Market Analysis Summary: US Dollar Attempts a Rise
Author: Elior Manier
Date: July 10, 2025
Overview
The forex markets are currently experiencing a period of low volatility, with major currency pairs trading within a narrow range of 300 pips. However, the US Dollar (USD) is attempting a rally following a positive report on jobless claims, which may introduce some volatility into the market.
Jobless Claims Report
The latest Weekly Jobless Claims report showed a figure of 227,000, which is better than the expected 235,000. This indicates continued strength in the US employment sector, despite a temporary rise in claims observed in mid-June.
Tariff Announcements
Recent tariff news includes a controversial decision to impose 50% tariffs on copper imports and similar tariffs on goods from Brazil. Analysts question the effectiveness of these tariffs in boosting US industrial production, as they may lead to increased costs for imports.
US Dollar Index Analysis
The US Dollar Index (DXY) is showing signs of breaking out from a descending channel, forming a bullish divergence with recent lows. This shift in momentum is significant as it may indicate a potential trend reversal, especially with US economic data consistently surprising to the upside.
DXY 4H Chart
Market Dynamics
There has been a notable imbalance in short positioning against the USD, which has become less appealing as the dollar index has declined. The recent positive economic data has delayed discussions regarding potential cuts by the Federal Reserve, leading to speculation about future monetary policy.
Key Levels to Watch
Traders should monitor the following levels:
- Support Zones:
- Current Range Lows: 97.20
- Consolidation Support: 97.00
- 2025 Lows: 96.50
- Resistance Zones:
- Immediate Pivot: 97.60 to 97.80
- Current Resistance: 98.00
- Main Resistance: 99.20 to 99.40
Conclusion
The US Dollar's recent movements suggest a potential shift in market dynamics, with traders keenly awaiting the upcoming US Consumer Price Index (CPI) report. The interplay between economic data and market sentiment will be crucial in determining the direction of the USD in the near term.