Forex News
- Dow Jones futures rise while oil prices fell after President Trump announced a pause on strikes against Iran.
- Iranian officials refuted negotiating claims and kept forces on high alert, leaving geopolitical risks elevated.
- Investors await major corporate earnings and Friday's monthly US jobs report to gauge economic health.
Dow Jones futures gain 0.54% to trade around 52,920 during European trading hours on Monday. Meanwhile, S&P 500 futures rise 0.49% to trade near 7,550, while Nasdaq 100 futures advance 0.64%, trading near 28,590.
US stock futures rise as oil prices declined on easing supply risks, driven by prospective diplomatic progress between Washington and Tehran. Sentiment shifted after US President Donald Trump announced a pause on planned military strikes. In a post on Truth Social, President Trump stated that Iran and regional partners had requested time to negotiate a deal aimed at fully reopening the Strait of Hormuz and resolving concerns over Iran's nuclear program.
However, financial markets maintained a cautious stance as Iranian officials quickly refuted Washington’s characterization of the situation. Reporting via Iran’s Mehr news agency, officials dismissed the claim that Tehran requested a pause as "nothing but a new lie". They reiterated that Iranian military forces remain on high alert and prepared for any scenario, leaving geopolitical uncertainty elevated across global markets.
Meanwhile, investors await another wave of corporate earnings that could provide fresh clues on the strength of the economy and serve as new catalysts for the artificial intelligence trade. Major companies set to report this week include Berkshire Hathaway, Eli Lilly, and Walt Disney, among others, including tech firms such as Palantir and SpaceX. Traders will also monitor a packed schedule of labor market data, highlighted by Friday's closely watched monthly US jobs report.
Ai volatility tempers broader US equity gains
Strategists at Deutsche Bank note that US equities posted "a solid gain in aggregate," with the S&P 500 advancing " +1.05% (+0.70% Friday)." However, they emphasise that the standout theme was "continued volatility around the AI trade," as the Philly semiconductor index "ended the week -4.30% lower despite a +8.19% spike on Thursday." The bank also highlights a mixed performance within the Mag-7, which were " +4.16%" on the week overall, with "Microsoft (+21.75%) and Amazon (+17.00%) surging after their earnings, but Apple (-7.24%) and Meta (-6.47%) losing ground after theirs."
Barkin flags a close call on rates, keeping Dollar bulls cautious
Barkin’s speech scored 6.2/10 on the FXS Speechtracker, modestly above the 5.4/10 historical average, signaling a slightly more impactful tone relative to the established baseline. The “close call” remark on whether rates are high enough, combined with uncertainty about joining recent hike dissents and skepticism on meaningful labor market strengthening, points to a nuanced stance that stops short of clearly endorsing further tightening. Comments on uneven price increases suggest persistent, but patchy, inflation pressures that may limit aggressive Dollar repricing in the near term.
The FXS Fed Sentiment Index slipped by 0.46 points to 148.24, indicating a mild pullback in perceived hawkishness despite remaining firmly above the neutral 100 mark. This keeps the Fed narrative in hawkish territory, but the incremental softening versus prior readings may temper the upside for the Dollar as markets reassess the probability of additional rate hikes.
Dow Jones FAQs
The Dow Jones Industrial Average, one of the oldest stock market indices in the world, is compiled of the 30 most traded stocks in the US. The index is price-weighted rather than weighted by capitalization. It is calculated by summing the prices of the constituent stocks and dividing them by a factor, currently 0.152. The index was founded by Charles Dow, who also founded the Wall Street Journal. In later years it has been criticized for not being broadly representative enough because it only tracks 30 conglomerates, unlike broader indices such as the S&P 500.
Many different factors drive the Dow Jones Industrial Average (DJIA). The aggregate performance of the component companies revealed in quarterly company earnings reports is the main one. US and global macroeconomic data also contributes as it impacts on investor sentiment. The level of interest rates, set by the Federal Reserve (Fed), also influences the DJIA as it affects the cost of credit, on which many corporations are heavily reliant. Therefore, inflation can be a major driver as well as other metrics which impact the Fed decisions.
