Errante’s The Week Ahead: 28^th July – 1^st August 2025 

Highlights of the Week 

• FOMC Rate Decision: Wednesday’s Fed meeting is the centerpiece, with no change expected, but forward guidance and the press conference may drive sharp moves across USD pairs, equities, and gold. 

• US Jobs Data: Friday’s Nonfarm Payrolls (NFP), Unemployment Rate, and Average Hourly Earnings will test the US economic resilience narrative. A weak print could cement dovish expectations; strong data might rekindle USD support. 

• Eurozone and German CPI: German and Eurozone inflation updates will set the tone for EUR crosses ahead of the next ECB meeting. 

• BoC and BoJ Decisions: Bank of Canada and Bank of Japan both meet; no changes expected but forward guidance could shift risk sentiment, especially in USD/JPY and CAD pairs. 

What Now? 

Fed, Payrolls, and Tariff Deadlines Create a Tense Crossroads 

The coming week brings a decisive test for global markets, as investors brace for a confluence of high-impact events: the Federal Reserve’s rate decision, the Bank of Japan’s policy update, the monthly US non-farm payrolls, and the deadline for key US tariff deals. Despite fresh record highs in equities earlier in the week, risk appetite is now under pressure, with the MSCI global equity index retreating from its peak and both the Nikkei and Topix pulling back after strong runs. 

Market Focus Shifts from Euphoria to Fragility 

While the Federal Reserve is widely expected to maintain rates at 4.50%, attention will center on Jerome Powell’s press conference for any signal about the likelihood and timing of future rate cuts. US macro data remains mixed: softening consumer confidence, moderating job openings, and last month’s payrolls modestly beating expectations. Yet, with the US Dollar Index (DXY) registering its first weekly decline in four weeks, investor sentiment reflects heightened caution, especially as Friday’s employment and wage data could decisively shift the Fed narrative for Q4 2025. 

Tech Sector Volatility and Trade Tensions Add Complexity 

Market sentiment is also sensitive to fresh earnings volatility in US tech. Despite Alphabet’s strong results driving the Nasdaq to new highs, sector momentum is uneven—Intel shares fell 5% Friday’s pre-market on disappointing guidance and project cuts, while Amazon, Apple, Meta, and Microsoft are all expected to address tariff concerns in upcoming earnings. If trade tensions escalate or corporate earnings falter, the “glass-half-full” approach that has sustained equities could quickly reverse. 

US Dollar No Longer the Ultimate Safe Haven? 

One of the most notable shifts is the dollar’s waning haven status. Despite risk-off moves in equities, DXY heads for a notable weekly loss. This uncoupling suggests that policy uncertainty, US debt concerns, and the shifting correlation between risk sentiment and the dollar are now dominant themes. Risk-off no longer means dollar up. This is a key regime change for FX traders. 

Central Banks on Hold as Policy Divergence Widens 

On the central bank front, the Fed and ECB are expected to remain on hold, with money markets pricing in just 42 basis points of Fed easing for the rest of 2025. The ECB’s pause and the BOJ’s upcoming policy decision reflect an increasingly divergent global monetary backdrop, while political risk rises as President Trump keeps up pressure on Powell amid the backdrop of a rare presidential visit to the Fed. 

Europe and Commodities: Disinflation and China in Focus 

European markets remain locked in a disinflationary trend, with eurozone and German CPI expected to confirm ongoing softness and keep the ECB dovish. German Bund yields have ticked higher but the euro remains stable. Meanwhile, commodity markets will be driven by China’s PMI prints and shifting global risk mood: gold has lost momentum, facing a technical inflection point, while crude oil prices are reacting to both inventory data and the broader macro narrative. 

Opinion: 

Ali Mortazavi, Head of Education at Errante, emphasizes, “With global stocks pausing after record highs, upcoming Fed and BOJ meetings, and the Trump tariff deadline all approaching, next week is poised to set the tone for Q3 market direction. I expect volatility to increase as traders weigh policy guidance, macro data, and geopolitical developments. Prudent risk management and agility are paramount: conviction trades should be paired with strict stop-losses, and the focus should remain on where expectations diverge most from outcomes—especially in the USD, US tech, EUR/USD, and key commodities.” 

