Weekly Forex Outlook – July 13th – July 19th (Charts)

I wrote this on the 6th. Here’s a rundown of the best deals from the week:

1. Long on the EUR/USD currency pair, which dipped by 0.70%.
2. Long on the Nasdaq 100 index, which increased by 0.12% over the week.
3. Long on the S&P 500 index, showing a 0.11% rise for the week.
4. Silver in USD after the daily (New York) exceeded $37.13, which wasn’t established until the weekend.
5. DLTR with a long position after the daily (New York) went beyond $109, also not set until the weekend.

The overall loss was about 0.47%, translating to a 0.09% decrease per asset.

Last week, news revolved around ongoing speculation regarding the new tariffs imposed by Trump on various countries, following a postponed deadline until August. He made several announcements about tariffs:

1. A 50% tariff on all copper imports, which pushed copper futures to new highs, definitely catching the attention of trend and momentum traders.
2. Another 50% tariff on imports from Brazil, a move that complicates Brazil’s strong position within BRICS and impacts American foreign policy.
3. Additional 10% tariffs on all countries considered to align with BRICS.

These decisions probably helped bolster the US dollar, which performed unusually well against the Brazilian Rial last week. Still, the two major US equity indices—the Broad S&P 500 Index mainly focused on tech—couldn’t sustain momentum.

There were other influences during the week related to significant data releases:

1. The RBA Cash Rates and Statement—there were expectations for a cut of 0.25%, but surprisingly, the cash rate remained unchanged. This created expectations for rate cuts in August, with the Aussie performing well overall.
2. The RBNZ also decided to maintain interest rates as expected.
3. The UK’s GDP was anticipated to show a positive trend, but it instead revealed a decline, indicating more pessimism for the UK economy.
4. US unemployment claims came in slightly better than expected.
5. Canada’s unemployment rate was expected to rise to 7.1%, but unexpectedly fell to 6.9%, although it still sits higher than the US rate.

Over the weekend, Trump announced that Mexico and the EU would face 30% tariffs on exports to the US starting August 1st. This news will likely impact the stock market at the start of the week, possibly strengthening the dollar while weakening the euro and Mexican peso.

Next week seems fairly light on significant data releases, but the CPI (inflation) updates, especially from the US, will be crucial as they serve as key drivers for the forex market.

Important data points to watch include:

1. US CPI (Inflation)
2. US PPI
3. Retail Sales in the US
4. UK CPI (Inflation)
5. Canada’s CPI (Inflation)
6. US unemployment claims
7. Australia’s unemployment rate

In July 2025, there was an expectation for the EUR/USD currency pair to rise. Here’s how that prediction has been performing so far:

Last week, the AUD/JPY forex pair experienced an unusual spike, so I expect it to decline in value this week. The Australian dollar emerged as the strongest major currency last week, while the Japanese yen lagged. Volatility surged, with 41% of pairs showing significant changes in value. I expect this volatility to continue or possibly increase next week.

These predictions can be executed through your forex brokerage account, whether it’s real or demo.

The US Dollar Index mirrored the action of last week’s candlesticks, closing near the week’s peak, signaling bullishness. However, it’s essential to note two apparent bearish signs:

1. The dollar has been on a long-term bearish trend.
2. Last week’s peak values didn’t reach major resistance levels indicated in the price list.

The market is hopeful the Fed might implement three more interest rate cuts this year, but recent comments suggest only three cuts are planned. This could push the dollar to new long-term lows once the tariffs phase out.

The Nasdaq 100 index experienced slight changes despite nearing a new all-time high. The weekly candlestick was indecisive, suggesting uncertainty, which could signal reduced momentum, leading to a bearish outlook.

While I generally avoid shorting US stock indices, if the Nasdaq closes at 22,945 daily, it might prompt me to consider a long position.

The S&P 500 index followed a similar path to the Nasdaq. My comments regarding the tech index also apply here. Notably, this broader index may experience a more significant impact from the recent tariffs.

The EUR/USD currency pair formed downward candlesticks last week, although it’s generally in a long-term bullish trend. However, the new 30% tariff on EU imports announced over the weekend introduces some caution. I’m hesitant to engage in new trades unless we see daily values exceed $1.1806 again.

AUD/JPY posted strong bullish candles with significant real bodies, emerging as the top performer in forex last week, propelled by expectations of interest rate cuts from the Reserve Bank. Meanwhile, the yen remains weak as the Bank of Japan has yet to show readiness for substantive profit margins.

Prices have risen significantly, and I believe a minor short position might be prudent, as I expect a decline this week. Additionally, the price failed to break resistance levels by week’s end.

The USD/MXN currency pair displayed small upward candles but with considerable upper wicks, indicating more bearish sentiment. The week’s low coincided with significant support levels, so this could indicate temporary support that won’t hold.

With the announcement of a new 30% tariff on Mexican imports, the peso is expected to weaken against the dollar, suggesting a short transaction could be beneficial. Waiting for daily prices to drop below $15.5776 before entering a short position would be wise.

Silver performed better than gold and remained within reach of its recent highs, reinforcing my bullish outlook. I had a strong bullish breakout towards the end of last week, reaching $38.50 per ounce, suggesting this bullish trend is well-established since 2023.

Palladium, being a rarer metal, is showing high volatility and continues to rise, especially last Friday when it hit new highs. Though futures prices may be steep for retail traders, affordable ETFs are available for trading. I consider joining the long trend when the market opens Monday.

Copper has seen increasing prices for a while, demonstrating a bullish trend. However, the recent 50% tariff on copper imports has driven prices to unprecedented levels. The real question is how much momentum this news will generate.

As a trend trader, I’ve already taken a long position here. A bearish trend was observed last Friday, so it may be wise to enter a new long trade if the New York closing price exceeds $5.6855.

Here are the best deals for the week:

1. Long on the EUR/USD currency pair if it closes above $1.1806.
2. Long on the Nasdaq 100 index if it closes over 22,945.
3. Long on the S&P 500 index upon closure exceeding 6,283.6.
4. Long on copper futures following daily closures above $5.6855.
5. Long on silver priced in USD.
6. Long on palladium priced in USD.
7. Long on the AUD/JPY currency cross.