Dow Theory is a method for identifying the primary trend of the stock market developed by Charles Dow. A key step is to compare the direction of the Dow Jones Industrial Average (DJIA) and the Dow Jones Transportation Average (DJTA) and only follow trends where both are moving in the same direction. Volume is a confirmatory criteria. The theory uses elements of peak and trough analysis. Dow’s theory posits three trend phases: accumulation, when smart money starts buying or selling; public participation, when the wider public joins in; and distribution, when the smart money exits.
There are a number of ways to trade the DJIA. One is to use ETFs which allow investors to trade the DJIA as a single security, rather than having to buy shares in all 30 constituent companies. A leading example is the SPDR Dow Jones Industrial Average ETF (DIA). DJIA futures contracts enable traders to speculate on the future value of the index and Options provide the right, but not the obligation, to buy or sell the index at a predetermined price in the future. Mutual funds enable investors to buy a share of a diversified portfolio of DJIA stocks thus providing exposure to the overall index.
Commerzbank analyst Michael Pfister examines recent joint US–Japan intervention to support the Japanese Yen. He notes confirmation that US authorities helped Japan and that further actions are possible, but constrained by IMF rules. Pfister argues the Yen is heavily undervalued, explores motives linked to US Treasuries and JGBs, and warns markets to brace for additional interventions.
US–Japan action and yen valuation
"This morning, official confirmation finally arrived that the US had lent Japan a hand with its interventions to strengthen the yen for the first time in many years, something that had been clear since Friday at the latest. Officials have emphasised that they are ready to carry out further interventions, although Thursday's intervention alone is estimated to have been the largest single-day intervention to date."
"The yen has been significantly undervalued for many years. According to OECD purchasing power parity, it is currently more than 60% undervalued against the US dollar. By way of comparison, the euro is undervalued by about 29%."
"I suspect that the US was more concerned that US Treasuries might be sold off. Japan could have sold them to prop up the yen with the US dollars received, which would tie in with reports that Japan might make greater use of the Fed’s repo facility (i.e. deposit USTs there as collateral in exchange for cash)."
"However, if Japan intervenes again in the coming days, the Ministry of Finance will have effectively used up all its options until November in order to retain that status."
"Until then, market participants should brace themselves for possible interventions later in today's trading session."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
- The Japanese Yen trades higher against its peers amid fears that the US and Japan could intervene again.
- The US and Japan jointly intervened on Friday to prop up the Yen.
- Hawkish BoE prospects have diminished after last week's monetary policy announcement.
The Japanese Yen (JPY) trades sharply higher against its major currency peers during the European trading session on Monday. The Japanese currency is up 0.6% at around 211.00 against the British Pound (GBP) even after giving back a majority of its early gains amid fears that the United States (US) and Japan could jointly intervene again to counter excessive volatility and disorderly movements in the Japanese Yen.
Japanese Yen Price Today
The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the British Pound.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.02% | 0.13% | -0.44% | 0.14% | 0.06% | 0.02% | 0.11% | |
| EUR | 0.02% | 0.14% | -0.47% | 0.16% | 0.06% | 0.08% | 0.09% | |
| GBP | -0.13% | -0.14% | -0.59% | -0.01% | -0.08% | -0.06% | -0.03% | |
| JPY | 0.44% | 0.47% | 0.59% | 0.52% | 0.42% | 0.46% | 0.44% | |
| CAD | -0.14% | -0.16% | 0.01% | -0.52% | -0.09% | -0.06% | -0.08% | |
| AUD | -0.06% | -0.06% | 0.08% | -0.42% | 0.09% | 0.01% | 0.06% | |
| NZD | -0.02% | -0.08% | 0.06% | -0.46% | 0.06% | -0.01% | 0.04% | |
| CHF | -0.11% | -0.09% | 0.03% | -0.44% | 0.08% | -0.06% | -0.04% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).
Earlier in the day, Japan's Finance Minister (FM) Satsuki Katayama said that Japan “won't hesitate to carry out more forex intervention with US”. She also confirmed a joint intervention with Washington on Friday. “Conducted coordinated yen-buying intervention with US on Friday,” Katayama said.