Market Events and Announcements (GMT+3) 

Monday, 28^th July 2025 

• No high impact event 

Tuesday, 29^th July 2025 

• 17:00 — USD: CB Consumer Confidence (Jul) 

• 17:00 — USD: JOLTS Job Openings (Jun) 

Wednesday, 30^th July 2025 

• 11:00 — EUR: German GDP (QoQ, Q2) 

• 15:15 — USD: ADP Nonfarm Employment Change (Jul) 

• 15:30 — USD: GDP (QoQ, Q2) 

• 16:45 — CAD: BoC Interest Rate Decision 

• 17:30 — USD: Crude Oil Inventories 

• 21:00 — USD: FOMC Statement & Fed Interest Rate Decision (4.50% expected) 

• 21:30 — USD: FOMC Press Conference 

Thursday, 31^st July 2025 

• 4:30 — CNY: Manufacturing PMI (Jul) 

• 6:00 — JPY: BoJ Interest Rate Decision 

• 15:00 — EUR: German CPI (MoM, Jul) 

• 15:30 — USD: Core PCE Price Index (YoY & MoM, Jun) 

• 15:30 — USD: Initial Jobless Claims 

• 16:45 — USD: Chicago PMI (Jul) 

Friday, 1^st August 2025 

• 12:00 — EUR: CPI (YoY, Jul) 

• 15:30 — USD: Average Hourly Earnings (MoM, Jul) 

• 15:30 — USD: Nonfarm Payrolls (Jul) 

• 15:30 — USD: Unemployment Rate (Jul) 

• 16:45 — USD: S&P Global Manufacturing PMI (Jul) 

• 17:00 — USD: ISM Manufacturing PMI (Jul), ISM Manufacturing Prices (Jul) 

Market Insights: Key Charts to Watch 

1. Dollar Index (DXY) — Daily Chart 

Current Market Trend and Momentum: 

DXY has been in a well-defined downtrend since Q2, below the 100-WMA, and unable to regain its 98.90-99.00 resistance. The latest bounce stalled at the 61.8% Fibonacci retracement (98.25 zone), with the index retreating to just above 97.75. Momentum oscillators (Stochastics, RSI) show a tentative bottoming, but no clear bullish signal. MACD remains slightly negative, confirming weak upward momentum. 

Main Scenario: 

As long as DXY holds below 98.95 resistance and 100-WMA, the trend remains bearish. Immediate support sits at Bollinger’s middle band at around 97.75; a decisive break would open the door to 97.10 and, if risk sentiment improves globally, even the 96.50 region. 

Key Levels: 

• Support: 97.75, 97.10, 96.50 

• Resistance: 98.25 (61.8% Fibo), 98.95, 99.45, 100.09 

Alternative Scenario: 

A sustained daily close above 98.25 would signal short-term reversal potential, targeting 99.45 and then the psychological 100.00 barrier, but this requires much stronger-than-expected US data and a hawkish Fed. 

2. Gold (XAU/USD) — Daily Chart 

Current Market Trend and Momentum: 

Gold has failed repeatedly at the $3,439–3,450 ceiling, forming a minor double top, but still finds bids above the uptrend line ($3,309), with rising long-term weighted moving averages supporting the bullish structure. Momentum (Stochastics and MACD) is neutral to slightly positive, while RSI holds near 50—reflecting an indecisive but supportive backdrop. 

Main Scenario: 

Gold’s outlook remains constructive above $3,309. If buyers can reclaim the $3,359–$3,408 region (61.8% and 23.6% Fibo retracements), the door opens for a retest of the $3,439–$3,450 resistance, and—if the Fed surprises dovish or data disappoints—an extension towards $3,500. 

Key Levels: 

• Support: $3,309, $3,275, $3,230 

• Resistance: $3,359, $3,408, $3,439–$3,450, $3,500 

Alternative Scenario: 

A sustained break below $3,309 would neutralize the medium-term uptrend and risk a deeper pullback towards $3,275 and possibly $3,230 (161.8% Fibo extension), especially if the Fed signals a more hawkish stance or NFP delivers a strong upside surprise. 

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