The Swiss Franc extended its powerful rally on Thursday, breaching levels not seen in over two and a half years, as growing political turmoil in Washington accelerated the U.S. Dollar’s retreat across global markets. The USD/CHF currency pair tumbled sharply below the key psychological threshold of 0.8000, driven by investor angst over the Federal Reserve’s independence following a barrage of incendiary remarks from President Donald Trump.

Market participants scrambled into traditional safe-haven assets, with the Swiss Franc—often viewed as a shelter during times of geopolitical and institutional uncertainty—emerging as a top performer. The move marked a continuation of the “sell America” trade that has gained momentum in recent weeks as the U.S. Dollar’s credibility erodes under political interference and policy unpredictability.

Tensions between the White House and the Federal Reserve escalated dramatically on Wednesday after President Trump launched a blistering attack on Fed Chair Jerome Powell, labeling him “terrible” and “an average mentally person.” Trump went so far as to float the idea of publicly announcing Powell’s successor ahead of the scheduled end of his term in May next year—a suggestion that sent shockwaves through financial markets.

Such a move would be highly irregular and legally questionable, potentially creating a "shadow chair" that undermines the Fed's operational credibility. Investors viewed the remarks as a direct challenge to the independence of one of the world’s most powerful and respected central banks—an institution designed to be shielded from short-term political pressures in order to ensure long-term economic stability.

The market reaction was swift and brutal. Yields on U.S. Treasuries sank, risk sentiment deteriorated, and the U.S. Dollar came under intense selling pressure. The Swiss Franc, along with gold and the Japanese Yen, attracted heavy inflows as traders de-risked their portfolios.

Despite mounting political pressure, Fed Chair Jerome Powell has maintained a measured and deliberate tone. In his semiannual testimony to Congress earlier this week, Powell defended the central bank’s “wait-and-see” posture, emphasizing the importance of reacting to data rather than speculation.

Powell underscored that inflationary pressures—particularly those stemming from new and proposed trade tariffs—remain a real concern, and premature rate cuts could undermine the Fed’s credibility in anchoring inflation expectations. His stance came under fire from several Republican senators, who accused him of political bias, a charge Powell flatly denied.

Analysts suggest that while Powell’s commitment to central bank independence remains unwavering, the political noise surrounding the Fed is becoming a material risk in itself. The very notion of presidential interference in monetary policy—especially through the threat of an early replacement—risks institutional erosion and could diminish the Dollar’s long-held status as the global reserve currency.

Adding to the Dollar’s woes is the looming threat of unilateral tariffs. With a critical June 9 deadline fast approaching and no signs of resolution on key trade fronts, investors are bracing for another round of damaging import levies. These fears are magnified by recent soft U.S. economic data, which suggest that the post-pandemic growth cycle may already be losing steam.

In this environment, the combination of institutional instability, trade-related risks, and political volatility is accelerating the exodus from Dollar-denominated assets. The Swiss Franc, by contrast, is benefiting from Switzerland’s political neutrality, stable economic fundamentals, and historical role as a safe-haven currency.

From a technical standpoint, the breakdown in USD/CHF has opened the door to deeper losses. The pair decisively breached the key support level at 0.8055 during Thursday’s session, a level that had served as a floor for the past few weeks. The move confirmed the dominance of the prevailing bearish trend and was further supported by negative signals on the Relative Strength Index (RSI), which has turned lower after resetting from oversold conditions.

The Franc’s advance gained traction after rejecting off a key pivot level at 0.8070, now confirmed as near-term resistance. Price action suggests the pair is targeting the next support zone at 0.7962, with a break below that likely opening the path toward 0.7900 and potentially the October 2021 lows.

Should any signs of stabilization emerge, traders will watch the 0.8070–0.8100 zone closely for signs of a corrective bounce. However, as long as political instability dominates headlines and macroeconomic data supports a cautious Fed, the technical and fundamental bias for USD/CHF remains tilted to the downside.