On Sunday, US President Donald Trump also said Washington helped Japan prop up the JPY as a sign of friendship and to help the world economy, Reuters reported.
Japan’s intervention to support the Yen was highly anticipated as the currency fell to its historic low at around 219.61 against the British Pound, and to near 164.00 against the US Dollar (USD) in July.
Meanwhile, the British Pound trades lower against its peers as traders reconsider Bank of England (BoE) interest rate hike expectations.
BoE repricing seen as a headwind for Pound
Brown Brothers Harriman’s Elias Haddad argues that UK rate expectations may need to be marked lower, warning that “we see scope for a downward adjustment to UK rate expectations which is a headwind for GBP.” He notes that, despite this view, the current market still prices in further tightening, with “the swaps curve [implying] 50bps of tightening to 4.35% in the next twelve months.”
The reasoning behind traders dialing back hawkish BoE expectations appears to be remarks from Governor Andrew Bailey in the press conference, which signaled that he didn't want the public to perceive the central bank as being biased in favor of rate hikes. "Please do not leave this room thinking that the Bank of England is edging towards a hike, because frankly, there’s nothing in what I said, and I think any of us have said, along those lines," Bailey said. Reuters report.
In the policy meeting, the BoE decided to leave interest rates unchanged at 3.75%, as expected, and signaled that the central bank remains vigilant to second-round inflation effects.
Economic Indicator
BoE Interest Rate Decision
The Bank of England (BoE) announces its interest rate decision at the end of its eight scheduled meetings per year. If the BoE is hawkish about the inflationary outlook of the economy and raises interest rates it is usually bullish for the Pound Sterling (GBP). Likewise, if the BoE adopts a dovish view on the UK economy and keeps interest rates unchanged, or cuts them, it is seen as bearish for GBP.
Read more.Last release: Thu Jul 30, 2026 11:00
Frequency: Irregular
Actual: 3.75%
Consensus: 3.75%
Previous: 3.75%
Source: Bank of England
- WTI opens with a bearish gap on Monday after Trump cancelled massive strikes against Iran.
- The optimism over the reopening of the Strait of Hormuz further weighs on the commodity.
- The OPEC+ decision to raise production from September backs the case for further losses.
West Texas Intermediate (WTI) – the benchmark US Crude Oil price – struggles to register any meaningful recovery and sticks to heavy intraday losses through the early part of the European session on Monday. The commodity currently trades below mid-$78.00s, down nearly 8.00% for the day, amid renewed optimism over a potential US-Iran deal.
In fact, US President Donald Trump claimed that Mideast allies have reached the parameters of a deal on Iran's nuclear program and the full reopening of the Strait of Hormuz after calling off a massive planned attack over the weekend. Trump further told reporters that the US and Iran are set to resume negotiations Monday afternoon, fueling optimism over a diplomatic resolution to end the five-month-old war and triggering a steep decline in crude oil prices.
Meanwhile, the OPEC+ decided on Sunday to raise production quotas by about 188,000 barrels per day from September. This marks a complete unwinding of the voluntary output cuts introduced in 2023, which is seen as another factor exerting downward pressure on the black liquid. Traders, however, seem hesitant to place aggressive bearish bets on crude oil prices and opt to wait for further developments surrounding the Middle East crisis.
Analysts at Danske Bank note that in commodities, "OPEC+ approved an oil production quota increase of around 188,000 barrels per day from September, completing the rollback of a 1.65 million barrels per day cut from 2023." They point out that, despite these "successive monthly hikes over most of the year," the broader "market impact has been limited due to export disruptions caused by the Iran and Ukraine wars," tempering the effect of the formal supply restoration on overall pricing and sentiment.
The aforementioned fundamental backdrop suggests that the recent goodish recovery from a multi-month low, set in July, has run out of steam and backs the case for a further near-term depreciating move. Hence, any attempted move up is more likely to be sold into and remain limited.
