Barclays Research highlights the expected flows from this month-end rebalancing.

"Our passive month-end rebalancing model shows weak USD buying against most majors, and moderate against the CAD and GBP," Barclays notes.

"Overall, the marginal underperformance in US equity and bond markets dominates our month- end model due to the large market cap and induces a weak dollar-buying signal against most majors Canada and the UK are an exception, as the signal points to moderate USD buying, driven by the outperformance of equities in these countries," Barclays adds.

(Adds latest price shift after spot drop and adds link to line 5)

• Benchmark 1-month expiry USD/JPY FX option implied volatility was sold at 5.8 on Thursday

• That's an ever new low for the contract since February 2022. 5.0 was post pandemic low from Sept 2021

• However, when compared with realised volatility over the last 1-month - 5.0 is the current fair value measure

• That's up from 3.85, but a repeat of the past months realised volatility still wouldn't cover the premium

• 1-month implied vol has since been paid at 6.15 after latest USD/JPY drop sub 163.00

• A short gamma driven surge above 164.00 barriers might reignite vol demand, especially if it leads to intervention

• Markets aren't expecting Friday's BoJ to fuel volatility - according to overnight expiry FX option pricing

• FX options eye September Fed reload
USD/JPY 1-month implied volatility


(Richard Pace is a Reuters market analyst. The views expressed are his own)

• EUR/USD up from 1.1375 to 1.1475 EBS on Wednesday

• High matches the peak of the 20-day Bollinger bands

• Dip to 1.1435 on Thursday followed by rise top 1.1465

• Traders were betting $6billion on euro dropping

• Short squeeze lifting euro after Fed held US int/rate

• Close over 55-DMA, daily cloud base 1.1495/90 risks bigger rise

• Crowded dollar longs leave currency vulnerable to further unwinding

•
EURUSD


(Jeremy Boulton is a Reuters market analyst. The views expressed are his own)

July 30 (Reuters) - EUR/GBP's nine-month downtrend showed signs of capitulation in July, with price accelerating from 0.8617 to 0.8455 (LSEG data) before staging a notable recovery towards month-end. The velocity of the move is itself instructive - a blow-off acceleration of this nature often marks trend exhaustion rather than continuation, particularly when it coincides with a failed break of key structural support.

That's precisely what occurred here. The sell-off briefly violated the 200-month moving average, which has underpinned price since June 2025, before price rejected the break and reclaimed the average. A false break of a level this significant is a textbook bullish reversal signal, and the technical bias shifts constructively for the euro as long as monthly closes hold above the average.

Compounding this, price action has printed a hammer on the monthly candle - small real body, negligible upper wick, and a long lower shadow extending well below the open. The pattern reflects a clear intra-month shift in order flow: aggressive selling into the lows was absorbed, with buyers driving price back toward the open by the close. Taken together with the false break, this adds weight to a near-term bottoming thesis.

Confirmation remains outstanding, though. A monthly close near July's lows would negate the hammer, hand control back to sellers, and likely reopen downside risk below 0.8455. Conversely, a close that preserves the hammer's structure keeps the 100-month moving average at 0.8658 in view as the next upside objective.

Key levels to watch into month-end: hold above the 200-MMA and a constructive close are prerequisites for the bullish scenario to gain traction; failure to do so undermines the reversal setup entirely.
EUR/GBP Monthly Chart:


(Peter Stoneham is a Reuters market analyst. The views expressed are his own)

• The FX volatility upon which options thrive is unknown, so implied volatility becomes its proxy

• Overnight FX option expiries now include Friday's BoJ policy decision so their implied volatility is telling

• Overnight expiry USD/JPY implied volatility reached 15.0 before Wed's Fed - double the recent average

• However, it's since dropped back to 10.0 - so around 2.5 above the recent average - low FX risk premium for BoJ

• Premium/break-even at 10.0 vol is 68 JPY pips in either direction vs 51 JPY pips at 7.5 (102 JPY pips at 15.0)

• Broader FX option implied volatility has dropped back to prior 2026 lows after paring Wed's Fed risk premium
Overnight expiry USD/JPY FXO implied volatility


(Richard Pace is a Reuters market analyst. The views expressed are his own)

(amends link to short position story )

• EUR/USD jumps to 1.1470 after Fed hold and reaches 1.1475 Thursday

• EUR/USD traders established a short position toward the bottom

• The rally faltered ahead Jul 15 peak at 1.1482

• Pair peaked after it reached top of 20-day Bollinger Bands

• Oil has jumped after more fighting in Middle East weighing EUR/USD

• Yuan strength, euro resilience may redefine what is a safe currency

• Resilience of EUR/USD support sets stage for 1.2165

•
EUR/USD


(Jeremy Boulton is a Reuters market analyst. The views expressed are his own)