SELL USDCHF

ENTRY PRICE: 0.8000

STOP LOSS: 0.8120

TAKE PROFIT: 0.7750

Starting June 23rd, the A-share market witnessed significant gains for three consecutive trading days. The Shanghai Composite Index climbed 2.86%, setting a new high for the year, the Shenzhen Component Index rose 3.88%, and the ChiNext Index surged 5.90%. This rally resulted from the convergence of multiple domestic and external factors:

Firstly, Iran-Israel Ceasefire:​​ An agreement between Iran and Israel significantly cooled geopolitical risks, despite minor subsequent friction. This prompted capital to flow back from safe-haven assets into equities. The ceasefire spurred a global rebound in risk assets, lifting major US indices, the Hang Seng Index, and Asia-Pacific markets. Foreign capital's appetite for Chinese assets strengthened. Data shows northbound capital recorded a net inflow exceeding CNY 12 billion on June 25th, hitting a nearly three-month high.

Secondly, the People's Bank of China (PBoC)'s Looser Policy Expectations Intensify:​​ On June 25th, the PBoC injected CNY 300 billion via its Medium-Term Lending Facility (MLF), resulting in a net liquidity injection of CNY 118 billion. Combined with CNY 200 billion in reverse repos, this brought the mid-June net liquidity injection to CNY 318 billion. The market anticipates a potential 0.5 percentage point reserve requirement ratio (RRR) cut and an interest rate cut by 30 basis points in H2 2025. These liquidity-easing expectations directly benefit financial heavyweights. Furthermore, six departments including the Financial Supervisory Administration jointly issued the "Guidance Opinions on Financial Support to Boost and Expand Consumption," explicitly promoting long-term capital inflows into the market and fostering stable capital market development. ​Regarding capital flows,​ margin financing balances have remained above CNY 1.8 trillion for 11 consecutive days. On June 25th, total trading volume on the Shanghai and Shenzhen exchanges surpassed RMB 1.6 trillion, expanding by over CNY 300 billion from the previous session. This indicates a synchronized recovery in leveraged capital and retail investor sentiment.

Notably, institutions like Goldman Sachs and UBS have upgraded their ratings on A-shares, forecasting the CSI 300 to reach a target level of 4,600 points, implying about 10% upside potential.

Based on the daily chart, the A50 index has rallied strongly following a deep correction starting in early April, testing the key 13,800 resistance level multiple times. This indicates robust short-term bullish momentum. Furthermore, after decisively breaking above multiple moving averages (MAs) in early May, subsequent pullbacks on June 2nd and June 23rd held firmly above the 60-day and 144-day MAs, reinforcing the bullish energy.

Regarding the moving average system, several MAs are showing signs of upward inflection, suggesting a gradually increasing probability of sustained near-term gains.

Currently, the A50 index faces near-term resistance at 13,800. As the price has touched this level several times, selling pressure has gradually been absorbed, increasing the likelihood of a breakout. A decisive break above 13,800 would open significant further upside potential, paving the way for a test of the previous high of 15,834.

Trading direction: Buy

Entry price: 13700

Target price: 14500

Stop loss: 13250

Valid Until: July 11, 2025, 23:00:00

Support: 13505/13264

Resistance: 13800/14566

The Bank of Japan’s Summary of Opinions from its June policy meeting, released earlier today, highlighted a growing divergence among board members regarding the timing and scale of future interest rate hikes. While some policymakers favored maintaining the current stance in light of global uncertainty and sluggish domestic growth, others emphasized persistent inflationary pressures and robust wage growth as reasons to consider further tightening.

This division has left markets without a clear signal on when the BoJ may act next, adding a layer of uncertainty to the yen’s outlook. Policymakers reiterated that any future rate hikes would be contingent upon economic and price developments materializing as expected. Although inflation has slightly exceeded earlier projections, the BoJ anticipates that Japan’s economic growth will slow, and improvements in consumer prices may remain moderate.

In the face of global risks such as trade tensions and geopolitical instability, the board generally agreed that maintaining the current accommodative stance remains appropriate for now—putting continued downward pressure on the Japanese yen.

