Markets to Watch This Week: Gold, EUR/USD, and USD/JPY

Global markets entered the final days of July on a cautious note despite progress in trade negotiations ahead of the August 1 deadline. All three major US indices closed lower on Tuesday, snapping a six-day winning streak for the S&P 500, as investors digested mixed earnings and braced for the Federal Reserve’s policy decision alongside a wave of Big Tech results—including Microsoft, Meta, Apple, and Amazon.

Defensive positioning stood out: the S&P Low Volatility Index outperformed, the VIX rose to 15.98%, US 10-year yields fell 9bps, and gold prices snapped a four-day losing streak—all pointing to a clear flight to safety.

Locally, the ASX 200 edged higher in the first two sessions of the week, led by gains in healthcare and industrials. In FX, AUD/USD tested its 50-day moving average as traders positioned ahead of Australia’s Q2 CPI release. Consensus expects trimmed mean inflation at 2.7% y/y—just above the RBA’s 2.6% forecast—potentially recalibrating rate cut expectations for the August meeting.

Gold

Gold continues to consolidate between $3,259 and $3,439 while pressing against its year-to-date ascending trendline. Repeated rejections near the upper band—highlighted by multiple arrows—signal persistent selling pressure.

Short-term momentum remains mildly constructive, supported by the 20-day EMA. However, the KDJ indicator is flattening near the midpoint, reflecting a lack of conviction. A breakout above $3,445 would open the path to $3,510, while a drop below $3,259 risks a deeper pullback toward $3,180.

EURUSD

EUR/USD remains rangebound after failing to hold above the 1.1795 resistance, now showing signs of a reversal below its rising channel. The pair is testing horizontal support near 1.1530 and faces downside risks toward 1.1509.

Price action has slipped below the 20-day EMA and is hovering near the lower channel line, suggesting weakening bullish momentum. A bearish crossover in the KDJ indicator reinforces this pressure. A clean break below 1.1500 could accelerate losses toward the next support at 1.1365.

USDJPY

USD/JPY continues to consolidate ahead of key central bank events—Fed and BoJ—both likely to set the tone. As of writing, the pair trades within a broad ascending channel but faces selling pressure from a long-term trendline near 148.59. A breakout above this level is required to confirm a bullish reversal and open the door to retesting 149+.

Alternatively, if price rejects the trendline—as suggested by the red dashed path on the chart—the neckline near 145.12 (marking a potential head-and-shoulders formation) becomes a key level for bears.

The KDJ indicator shows overbought conditions, and momentum appears to be fading. A move above 149.12 could extend toward 150.60, while failure to clear resistance puts 146.60 and lower back in play. The broader direction hinges on Fed guidance and the BoJ’s policy tone.

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