• Cable falls to 1.3334 as safe-haven USD strengthens on higher oil prices

• Oil up on war news: U.S. military says it hit dozens of Iran's IRGC targets

• 1.3334 is low since 1.3385 high following Fed rate hold on Wednesday

• Pre-Fed low was 1.3280. 30-year UST yield up to 19-year high in Asia

• BoE is expected to keep its policy rate at 3.75% at 1100 GMT

• U.S. June core PCE data due at 1230 GMT; 0.2% MM, 3.3% YY forecast

GBPUSD


(Robert Howard is a Reuters market analyst. The views expressed are his own)

• FX option strikes expire at 10am New York/14:00 GMT on Thursday July 30

• EUR/USD: 1.1400 (2.7BLN), 1.1415 (2.6BLN), 1.1420-25 (1BLN), 1.1430-40 (1.3BLN), 1.1450-60 (2.4BLN)

• 1.1470-75 (1.4BLN), 1.1485-90 (752M), 1.1500-05 (1BLN), 1.1520-30 (1.7BLN), 1.1540-45 (2.1BLN)

• USD/CHF: 0.8055 (230M), 0.8075 (672M), 0.8100 (527M)

• EUR/GBP: 0.8560 (450M), 0.8580 (550M), 0.8600-05 (380M)

• GBP/USD: 1.3200 (510M), 1.3250-55 (384M), 1.3350 (208M), 1.3420 (660M)

• AUD/USD: 0.6950 (206M), 0.6960-70 (338M), 0.7000 (800M), 0.7025 (737M)

• NZD/USD: 0.5750 (353M). AUD/NZD: 1.1950 (930M), 1.1975 (252M)

• USD/CAD: 1.4015 (1.2BLN), 1.4100 (914M), 1.4105-15 (834M)

• USD/JPY: 163.00 (2.4BLN), 163.50-60 (2.1BLN), 164.00 (1.4BLN), 165.00 (4BLN)(Richard Pace is a Reuters market analyst. The views expressed are his own)

• GBP/USD down 0.2% in Asia on profit-taking after a 0.6% rally Wednesday

• Slips from an early 1.3383 high to 1.3344 as long-dated U.S. yields surge

• U.S. 30-year yield hovers near 19-year high hit Wed when it gained 12 bps

• Fed holds rates, its inflation resolve questioned, Warsh dodges guidance

• BoE expected to hold rates at 3.75% in a 6-3 vote Thursday

• Resistance at 1.3381, ten 1.3396-98 where 100 & 200-day MAs converge

• Support 1.3310-15, 1.3275-80; Wed range 1.3280-1.3385
GBP:

(Krishna Kumar is a Reuters market analyst. The views expressed are his own.)

Bank of America Global Research previews the July BoE meeting on Thursday.

"We expect the Bank of England (BoE) to keep the Bank Rate on hold at 3.75% this Thursday (7-2 vote with Pill and Greene voting for a hike with a high risk of a 6-3). We expect the overall message to be balanced. We expect the MPC to keep the door kept open to a hike, but don't expect it to give a strong signal about an imminent hike either, given uncertainty and limited second round effects so far. But the recent rise in energy prices imply that risks are tilted to a hawkish tone. But we also think the MPC could push back against market pricing, which is currently pricing close to three hikes," BofA notes.

"Ongoing momentum squeeze is likely to be the pervasive driver for GBP in the short-term. The BoE should therefore not unduly impact the pound against this backdrop. Indeed, any rally will likely be seen as an opportunity to sell," BofA adds.

• EUR/USD -0.1% Thur as FOMC fuelled rally loses momentum in Asia

• EU Q2 flash GDP due Thur, Reuters poll consensus +0.2% q/q, +0.5% y/y

• EU Jul consumer confidence & Jun unemployment rate (poll 6.2%) also due Thur

• U.S. completes air strikes on Iran, honouring Trump's threats of retaliation

• EUR likely to encounter resistance towards former 1.1500 support

• Range Asia 1.144825-75, support 1.1325, resistance 1.1500 1.1850 1.1930
EUR Daily 55-DMA


DXY Daily 55-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

• AUD/USD +0.1% Thur; Jun building approvals jump 7.2% (Reuters poll -1.0%)

• Sell AUD strength toward 0.7020-25 zone, expect drift toward 0.6908 200-DMA

• RBA likely on hold after Wed's cooler than expected inflation update

• U.S. fulfills retaliation threats with fresh air strikes on Iran

• DXY remains 0.5% lower in wake of FOMC decision to leave FFR unchanged

• Range Asia 0.6950-655 support 0.6920 0.6866 0.6834, resistance 0.7027
AUD Daily 200-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

