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The NZDUSD pushed to its highest level since June 5 yesterday, but the rally lost momentum and reversed lower, leading to a corrective move that has now reached an important technical support zone. The pair is currently testing its 200-hour moving average at 0.5819 while also holding near the 50% retracement of the May 29 high to the June 26 low at 0.5809. Today's low reached 0.5812 before attracting some buying interest, suggesting this area is being closely defended.

From a technical perspective, buyers need to reclaim the 200-hour moving average and then push back above the 100-hour moving average at 0.5839. The 100-hour MA was broken during yesterday's reversal after the rally to new highs stalled, coinciding with renewed U.S. dollar…

Microsoft continues to emphasize that AI adoption is accelerating at what they call an "incredible pace", with demand spreading across cloud infrastructure, AI applications, and enterprise software. The company says customer demand remains ahead of available capacity, prompting continued investment in data centers and AI hardware.  They said that the capabilities are becoming accessible across all customer segments and that fiscal year 2027 partner addressable AI total addressable market exceeds US dollar $1.3 billion.

Here are the main takeaways's:

• AI adoption is accelerating, not slowing. Microsoft is seeing adoption pick up speed, suggesting businesses are moving beyond pilots and into broader deployment.
• AI is becoming democratized. The…

Microsoft continues to emphasize that AI adoption is accelerating at what they call an "incredible pace", with demand spreading across cloud infrastructure, AI applications, and enterprise software. The company says customer demand remains ahead of available capacity, prompting continued investment in data centers and AI hardware.  They said that the capabilities are becoming accessible across all customer segments and that fiscal year 2027 partner addressable AI total addressable market exceeds US dollar $1.3 billion.

Here are the main takeaways's:

• AI adoption is accelerating, not slowing. Microsoft is seeing adoption pick up speed, suggesting businesses are moving beyond pilots and into broader deployment.
• AI is becoming democratized. The…

U.S. Trade Representative Jamieson Greer, testifying before the Senate Finance Committee, outlined the administration's priorities for trade negotiations, emphasizing continued progress on USMCA talks, stronger North American manufacturing incentives, and a pragmatic approach to negotiations with Mexico, Canada, and China.

• U.S. is on the way to becoming an agricultural trade surplus nation again.
• We are moving with all due speed on USMCA negotiations.
• We want USMCA rules of origin to be very strong to incentivize production in North America.
• We hope to reach interim arrangements with Canada and Mexico before the end of the year.
• Some issues, including rules of origin, labor, and environmental provisions, may take longer to resolve and…

• Crude oil inventory +2.01 million versus -1.052 million estimate
• Gasoline inventories +0.765 million versus -1.5 .7 million estimate.
• Distillates +1.395 million versus +0.738 million estimate.

Surprise build in the oil inventory data for the current week versus expectations, but the private data last night also showed a surprise build of 2.603M for crude and a build up 1.75 million for distilates.

The price of crude oil is trading at $87.07. That is still up $2.70 on the day. However, the price is off the high price of $88.61. Support is at the 50% midpoint of the move down from the May 18 high.

The USDCHF is consolidating in choppy trading today, but continues to hold support within a key swing area between 0.81079 and 0.81195 (see red circles and yellow area on the chart above). The session low reached 0.8114, comfortably within that support zone, while the high extended to 0.8133, falling just short of the next upside target at 0.81392, a resistance level defined by the June 24 swing high. Above that, the July 14 high at 0.81509 remains the next key upside objective (high for the year).

Recall that on Monday the pair broke above its near-converged 100- and 200-hour moving averages (blue and green lines on the chart above), a technical development that shifted the bias back in favor of the buyers. Since that breakout, the price…

Trump will apparently be available to reporters today. He is saying:

• Iran will pay a big price.
• They will not have a nuclear weapon. 
• Americans are not against the war. 
• Soldiers tests are under investigation. Iran will be held accountable
• Americans do not want higher gas prices.

