XAU/USD – Daily Chart
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Forex Signals Brief July 21: ECB, PMIs and Inflation but Focus Is on S&P 500
Last week, risk appetite remained strong in global markets, lifting major cryptocurrencies and tech stocks to new records while gold and...
Last updated: Sunday, July 20, 2025
Quick overview
- Global markets saw strong risk appetite last week, with major cryptocurrencies and tech stocks reaching new record highs.
- U.S. equity markets continued to rise, with the S&P 500 and Nasdaq hitting all-time highs despite concerns over inflation and tariffs.
- The forex market remained subdued, with the U.S. dollar finding modest support amid a stable risk environment.
- Bitcoin and Ethereum both experienced significant gains, with Bitcoin surpassing $120,000 and Ethereum breaking above key resistance levels.
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MARKETS TREND
Last week, risk appetite remained strong in global markets, lifting major cryptocurrencies and tech stocks to new records while gold and forex pairs traded in narrower ranges.
Stocks Extend Gains Despite Inflation and Tariff Noise
U.S. equity markets continued their upward march last week, with the S&P 500 and Nasdaq posting fresh all-time highs once again. The Dow Jones Industrial Average ended the week flat, yet its price action reflected a broadly optimistic sentiment that has supported risk assets for much of the past month.
Even as headlines focused on higher-than-expected June CPI inflation and the introduction of new U.S. tariffs, both markets and the Federal Reserve largely dismissed these developments. Investors seemed undeterred, encouraged instead by persistent economic resilience and steady corporate earnings expectations. The upbeat sentiment helped equities shake off any concerns about profit-taking or potential macroeconomic headwinds.
Forex Market Quiet as Dollar Finds Support
Currency markets were mostly subdued over the week. Most major forex pairs traded within tight ranges, though there was a modest bid for the U.S. dollar. The dollar’s strength was partially supported by ongoing yield differentials and a generally stable risk environment.
Stocks Finish at All-Time Highs
The major US stock indices delivered another strong performance last week, closing at new record highs in the case of the S&P 500 and Nasdaq. Dow Jones Industrial Average dipped eaelry in the week but rebounded and despite ending unchanged it reflected optimism that has broadly lifted risk assets in recent weeks. Investors shrugged off tariff headlines and profit-taking fears as market momentum remained firmly positive.
Adding to this backdrop, markets digested news of new US tariffs, and higher CPI inflation numbers for June, however markets ad the FED brushed them off . Despite these potential headwinds, equity markets were firmly higher, indicating that traders continue to bet on robust economic resilience and steady earnings growth.
Sunday (Jul 21)
Japan Upper House Election
Investors will monitor the results for potential shifts in domestic policy outlook, especially as the Bank of Japan’s ultra-loose stance remains under pressure.
Monday (Jul 22)
- PBoC Loan Prime Rate (LPR) Decision
- Canada Producer Price Index (June)
- U.S. Leading Economic Index (June)
- New Zealand Trade Balance (June)
Tuesday (Jul 23)
- UK Public Sector Net Borrowing (June)
- U.S. Richmond Fed Manufacturing Index (July)
Wednesday (Jul 24)
- Eurozone Consumer Confidence Flash (July): Sentiment across the bloc remains fragile. A downside surprise could weigh on EUR if growth expectations weaken further.
Thursday (Jul 25)
- ECB Policy Announcement: While rates are expected to remain unchanged, markets will focus on President Lagarde’s tone regarding inflation persistence and policy path.
- Turkish Central Bank (CBRT) Policy Decision: With inflation still elevated, traders await any signs of further monetary tightening or a pause.
Flash PMIs for July:
- Eurozone, UK, U.S.
- U.S. Weekly Jobless Claims
- Canada Retail Sales (May)
Friday (Jul 26)
- UK Retail Sales (June)
- UK GfK Consumer Confidence (July)
- Japan CPI (July)
- Germany Ifo Business Climate (July)
- U.S. Durable Goods Orders (June)
Last week, markets were slower than what we’ve seen in recent months, with gold retreating and then bouncing to finish the week unchanged. EUR/USD slipped toward 1.16, while S&P and Nasdaq continued 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.
Gold Pulls Back Slightly but Holds Key Support
After a historic surge earlier in the year that saw prices approach $3,500/oz, gold has entered a more uncertain phase. Although geopolitical risks and inflation worries remain, gold prices have failed to maintain upward momentum in recent weeks.
The precious metal recently bounced off its 20-week SMA near $3,150, which remains a closely watched support level. However, lackluster buying activity suggests traders are becoming more cautious, as rate cut expectations shift and the U.S. dollar holds its ground. Gold bulls are watching for a clearer direction before committing to new positions.
Yen Slides as USD/JPY Pushes Above the 100 Weekly SMA
USD/JPY was a notable mover, climbing above the 148 mark as Japanese capital continued to flow abroad. The move also brought the pair above the critical 100-week simple moving average (green), a level that has previously acted as strong resistance. Traders are watching closely to see if a sustained breakout above this level materializes, which may require a shift in monetary policy expectations or broader changes in investor sentiment.
USD/JPY – Weekly Chart
Cryptocurrency Update
Bitcoin Prints New Record High Above $120K
Cryptocurrencies maintained their bullish momentum, with Bitcoin reaching a new all-time high above $113,000 before a minor pullback. Earlier in the week, Bitcoin had dropped below its 50-day moving average and briefly dipped under $100,000—the first such move since early May. However, strong buying support at the 20-week SMA fueled a sharp rebound that drove the price back above $120,000.
BTC/USD – Weekly chart
Ethereum Breaks Above Resistance
Ethereum’s performance has been even more impressive. It has now gained over 20% since April, outperforming Bitcoin in relative terms. Institutional interest has surged again, driven in part by anticipation surrounding Ethereum’s upcoming Pectra update, which aims to further enhance the platform’s scalability and functionality.
Crucially, Ethereum has broken above its 100-week moving average—an important technical milestone for traders. This breakout has opened the path toward the $4,000 zone, reinforcing its appeal among investors seeking targeted blockchain exposure.
ETH/USD – Daily Chart
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ABOUT THE AUTHOR
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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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