The USD is strengthening in early US trading. Here’s a quick look at yields: the 2-year yield has decreased by 1.7 basis points to 4.024%, the 10-year is steady at 4.509%, and the 30-year has increased by 2 basis points to 4.983%. US and Chinese representatives are meeting in London to discuss boosting the availability of rare-earth elements for US manufacturers. Meanwhile, US stock indices show slight gains. In premarket trading, the Dow is up by 34 points, the Nasdaq by 15 points, and the S&P by 7.5 points. The EURUSD is on a downward trend after reaching a high of 1.1439 earlier in Europe. During the US session, it fell below the 100-hour moving average of 1.14094, eyeing the 200-hour average at 1.13814, indicating a potential bearish shift. The current price sits at 1.1394. GBPUSD has dipped below the 100-hour moving average and is only 0.08% higher for the day. The 100-hour moving average is at 1.35459, while the 200-hour average is at 1.3518, which could be the next target if bearish momentum continues. USDCAD is trying to rise above the 100-hour moving average at 1.36868, a key level since May 26. Staying above this point may lead to targeting Friday’s high of 1.37032 and the 200-hour moving average at 1.37315. This update highlights a slight strengthening of the US dollar as New York trading starts. Yields are showing mixed signals: the 2-year yields have dipped, suggesting lower expectations for immediate rate hikes. The 10-year remains unchanged, indicating that markets are taking a moment to assess medium-term inflation and monetary policy. Meanwhile, the 30-year yield is rising, hinting at higher expectations for long-term growth or government borrowing costs. In conjunction with these moves, US indexes show minor upward momentum ahead of the opening bell. Gains are modest, but consistent, across large-cap, tech-heavy, and broad-market benchmarks. This suggests a cautious optimism among equities, possibly influenced by global trade talks or upcoming earnings. On the EURUSD front, it continues its downward trend. After reaching a session high earlier, it has now fallen below the important 100-hour moving average. This drop puts the 200-hour average in focus, a level traders often watch to gauge medium-term sentiment. Since the price now sits between these markers, further weakness is possible. A small movement could push it through that lower average, confirming downward pressure. Similarly, GBPUSD is following a comparable trend. It has fallen below its own 100-hour average and is approaching the 200-hour marker. Although daily changes remain slightly positive, the trend since the London session has been negative. This gradual decline suggests waning buying interest and potential downward pressure. If it fails to hold at this level, it could drop toward the next moving average, which often triggers short-term positioning. On the other hand, USDCAD is trying to gain upward momentum. After testing its 100-hour average, it aims to establish support above this line, near a significant market peak from late May. If it maintains this momentum, short-term charts suggest a focus on last week’s highs and the 200-hour average just above. There’s potential here, provided it remains convincingly above the average being tested. For traders focused on volatility or options, this environment provides clear levels to work with. Several currency pairs are near critical hourly mean reversion zones, creating opportunities for defined entries and exits. Recent movements highlight the importance of considering time-specific averages on intraday charts rather than broader moving averages, which haven’t indicated a strong directional bias yet. Finally, it’s important to consider the bigger picture. Although market reactions have been calm, ongoing negotiations between two major economies about industrial materials could lead to demand-driven shifts in specific sectors and currencies. While spot market reactions may seem muted now, forward-thinking participants should factor in these developments for future positions, especially concerning inflation-sensitive assets. As US yields rise more assertively at the long end without significant shifts across the curve, this signals that the market expects long-term economic stability rather than a reevaluation of short-term monetary policy. This distinction is crucial in shaping expectations about whether early-week trading will hold or fade.

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