• USD/JPY down 0.1% in Asia after closing 0.25% lower on Wednesday

• Weighed down by concerns the Fed is behind the curve on inflation

• Fed held rates steady in 3.50%-3.75% range; 3 of 12 policymakers back hike

• Oil rises sharply as Iran war widens, Wall Street fell sharply

• Longer-dated Treasury yields jump as inflation concerns grip markets

• Focus shifts to Friday, BOJ's rate decision; hawkish hold expected

• Support 163.00, 162.70, 162.50, resistance 163.60, 163.90-164.00

• Wednesday range 163.23-163.91, Asia 163.21-163.45
JPY:

(Krishna Kumar is a Reuters market analyst. The views expressed are his own.)

• EUR/USD +0.7% & DXY -0.6% after Fed votes to leave FFR target unchanged

• Three dissents preferred a 25 bps hike, 30-year UST yields jumped 11 bps

• Trump threatens retaliation against Iran for Wed's Middle East attacks

• Reports Yemen's Houthis considering Red Sea tolls; Brent crude +7.9%

• EUR pushing upper hourly Bollinger band, progress higher may slow in Asia

• EU Q2 flash GDP due Thur, Reuters poll consensus +0.2% q/q, +0.5% y/y

• EU Jul consumer confidence & Jun unemployment rate (poll 6.2%) also due Thur

• Range Asia 1.144825-69, support 1.1325, resistance 1.1500 1.1850 1.1930
EUR Daily 55-DMA


DXY Daily 55-DMA


EUR Hourly Bollinger Study

(James Connell is a Reuters market analyst. The views expressed are his own.)

• AUD/USD -0.3% since early Wed after oscillating in wake of Fed decision

• FOMC leaves FFR target unchanged, with three dissents preferring a hike

• Trump vowed to retaliate against Wed's surprise attack by Iranian forces

• Reports Yemen's Houthis considering Red Sea tolls; Brent crude +7.7%

• Pressure eases on RBA to hike after cooler than expected inflation update

• AUD likely to drift lower toward 0.6908 200-DMA, sell rallies 0.7020-25 zone

• RBA Assistant Governor Sarah Hunter speaking in Sydney early Thur

• Range early Asia 0.6950-63 support 0.6920 0.6866 0.6834, resistance 0.7027
AUD Daily 200-DMA


DXY Daily 55-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

CIBC Research reviews today's July FOMC statement.

"Today’s stand pat decision by the Fed provided little solace for those hoping to avoid a rate hike this year. A no-hike decision was mostly anticipated investors. But the fact that there were three dissenting votes in favor of a hike, a rare degree of divergence, after a unanimous decision to hold rates in June, should keep the market on alert for a hike in September, particularly with war clouds pushing up energy prices again. This wasn’t a meeting with an accompanying forecast, and the bare bones statement, identical to June’s other than the dissents, reflects Warsh’s distaste for forward guidance," CIBC notes.

"While our own forecast currently has the Fed on hold over the balance of the year, that call assumes an end to disruptions in Middle East oil traffic, which is far from a sure thing at this point. September’s meeting could readily see a quarter point rate hike if energy prices continue to escalate due to a more protracted conflict in the Gulf, raising the risk of further spillovers into core inflation," CIBC adds.

• NY opened near 1.1385 after 1.1403 traded overnight, the pair extended its drop early

• 1.1375 traded as the US dollar and US yields traded firmly

• EUR/USD then rallied towards 1.1400 as USD buying abated but selling took hold again

• Drops in stocks, gold, silver & comments from Pres. Trump helped EUR/USD near 1.1375

• Was trading around 1.1396 just before Fed announcement

• Post-Fed high was 1.1466, a touch below the upper 30-d Bolli at 1.1475

• The gains carried EUR/USD above the trend line off the May 11 high, 10- & 21-DMAs
eur post fed


(Christopher Romano is a Reuters market analyst. The views expressed are his own)

• NY opened near 0.6940 after 0.6977 traded overnight, pair rallied in early NY

• 0.6955 was neared on the back of broad based USD selling & equity gains

• Comments from President Trump & soured risk helped to send the pair downward

• Aussie struck the day's low near 0.6923 well before the Fed and was near 0.6935 before the announcement

• Low stopped before touching 200-DMA at 0.6909

• Then struck a post-Fed high of 0.6989, climbing back above the 21-DMA and stopping near the 10-DMA

• Big rebound leaves long-legged doji on the day's candle
AUD closer


(Christopher Romano is a Reuters market analyst. The views expressed are his own)

