Psychology for major markets July 28
Oman proposal to Iran on Strait of Hormuz management has regional backing
EUR/USD – EUR/USD is once again trying to gain support from the 1.135 region. This time USD seems to be gaining traction from poor risk sentiment, not only driven by Middle East conflict but also equities.
USD/JPY – The pair closed the Monday gap and will be patiently waiting for FOMC and then the BoJ. Hard to say where it will eventually go but if there is no very clear hawkish message, JPY have a chance to struggle.
AUD/USD – The Aussie is chopping around on the ebbs and flows of risk asset. No direction until central banks and Middle East clarity.
Equities & Others – Broader risk sentiment are sour, especially in Korea and Japan. The contagion is spreading to U.S. equities of a less magnitude.