Psychology for major markets Jul 23

EUR/USD – EUR/USD fairly steady above 1.17 as the USD generally weakens following the US/Japan trade deal. USD has been weak since tariffs were announced so unclear whether the EUR will benefit from a deal.

USD/JPY – JPY making some modest gains on the US/Japan trade deal news with Japanese yields rising, but upside limited by general risk positive reaction.

EUR/GBP – Backed away from 0.87 after stronger UK CPI in June, but rising monetary easing expectations on the back of more fiscal tightening suggest GBP downside risks

AUD/USD – Found good support below 0.64 and retains scope for gains above 0.66 if the USD slips back, provided regional equity sentiment holds up.

Equities – S&P futures holding near all time highs, but valuation is very expensive and market still vulnerable if economy shows weakness in response to tariffs.