• GBP$ boosted in NY afternoon, +0.23% at 1.3322; NorAm range 1.3345-1.3280

• Post-Fed hold rally after vote came in 9-3, Hammack, Kashkari & Logan vote to hike

• Warsh says will not hesitate to act, nominal/real yields higher, inflation can't be cured in 9 wks

• Discussion centered on 5 yrs high inflation, recent econ shocks, oil price rise, monpol tools

• Markets react to less-hawkish hold; hike odds, USD and front-end yields lower

• BoE Thursday moves into focus, no change expected; dovish lean may reverse today's rise

• GBP$ res 1.3345 the post-Fed rise, 1.3362 the 50-DMA, 1.3398/99 200-DMA/daily cloud top

• Supt 1.3300 psychological lvl, 1.3280/74 Wed/Tues low area, 1.3213 June 30 low

GBP Chart:


(Paul.Spirgel is a Reuters market analyst. The views expressed are his own)

Nomura Research likes long EUR on some crosses

"With oil prices almost back to the ECB’s June “baseline” and gas prices closer to the “adverse” scenario, it seems highly likely that a second hike in the cycle will be delivered in September (in line with expectations), and with some upside risk as two hikes (including the one delivered in June) were in the baseline scenario," Nomura notes.

"While EUR/USD is at the mercy of commodity prices, we think there could be value in being long EUR on some crosses, which have already diverged from rates pricing and where further monetary policy divergence might become more apparent. EUR/GBP has started to bounce, while EUR/AUD and EUR/CAD are also potentially attractive on these factors," Nomura adds.

Months of persistent dip-buying continue to underpin USD/JPY, though a decisive break above 164.00 is still needed to reignite bullish momentum.

Buyers again emerged on Tuesday's dip to 163.28, extending a pattern since May as dollar longs continue to build since July 21.

Yet there remains little evidence of aggressive momentum buying at current levels. Open interest in yen futures recorded its first meaningful decline since early July, suggesting traders are trimming yen short exposure as spot USD/JPY struggles to surpass last week's multi-decade peak at 163.99.

That hesitation has emerged in relatively light trading conditions, leaving the pair trapped between solid demand around 163.00-20 and equally firm offers just below 164.00. With overnight implied volatility above 14%, those boundaries appear vulnerable after the Fed decision.

One-week options are pricing in an eventual break of 164 that exposes topside barriers. Supporting that view are firmer oil prices, expectations for a hawkish Fed outcome, and the prospect that intervention fears could ease temporarily after Friday's Bank of Japan meeting.

Alternatively, rising FX and equity volatility into August could pressure yen crosses as carry trades unwind, increasing the risk of a broader USD/JPY reversal if expectations for additional Fed tightening fade and long dollar positions unwind.

Technically, a sustained move through 164.00 would likely push USD/JPY into overbought territory, with an upper Bollinger near 164.25 acting as initial resistance. However, a close above the Bollinger top would likely fuel momentum toward the key 165.00 threshold.

On the downside, a break below the Tenkan-sen near 163.00 and the 21-day moving average around 162.65 would open a path toward the cloud top and lower Bollinger near 161, potentially forcing an unwind of crowded dollar long positions.
Yen


(Robert Fullem is a Reuters market analyst. The views expressed are his own.)

Bank of America Global Research highlights the expected flows from this month-end rebalancing.

"We estimate FX rebalancing needs based on a conventional 60/40 portfolio of global equities & bonds," BofA notes.

"Our estimates point to outperformance of GBP denominated assets over July.  This scope for rebalancing out of GBP (-1.5σ) and relatively muted inflows into EM and other DM denominated currencies (ex-JPY)," BofA adds.

(Updates)

• Shares of Allied Gold fell more than ~18% to C$24.29

• AAUC says its planned C$5.5 billion ($3.90 billion) sale to China's Zijin Gold was terminated after the companies concluded they were unlikely to satisfy closing conditions by the agreed deadline

• "The termination of the Arrangement Agreement relates to broader external factors applicable to cross-border transactions of this scale" - AAUC

• Says Zijin agreed to invest $295 million for a 9.2% stake in AAUC

• Including session's moves, AAUC shares were down 23.3% YTD

(Reporting by Sumit Saha and Dharna Bafna in Bengaluru)

Credit Agricole CIB Research highlights the suggested flow into this month-end fixing.

'Global equity markets were somewhat mixed in July. In FX, the USD was somewhat mixed on the month," CACIB notes.

"Overall, the moves in equity markets, when adjusted for market capitalisation and FX performance this month, suggest that month-end portfolio-rebalancing flows are likely to be mild USD buying across the board with the strongest buy signal in the case of the USD vs the CAD," CACIB adds.