The dollar is mostly stable, as key currencies show little movement. The EUR/USD is at about 1.1680, below important moving averages, showing a bearish trend but with limited selling pressure. If it breaks below 1.1650, attention may turn to retracement levels. The USD/JPY is steady at 147.33, trying to build on recent gains, facing resistance around 148.00. Support is near the 100-day moving average at 145.79. Meanwhile, GBP/USD has slipped 0.2% to 1.3473, and USD/CAD remains steady at 1.3683. AUD/USD and NZD/USD have dropped by 0.2% and 0.4% to 0.6565 and 0.5985, respectively, reflecting cautious market sentiment. U.S. futures are recovering slightly, with S&P 500 futures down just 0.3%, after being down 0.6% earlier. European markets have also reduced some losses, with the DAX currently down 0.6% after falling over 1% at its lows. Traders are closely watching U.S. economic data, as the upcoming CPI report will impact expectations for the Federal Reserve’s meetings in July and September. Analysts predict June’s core inflation at 3.0%, up from May’s 2.8%. Currently, traders estimate about a 93% chance of no rate change in July and a 67% chance of a 25 basis point cut in September. Market activity appears cautious, and this is reflected in the recent price movements. The euro is experiencing some pressure against the dollar, and a dip below 1.1650 could shift focus to earlier Fibonacci levels, although the gap between current prices and that potential change is narrow. The overall apprehension stems from a lack of strong economic triggers, especially ahead of significant data releases. Sellers are being cautious, and without new catalysts, sustained momentum is uncertain. The dollar’s status against the yen indicates attempts to maintain recent highs rather than making significant gains. Resistance just below 148 has caught attention before, and if this area is approached again, price behavior could provide valuable insights. Support is well established near 145.80, defining the current price range. While prices are near the upper limit, they have not threatened a breakout. For the pound, its slight dip aligns with a cautious market stance. There isn’t a strong force pushing it lower, but there’s also no clear drive to return to the higher levels seen earlier this month. The Canadian dollar is flat, while the Australian and New Zealand dollars are both dipping, reacting more to global sentiment than local factors. Even a slight risk aversion tends to impact commodity-linked currencies more immediately. In equities, an earlier significant drop has turned into a minor pullback by the time U.S. markets open. For instance, the DAX has recovered more than half its morning losses. A notable shift seemed unlikely as the broader yields remained unchanged. S&P futures, still slightly down, reflect a more balanced sentiment, suggesting current market mood is fluctuating rather than declining sharply. Regarding the macro perspective, inflation is the main focus for traders right now. The next U.S. inflation report is expected to show an increase in core readings, which could either disappoint or reassure investors, depending on the outcome. Speculative positioning suggests that a hold in July is almost certain, but the situation for September is less clear. If inflation rises, the anticipated 25-basis-point cut in late Q3 could be questioned. Our outlook sees the market’s reaction to new data as crucial for assessing how reliant traders are on easier policy. If inflation surprises on the upside, even slightly, the rates market may quickly shift back toward neutral expectations. We’ve seen this sensitivity in the past. Current pricing creates a narrow pathway for easing later this year, but this pathway isn’t particularly wide, meaning any delays in expectations could have a larger impact. Currently, it’s the gaps between data releases that set the market tone, rather than a single headline. Volatility is low, and daily trading ranges are tight for most major pairs. However, traders who are too reliant on this calm might be caught off guard when the next batch of CPI figures starts to influence the market again. There’s limited room for dovish interpretations if core inflationary pressures remain persistent or increase. For now, we are monitoring whether markets will hold their recent ranges. While price threats have not yet emerged, any move outside immediate technical boundaries could quickly lead to shifts in positioning, especially in corporate hedging and medium-term volatility pricing. This is particularly significant in tighter liquidity conditions, where reactions can be exaggerated.

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