Adding a more hawkish twist, BoJ board member Naoki Tamura offered a firmer view. Speaking in Fukushima, Tamura said there is a "good chance" the BoJ’s 2% inflation target could be achieved sooner than previously thought. He stressed the importance of timely and appropriate policy actions based on data trends, warning that inflation might accelerate more quickly than current forecasts suggest—potentially necessitating decisive tightening, even amid persistent global uncertainty.

Meanwhile, Fed Chair Jerome Powell reinforced the Fed’s cautious posture in his remarks on Tuesday, stating that the U.S. central bank is in no rush to cut rates. He cited uneven inflation data and pointed out that tariff-related price pressures are likely to appear in upcoming readings for June or July.

Powell’s message was in line with the tone of the June 18 FOMC meeting, during which policymakers penciled in two potential rate cuts in the second half of the year. Still, market participants remain split over the precise timing of any policy move, and interest rate expectations continue to shift with each new data release—keeping USD-sensitive assets like gold and the yen in sharp focus.

“If inflation pressures stay contained,” Powell said, “we’ll get to a point where rate cuts happen sooner rather than later, but I wouldn’t want to point to any specific meeting.” He also noted that any material deterioration in labor market conditions would influence the Fed’s decisions, although he added: “There’s no need to rush, because the economy is strong, and the labor market remains resilient.”

Boston Fed President Susan Collins echoed Powell’s stance, emphasizing that policy remains well-calibrated, the U.S. economy is solid, and there is still time to assess inflation’s trajectory before acting.

Adding to the uncertainty, U.S. consumer confidence data released Tuesday showed a decline, with the Conference Board’s index falling to 93.0 in June from 98.4 in May. The softer outlook suggests that consumers may pull back on spending in the months ahead, which could weigh on the Fed’s growth expectations and potentially influence the timing of interest rate adjustments.

USD/JPY has entered a correction phase after failing to hold above the 200-period moving average, which currently sits at 145.69. The pair initially attempted to build bullish momentum at this level, but strong selling pressure emerged. Price has since fallen sharply and closed below the 100-period moving average at 145.20—a technical breakdown that may pave the way for further downside acceleration.

Near-term bearish targets are now focused on the 144.40 area, which marks a previously tested support level. The RSI, meanwhile, is hovering just above oversold territory at 30.8. These levels often signal exhaustion among sellers and may spark a temporary rebound or consolidation before the broader downtrend resumes.

The 100-period moving average, now turned resistance, could act as a barrier if buyers attempt to push prices higher. However, as long as the pair remains below both key moving averages, the path of least resistance appears to be downward. Should RSI remain near oversold without a sustained bounce, it could confirm persistent bearish pressure and reinforce expectations of a deeper correction.

Trading direction: Sell

Entry price: 145.21

Target price: 144.40

Stop loss: 145.70

Validity: Jul 04, 2025 15:00:00

The recent agreement by Israel to the Trump-brokered ceasefire proposal with Iran has alleviated concerns regarding potential disruptions to Middle Eastern crude oil supplies, causing oil prices to fall to a two-week low. Although a risk premium remained embedded in crude oil prices, it has largely dissipated. If the ceasefire agreement is observed as announced, investors may anticipate a normalization of oil prices.

Looking ahead, the evolving situation in the Middle East continues to drive volatility in crude oil prices, with investors likely to monitor geopolitical developments for cues. Signs of de-escalation could trigger further profit-taking on prior gains, while an escalation of tensions could prompt a fresh rally in oil prices due to global supply concerns.

Furthermore, inventory data may also induce short-term fluctuations, with the API report indicating another substantial draw in inventories, leading traders to position themselves for a similar outcome from the EIA report.

Technically, the overnight sell-off in WTI crude oil prices reinforced the resistance zone between approximately US$78.45 and US$80.77 (year-to-date highs). It is evident that a breakout above this resistance zone will be challenging for crude oil.

WTI crude oil prices have retraced significantly from recent highs near US$76.71 and are currently trading around US$64.27. A death cross appears imminent as the 100-day SMA approaches the 200-day SMA from above.

