Forex Signals Brief July 3: Dollar Wobbles Ahead of NFP; Swiss CPI in Focus

Quick overview

Currency markets were lively today as traders weighed weak US jobs signals, looming NFP data, and Swiss inflation trends.

US Dollar Falters After Early Strength

The US dollar started European trading on the front foot yesterday but quickly gave up its gains before the close. The reversal was triggered in part by a weaker-than-expected ADP employment report, which raised concerns about Thursday’s non-farm payrolls (NFP) release.

Adding to the pressure was news of a second US trade deal, this time with Vietnam. While the deal details remain sparse, President Trump hinted at terms allowing 20% US tariffs even as Vietnam expands market access. Although this isn’t inherently dollar-negative, markets speculate it may serve as a blueprint for tougher trade stances with larger partners—fueling uncertainty about broader trade relations.

Political Gridlock and Budget Drama in Washington

Investors were also watching developments in Washington, where House fiscal hawks delayed votes on budget measures, contributing to market jitters about near-term US fiscal stability. Meanwhile, the risk environment improved overall, buoyed by news from the Dallas Fed that suggested further reductions in US oil rig counts—a supply-side signal that helped boost oil prices.

Stocks Advance Despite Policy Concerns

US equities shook off the early gloom to finish firmly higher. After a flat start, the major indices gained as investors leaned back into risk. The tech-heavy Nasdaq and broader S&P 500 both closed at record highs for a third consecutive day, signaling strong demand for growth stocks. Small caps joined in too, with the Russell 2000 outperforming thanks to rotation into cyclical sectors.

In Europe, the UK gilt market grabbed attention as yields spiked sharply. The move followed the UK government’s sudden reversal on planned welfare spending cuts, coupled with drama surrounding Chancellor Reeves. The resulting budget worries triggered a 130-pip collapse in GBP/USD, though about half the losses were later clawed back—a volatile session that left traders wary of further UK fiscal twists.

Today’s Market Events

Swiss CPI Data Under the Microscope

Markets are also keeping a close eye on Swiss inflation data. Following May’s negative -0.1% year-on-year reading, which largely reflected cheaper energy and tourism shifts, there’s renewed speculation about whether inflation might rebound slightly in June.

The Swiss National Bank (SNB) cut rates by 25 basis points in June to 0.00%, citing softer inflation expectations and lowering its Q2 projection to 0.0% from 0.3%. However, given recent upside surprises in energy costs and hotter CPI prints in France and Spain, there’s room for a positive surprise that could challenge the SNB’s dovish stance.

US Non-Farm Payrolls on Thursday

Due to the Independence Day holiday, the highly anticipated US non-farm payrolls report will be released Thursday instead of the usual Friday. Markets are bracing for a potentially pivotal print: consensus expects 129,000 new jobs in June, down from 139,000 in May and below both the 3-month average (135,000) and 6-month average (157,000).

While the unemployment rate is expected to hold at 4.2%, the Fed still forecasts it will rise to 4.5% by year-end. Wage growth is also under scrutiny, with average hourly earnings expected to slow to +0.3% month-over-month from +0.4% previously. Investors see these figures as critical inputs for gauging the Fed’s near-term rate path.

Last week, markets were slower than what we’ve seen in recent months, with gold retreating as a result, the EUR/USD jumping above 1.18 but returned back below it, while S&P and Nasdaq retreated yesterday, but Dow Jones kept pushing higher. The moves weren’t too big though, and we opened 35 trading signals in total, finishing the week with 23 winning signals and 12 losing ones.

The 20 Daily SMA Turns Into Resistance for Gold?

Gold has returned higher again after its spectacular April rally to an all-time high near $3,500 per ounce. Prices have reversed sharply, breaking below the key 50-day simple moving average that had held for nearly a year. Traders are now watching the 100-day SMA around $3,150 as the next crucial support, with the recent slide signaling a loss of bullish momentum and raising the risk of deeper declines, but this week buyers are back.

USD/JPY: Resistance Holds Despite Yield Chasing

USD/JPY – Weekly Chart

Cryptocurrency Update

Bitcoin Buyers Return

Bitcoin also saw selling earlier in the week, slipping below both the $104,000 level and its 50-day moving average to dip under $100,000 for the first time since early May. Yet long-term investors stepped in quickly: buyers defended the 20-week SMA, sparking a $10,000 rebound that left BTC trading closer to $108,000 by week’s end.

BTC/USD – Weekly chart

Ethereum Tests the 200 Weekly SMA Again

Ethereum (ETH) has outshone Bitcoin in recent weeks, rallying over 20% since April on institutional buying and excitement over the Pectra upgrade. The technical focus is now the 200-day moving average. A breakout above this level could open the path toward $4,000—potentially allowing ETH to outperform BTC through the summer.

ETH/USD – Daily Chart

ABOUT THE AUTHOR See More

Skerdian Meta

Lead Analyst

Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.

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