Dollar regains ground post-Fed – BoE poised to hold steady
Market sentiment: Traders weigh hawkish Fed tone vs geopolitical risks
The Federal Reserve held interest rates steady, as widely expected, but Chair Jerome Powell struck a more hawkish tone during the press conference. This renewed demand for the US dollar, despite falling Treasury yields.
Meanwhile, comments from former President Trump suggesting a potential “deal with Iran” helped ease geopolitical tensions, triggering a pullback in gold and oil from recent highs. US markets remain closed today in observance of Independence Day.
Key events to watch today
United Kingdom
- Bank of England Rate Decision – Expected: Hold at 4.25%.
Inflation remains elevated, but slowing growth keeps the door open for potential rate cuts later this year.
Eurozone
- Construction Output Index
Speeches from Lagarde, Buch, and de Guindos – Market to monitor for post-Fed policy cues.
Australia
- Labor Market Data – A key input for future RBA policy direction.
Japan
- Weekly Foreign Bond Investment figures
Currency market overview
EUR/USD
- Slipped to 1.1460 under dollar pressure.
- ECB commentary today could influence short-term direction.
Support: 1.1440.
Resistance: 1.1500.
GBP/USD
- Trading below 1.3400 amid policy uncertainty.
- BoE rate decision in focus today.
Support: 1.3360.
Resistance: 1.3450.
USD/JPY
- Pulled back to 144.30 after a 3-day rally.
Support: 143.80.
Resistance: 145.00.
AUD/USD
- Holding gains above 0.6500 ahead of labor data.
Support: 0.6470.
Resistance: 0.6540.
Commodities and metals
Gold (XAU/USD)
- Fell to $3360/oz as dollar strength and Iran de-escalation hopes weigh.
Support: 3350.
Resistance: 3405.
Silver (XAG/USD)
- Spiked above 37.00 before sharply retreating to 36.60
Range: 36.10 – 37.20.
Crude Oil (WTI)
- Dropped to $71.00 after Tuesday’s surge.
- EIA data offered mixed signals on supply trends.
Support: 70.00.
Resistance: 73.50.
Trading recommendations
Buy Gold near $3355–3365.
- Target: 3410.
- Stop-Loss: 3340.
- Comment: Bullish bias remains as long as geopolitical tensions persist.
Sell GBP/USD on failure to break above 1.3450 post-BoE.
- Target: 1.3350
- Stop-Loss: 1.3480
Buy AUD/USD on daily close above 0.6540
- Target: 0.6620
- Comment: Trade depends on the strength of labor market data.
Stay neutral on Oil
- Await breakout above 73.50 or breakdown below 70.00 to define directional bias.
Market summary
Markets are entering a repositioning phase post-Fed, with the dollar regaining dominance but without strong momentum amid persistent geopolitical risk.
All eyes now turn to the Bank of England, where policymakers are likely to hold rates steady as they navigate the tricky balance between sticky inflation and sluggish growth.
Until clearer direction emerges, markets remain fragile and highly reactive to political developments rather than pure macro data – making risk management the top priority for traders.
Author
Ahmed Alsajadi
Independent Analyst
Ahmed Al-Sajjady is a professional economic and market analyst with over five years of experience in macroeconomic forecasting and institutional trading methods (SMC/ICT).
