We're well into July, so the summer vibes have already started. I don't mean just the heat, the forex market has already entered summer mode. 

Forex traders are not as aggressive at this time of the year, particularly in August, since most of the big cats in the industry leave their trading desks for exotic places. Anyone leaving for the Maldives or Bali? 

Besides that, today is Monday, so the forex market seems to be half asleep. All forex pairs are barely moving, with the USD/JPY being one of the most volatile, climbing a massive … 30 pips. 

We know that during this time, liquidity dries up. Even central banks don't schedule or announce anything really important during July and August. 

The market is usually pretty quiet during these 7-8 summer weeks, but don't rule out breakouts; they can be very brutal when liquidity is thin. If there is no one on the other side of the trade then there's no one to reverse the price. 

Well, there is always someone on the other side of a trade in forex, but as we said, liquidity is thin, so we must be careful. Short-term signals/trades are the safest bet right now.