This decline marks a notable reversal of the prior strong uptrend, indicating that profit-taking and bearish sentiment are weighing on prices. However, prices are testing a favorable area that could attract buyers and drive a resumption of the uptrend towards the next bullish target.

Based on Fibonacci extensions, WTI crude oil may retrace to the 38.2% level (US$70.93), but failed to provide sufficient support, subsequently rising to the 50% level (US$73.03). Sustained bullish momentum could drive it up to the 61.8% level (US$75.13), followed by the 76.4% level (US$77.73). The ultimate extension is at US$81.94 per barrel, assuming a favorable scenario.

However, technical indicators paint an increasingly bearish picture. The stochastic oscillator has plummeted from the overbought territory and is now approaching oversold conditions, suggesting potential continued selling pressure in the short term. Nevertheless, the rapid decline of the oscillator also indicates a possible rebound in the near term once extreme oversold levels are reached.

Similarly, the Relative Strength Index (RSI) has also declined significantly from its highs and is currently trending towards the oversold zone. The rapid weakening of momentum suggests that bears have firmly grasped control of the market, but the indicator's proximity to oversold conditions may signal an impending rebound.

Indeed, given that the 1D structure remains in a death cross, it is recommended to continue to go short at the highs.

Trading Direction: Sell

Entry Price: 64.80

Target Price: 60.42

Stop Loss: 67.95

Valid Until: July 10, 2025 23:55:00

Support: 63.68, 62.70, 60.58

Resistance: 65.29, 66.90, 67.84

Fed Chair Jerome Powell reaffirmed on Tuesday that the Federal Reserve is in no hurry to cut interest rates, highlighting the uneven nature of recent inflation data. He also noted that price pressures tied to tariffs are likely to emerge in the inflation prints for June or July. His remarks echoed the tone of the June 18 FOMC meeting, where policymakers projected two rate cuts in the second half of the year.

Despite that outlook, market participants remain divided on the exact timing and certainty of the Fed’s next moves. Rate expectations continue to shift in response to incoming data, keeping assets like gold highly reactive.

“If inflationary pressures stay contained,” Powell said, “we’ll get to a point where rate cuts happen sooner rather than later, but I wouldn’t want to point to any specific meeting.” He added that a significant deterioration in labor market conditions would also weigh on the Fed’s decision-making. However, he emphasized that there is no need to rush, stating, “The economy is strong, and the labor market remains resilient.”

This reiterates the Fed’s data-dependent stance, reinforcing the importance of upcoming economic figures for both monetary policy direction and gold’s short-term trajectory.

Boston Fed President Susan Collins echoed Powell’s sentiment, repeating on Tuesday that current policy remains well-positioned, the U.S. economy is solid, and there is room for patience as inflation continues to evolve.

U.S. consumer confidence data released Tuesday added to market uncertainty. The Conference Board’s Consumer Confidence Index fell to 93.0 in June, down from 98.4 in May. A more cautious consumer outlook could imply softer spending ahead, potentially weighing on the Fed’s growth forecasts and influencing the timing of any rate adjustments.

In other economic data, U.S. new home sales dropped by 13.7% in May, falling from 722,000 to 623,000 units. Analysts had expected a smaller decline to 693,000. Elevated 30-year mortgage rates near 7% appear to be discouraging buyers from entering the housing market.

Gold has found strong support near the 200-period moving average, currently around 3319. After dipping to 3295, the metal quickly rebounded, forming a local low without extending to new lows. This bounce suggests that bearish momentum may be weakening. If the price manages to close decisively above the 200-period MA, a fresh leg higher could target the 3400 area.

Additionally, the Relative Strength Index (RSI) has dropped to 29 — entering oversold territory. This suggests selling pressure may be fading, with buyers potentially stepping in. Oversold RSI levels often precede trend reversals or short-term rebounds.

If gold fails to print a new local low and closes above the 100-period moving average at 3361, it could confirm a bullish reversal, with a sustained move higher increasingly likely from current levels.

