach: Chinese models are increasingly released as open-weight systems, allowing developers and enterprises to download, modify and run them locally, whereas US leaders have largely pursued closed, proprietary models delivered via APIs."

"The immediate market reaction—pressure on AI and semiconductor names—reflects a reassessment of whether the industry’s current capex trajectory is sustainable if similar performance can be delivered more cheaply."

"At the macro level, this could encourage faster, wider and cheaper adoption of AI which will be more positive for productivity. However, it also raises the risk of a capex overcycle in the US if returns on AI infrastructure come under pressure, while also intensifying geopolitical fragmentation as competing technology stacks evolve."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

• US-Iran hostilities lift WTI, reviving inflation and Fed risks.
• Ten-year yields climb as markets price year-end hike odds.
• Fed blackout leaves jobs data and PMIs as catalysts.

Gold price edges down some 0.19% on Monday as hostilities between the US and Iran extended, following a short-lived truce that began after both countries agreed to a ceasefire, which was broken nine days ago. At the time of writing, XAU/USD trades at $4,011.

XAU/USD slips as rising Oil, yields and Dollar pressure Bullion

The escalation of the Middle East conflict is weighing on Gold prices amid high energy prices, sparked by fears of a disruption in Oil supplies. The US attacked military targets for the ninth straight day near the Strait of Hormuz, while Iran hit US military assets in Gulf states.  At the same time, Ansar Allah, an Iran-linked political/military organisation, declared a naval blockade on Saudi Arabia.

On the news, Crude prices, namely US benchmark West Texas Intermediate (WTI) trimmed some of its earlier losses, shifted positive and is up 0.33%, at $82.05 per barrel. Consequently, the US 10-year Treasury yield — which inversely correlates with Gold — is up nearly five basis points to 4.598%, a headwind for the yellow metal.

The US Dollar Index (DXY), which tracks the American Dollar’s value against six currencies, is up 0.19% at 100.94.

Last week, the Federal Reserve’s (Fed) Vice Chair, Philip Jefferson, said he is open to raising rates if there is no progress toward disinflation. On Friday, Cleveland Fed President Beth Hammack expressed concern about persistent high inflation, emphasising that “inflation is too high." She noted the labour market is solid, with good growth and stable consumer spending.

Money markets are pricing 82% odds of an interest rate hike by year-end, yet for the July meeting there is a nearly 79% chance of holding rates unchanged.

Next week, the US economic docket will feature jobs data and S&P Global Flash PMIs as Fedofficials entered their blackout period ahead of the July 29 policy meeting.

XAU/USD technical outlook: Gold price remains bearish, eyes on $3,900

Gold remains downwardly biased with price action respecting the ongoing successive series of lower highs and lower lows. Also, momentum remains tilted downward as depicted by the Relative Strength Index (RSI), which is bearish.

For a bearish continuation, XAU/USD must drop below the July 17 low of the day (LOD) at $3,959. A breach of the latter will expose the $3,900 psychological level, ahead of the October 28, 2025 mark at $3,886. 

To reverse upward, Bullion must break a descending trendline between $4,125 and $4,175. Success could target the 50-day Simple Moving Average (SMA) at $4,291, with the 200-day SMA at $4,495 as the next hurdle. Surpassing this could lead to $4,500.

TD Securities’ commodity strategy team highlights that, after a five‑week reduction in Copper longs, speculators have resumed adding net length, supported by firm Chinese premiums, low arrivals and inventory draws on the LME and SHFE. While these factors could underpin further length additions, expectations of more Fed tightening may prompt quick position trimming if Copper fails to extend recent gains.

Tight physical market supports cautious length

"After a five-week unwind in copper longs, speculators returned to adding net length, with long exposure slightly outpacing new shorts."

"Physical conditions remained supportive, with premiums in China continuing to firm, as low arrivals and inventory draws across the LME and SHFE tightened metal availability."

"Middle East tensions kept supply risks in focus, although a softer CPI print helped ease macro pressures."

"These factors could support further additions to copper length, although expectations for further Fed tightening have yet to dissipate and specs may be quick to trim exposure if copper struggles to extend recent gains."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)