WTI Oil FAQs
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
- Joint US-Japan Yen intervention spending reached $70-80 billion, pressuring the US Dollar against major peers.
- De-escalation signals between Washington and Tehran eased risk aversion, further dampening Greenback demand.
- Geopolitical uncertainty persists as Iranian officials denied requesting a pause, keeping financial markets on guard.
The US Dollar Index (DXY), which measures the value of the US Dollar (USD) against six major currencies, is losing ground after three days of gains and trading around 101.50 during the Asian session on Tuesday.
Dollar resilience persists despite joint US-Japan intervention and softer oil
ING’s Chris Turner argues that, “in theory, the Dollar should be broadly weaker today” after US and Japanese authorities confirmed joint FX intervention and with Japan “probably having sold $70-80 billion over the last three days.” He adds that lower oil prices ought also to be weighing on the Dollar, following reports from US President Donald Trump that “negotiation, rather than military firepower, is Washington's preferred method of engaging with Iran.” Yet, as Turner notes elsewhere, the Dollar’s broader performance remains surprisingly firm, underscoring how ongoing expectations for a Fed rate hike continue to offset what would normally be clear headwinds for the currency.
Adding to the Dollar's downward pressure was a temporary relief in market risk aversion driven by prospective diplomatic progress between Washington and Tehran. Sentiment shifted after US President Donald Trump announced a pause on planned military strikes. In a post on Truth Social, President Trump stated that Iran and regional partners had requested time to negotiate a deal aimed at fully reopening the Strait of Hormuz and resolving concerns over Iran's nuclear program.
However, financial markets maintained a cautious stance as Iranian officials quickly refuted Washington’s characterization of the situation. Reporting via Iran’s Mehr news agency, officials dismissed the claim that Tehran requested a pause as "nothing but a new lie". They reiterated that Iranian military forces remain on high alert and prepared for any scenario, leaving geopolitical uncertainty elevated across global markets.
Barkin’s “close call” on rates keeps Fed tone cautiously hawkish
Fed’s Barkin delivered a cautiously hawkish message on Friday, with an FXS Speechtracker score of 6.2/10, modestly above the 5.4/10 historical average and signaling slightly stronger-than-usual concern on policy tightness. Calling it a “close call” on whether rates are high enough, expressing uncertainty about joining recent hike dissents, and skepticism that the labor market has strengthened all point meaningfully to a Fed still open to further tightening if inflation proves sticky. Barkin’s comment that price increases are moving unevenly through the economy underscores an environment where the Dollar remains supported by lingering policy-hike optionality, even if conviction is not absolute relative to the established baseline.
The FXS Fed Sentiment Index slipped by 0.46 points to 148.24, indicating a mild pullback in hawkish intensity despite remaining firmly above the neutral 100 mark. This configuration suggests that, while the overall Fed stance tracked by the FXS Speechtracker stays clearly hawkish, the latest communication reflects slightly less aggressive tightening bias, rather than a shift toward dovish territory.
United Overseas Bank’s (UOB) Quek Ser Leang highlights GBP/USD’s volatile session, with a spike from 1.3401 to 1.3481 and scope for further gains toward 1.3520, though overbought conditions may cap upside. For the next 1–3 weeks, he sees strong momentum but questions whether the pair can break and hold above 1.3555, with support around 1.3385.
Upside momentum tempered by overbought
"24-HOUR VIEW: GBP traded in a relatively volatile manner last Friday, dropping to a low of 1.3401 before rising sharply to close at 1.3481 (+0.13%). While the sharp rise has scope to extend, overbought conditions could limit any gains to a test of 1.3520. The major resistance at 1.3555 is not expected to come into view. Support is at 1.3450; a breach of 1.3425 would indicate that the current upward pressure has eased."
"1-3 WEEKS VIEW: GBP broke above the significant resistance at 1.3400 last week and soared to 1.3494. While strong momentum suggests further upside, it remains to be seen whether GBP can break and hold above the next significant resistance at 1.3555. To sustain the momentum, GBP must hold above the ‘strong support’ level, currently at 1.3385"
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
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