Trading direction: Buy

Entry price: 3331

Target price: 3395

Stop loss: 3280

Validity: Jul 04, 2025 15:00:00

The Euro strengthened modestly against the Japanese Yen on Wednesday, with EUR/JPY climbing back toward 168.80 during the European session, as bullish momentum regained footing following a brief pullback. The pair’s ability to bounce back highlights its resilience within a well-defined ascending channel, supported by improving global risk sentiment and diverging central bank trajectories.

The latest price action reflects broader macroeconomic dynamics, where geopolitical de-escalation and central bank positioning continue to play central roles. Despite lingering uncertainties, market participants appear more comfortable rotating back into risk-sensitive trades such as EUR/JPY — with technical indicators reinforcing that the bullish trend remains intact.

The Japanese Yen has remained largely stable in the wake of the Bank of Japan’s (BoJ) Summary of Opinions released earlier this week, which revealed a cautious tone among policymakers. Several board members emphasized the need to maintain current interest rates due to growing concerns over the long-term impact of U.S. tariffs on Japan’s economy.

Although these tariffs have yet to exert material influence, the BoJ warned of a potential deterioration in corporate sentiment, particularly among export-reliant firms. The emphasis on uncertainty highlights the central bank’s preference for patience as it navigates an increasingly complex global landscape — a position that continues to limit upside potential for the Yen, especially against currencies like the Euro.

At the same time, domestic data presents a nuanced picture. Japan’s core inflation surged in May to its highest level in over two years, remaining well above the BoJ’s 2% target and underscoring persistent price pressures. Furthermore, Japan’s latest PMI data surprised to the upside, suggesting robust business activity and leaving the door open for possible rate hikes later this year. Still, until there is clarity on external risks, the BoJ appears reluctant to pivot decisively toward normalization.

Risk sentiment received a notable boost after U.S. President Donald Trump announced a ceasefire between Iran and Israel, easing tensions after nearly two weeks of conflict. The de-escalation has improved investor confidence globally, helping carry risk-on flows back into high-beta assets, including EUR/JPY.

Nevertheless, traders remain cautious. A classified U.S. intelligence report, cited by Reuters, suggested that U.S. strikes on Iranian nuclear facilities have delayed Tehran’s progress by only a few months. Iran’s Foreign Minister Abbas Araghchi also confirmed the continuation of the country’s nuclear program, according to Al Arabiya. As such, the geopolitical risk premium has not been entirely erased, leaving room for renewed volatility.

Meanwhile, on the European front, ECB policymakers have maintained a tone of pragmatic dovishness. Governing Council member François Villeroy de Galhau said in an interview with the Financial Times that the central bank could still consider rate cuts despite volatility in oil markets. Chief Economist Philip Lane echoed the message, emphasizing the need to consider not only the baseline inflation trajectory but also surrounding risks to growth and price stability.

This measured tone from the ECB, while dovish, has not significantly dented the Euro, which remains supported by broadly stable macro fundamentals and a market expectation for only gradual easing — reinforcing EUR strength relative to the Yen.

From a technical perspective, EUR/JPY continues to exhibit a bullish bias, with price action unfolding comfortably within a rising channel pattern. After pulling back in the previous session, the pair has found support around the 167.60 level — a critical area that has helped to rebuild positive momentum.

As of the European session, the pair is oscillating near 168.80, showing signs of renewed buying interest as the stochastic oscillator works off overbought levels. The ability to hold above the 9-day EMA at 167.68 reinforces short-term stability, while upside targets remain in view.

The next key resistance zone lies at 169.20, followed by the 11-month high of 169.72 set on June 23. A decisive break above this area would reinforce the bullish momentum and could pave the way for a test of the psychologically significant 170.00 level — a zone that could attract further buying interest and potentially usher in fresh highs for the cross.

On the downside, failure to maintain support at 167.68 could see EUR/JPY drift lower toward the channel base near 166.00. Below that, the 50-day EMA at 164.57 provides a more medium-term floor, though a breach of this zone would likely signal a deeper corrective phase.

BUY EURJPY

ENTRY PRICE: 169.20

STOP LOSS: 167.80

TAKE PROFIT: 172.00