Looking around the markets.  Yields are ticking modestly to the upside with the two-year up 2.19 basis points at 4.282%. The 10 year is up 1.2 basis points at 4.640%. Later today, the US treasury will auction off 20 year bonds

The major US indices are mixed which is a relief from the lower levels in premarket trading

• Dow industrial average of 240 points or 0.46%:
• S&P index up 2.52 points or 0.03%
• NASDAQ index -62 points or -0.24%

The NASDAQ index was down 250 points in…

The USDCAD moved sharply higher earlier this week, supported by renewed trade tensions after the U.S. announced 50% tariffs on selected Canadian goods. The tariff headlines gave the U.S. dollar a boost against the Canadian dollar, helping the pair recover from the week's lows and shifting the short-term technical picture back in favor of buyers.

That upside momentum culminated yesterday when the pair climbed above its 200-hour moving average (green line on the chart below) for the first time since July 8. Reclaiming that key technical level was an important development, signaling that buyers were beginning to regain control after spending nearly two weeks below the longer-term intraday trend gauge. The rally then extended toward an…

Pres. Trump is posting on TruthSocial:

"From this point forward, any time the Islamic Republic of Iran shoots at a ship in the Strait of Hormuz, whether it be by Missile, Rocket, Drone, or any other device or weapon, the United States will bomb and destroy ONE BRIDGE OR POWER PLANT, including those located next to, or in, the Capital City of Tehran. Thank you for your attention to this matter! President DONALD J. TRUMP"

Geopolitical tensions in the Middle East remain elevated. Earlier, Iran reiterated that it controls the Strait of Hormuz, while the Islamic Revolutionary Guard Corps (IRGC) warned that if U.S. attacks continue, it is prepared to launch a "regret-inducing operation," further escalating the war of words. Shipping risks also…

The US dollar is little changed to start the North American session, with all of the major currency pairs trading within 0.15% of unchanged. Looking at the three most actively traded pairs—EURUSD, USDJPY, and GBPUSD—price action has been similarly subdued, with each pair moving less than 0.7% from yesterday's close.

The USDJPY remains the standout after reaching a fresh 40-year high of 163.238 yesterday, extending above the previous July 1 high at 162.833. During Asian trading today, the pair briefly dipped to 162.80, but buyers quickly stepped back in, pushing the price back above the 163.00 level. It currently trades near 163.04, keeping the bullish trend firmly intact.

The EURUSD has been confined to a narrow 19-pip trading range today…

Headlines:

• Red Sea shipping disruption now in focus as vessels are forced to change course
• Iran says it struck US military facilities in Jordan and Bahrain
• Oil prices extend gains as disruptions in the Strait of Hormuz and the Red Sea worsen the supply outlook
• US futures nudge lower on the day, eyes on big tech earnings
• USD/JPY stays in focus after run to fresh 40-year high
• Gold analysis today as bulls are staging a major bullish reversal from yesterday
• BoJ officials see recent Yen weakness as upside inflation risk, open to raising rates faster
• UK inflation eases slightly in June but core prices keep steady

Markets:

• WTI crude up 3.5% to $87.30
• European indices hold higher; DAX up 0.3%
• S&P 500 futures down 0.3%, Nasdaq futures down 0.9%
• CAD leads, NZD…

FUNDAMENTAL OVERVIEW

Oil prices remain supported amid the ongoing US-Iran conflict as both sides continue to exchange strikes and the Strait of Hormuz remains in a de facto closure. In addition to that, we now have shipping disruptions in the Red Sea as well after the Houthis announced a naval blockade on Saudi Arabia on Monday.

Despite the military escalation, diplomatic efforts to restore a ceasefire continue. Reuters reported that mediators have floated proposals aimed at reviving negotiations between Tehran and Washington.

There’s not much to add on the fundamental side as the price action continues to be driven by US-Iran headlines. As long as the crisis persists, oil prices will…