The US index scored its biggest drop in the first half of the year in 50 years, and the US Treasury Secretary hinted that the "shadow Fed Chairman" arrived early next year!

On July 1, early trading in the Asian market on Tuesday, Beijing time, the US dollar index hovered around 96.70. On Monday, the US dollar index fluctuated downward during the day, falling below the 97 mark and finally closed down 0.49% at 96.77. It is worth noting that the US dollar index has closed down for the sixth consecutive month, marking its largest first-half decline since the early 1970s; the benchmark 10-year U.S. Treasury yield closed at 4.228%, and the 2-year U.S. Treasury yield closed at 3.723%. Thanks to the weakening of the US dollar, spot gold rebounded and recovered the $3,300 mark, finally closing up 0.88% to close at $3,302.21/ounce; spot silver finally closed up 0.31% to $36.08/ounce. As investors weighed the mitigation of risks in the Middle East and the possible increase in OPEC+ production in August, the two oils rose and fell, WTI crude oil rose first and then fell, and once rushed above $65 during the session, but then gave up all the gains in the day and turned down, and finally closed down 0.16% at $64.31/barrel; Brent crude oil closed up 0.19% at $66.38/barrel.

Analysis of major currencies

Dollar Index: As of press time, the US dollar index hovers around 96.70. Market sentiment remains positive as the U.S. stock index performed strongly in the second quarter of 2025, hitting record highs. As a result, the US dollar (USD) approached a multi-year low as markets expected a substantial increase in fiscal deficits and market participants expected the Federal Reserve to relax more than 50 basis points (bps), pushing the euro to a four-year high. Technically, the US dollar indexThe nearest support is in the range of 96.70–96.90. A break below the 96.70 level will push the US dollar index to the next support level, which is in the 95.40–95.60 range.

Euro: As of press time, the euro/dollar hovers around 1.1792. The dollar continues to be hit by the outlook for U.S. budget approval and the expected impact of the Trump administration's continued progress on trade deals with major trading partners. On Tuesday, Fed Chairman Jerome Powell will share a panel discussion with ECB President Christina Lagarde, BoE President Andrew Bailey and BoJ Governor Kazuo Ueda. Technically, if the EUR/USD successfully closes above resistance level 1.1785–1.1800, it will move to the next resistance level 1.1895–1.1910.

GBP: As of press time, GBP/USD is hovering around 1.3737. On Monday, the volume continued to rise with thin intraday trading volume. The dollar liquidity continues to be bearish, limiting the downside of the pound. On Monday, the overall UK economic data failed to have an impact on the market, and pound traders will pay attention to the double appearances of Bank of England (BoE) Governor Andrew Bailey and Federal Reserve Chairman Jerome Powell on Tuesday. The two central bank leaders will attend the 2025 Central Bank Forum in the European Central Bank (ECB) held in Sintra, Portugal. Technically, breaking through the 1.3750 level will open up the way to test the next resistance level 1.3815–1.3835.

Analysis of gold and crude oil market trends

1) Analysis of gold market trends

On Tuesday, gold trading around 3311.17. Gold prices climbed further to a high of $3314.34/ounce and are currently trading around $3310/ounce. Investors are focusing on the upcoming U.S. employment data in order to see the future direction of the Federal Reserve's monetary policy. Against the backdrop of intensifying global economic uncertainty, the attractiveness of gold as a safe-haven asset has emerged again.

Technical: From the daily chart, gold has fallen into a significant downward trend after the failure of the previous breakthrough. Currently, gold is operating in a typical descending triangle pattern, with the 3300 mark becoming the key upper resistance level. The Bollinger Band indicator shows that gold fell below the Bollinger middle track (3343).And approaches the Bollinger lower track down (3265), indicating that short-term volatility expands and short sellers dominate the market. The indicator DIFF line and DEA line show a dead cross state, and the MACD bar chart continues to expand the green bar, reflecting the enhanced trend short momentum. The RSI relative strength indicator remains at a low of 43.34 and has not yet entered oversold, but the downside space is still being released. The analysis believes that the lower support focuses on the 3230 line. If it falls, the probability of falling 3120 or even lower 2832 in the past increases significantly. On the contrary, if the upper part cannot effectively recover the range of 3300-3330, the rebound height will continue to be limited.

2) Analysis of crude oil market trends

On Tuesday, crude oil trading around 64.29. Oil prices fell slightly on Monday, with investors weighing the mitigation of risks in the Middle East and the possible increase in OPEC+ in August. Last week, Brent and U.S. crude oil both hit their biggest single-week declines since March 2023. However, the monthly lines of the two rose for the second consecutive month, with an increase of about 6% and 7% respectively.

Technical: In the short term, bearish correction trends dominate, and the trading price is lower than EMA50, which brings continuous negative pressure. WTI crude oil prices have formed a negative technical pattern in the latest decline, namely the bearish flag pattern, increasing the possibility of continuing declines. Negative signals from the relative strength indicator (RSI) reinforce this scenario, especially after reaching oversold levels, which suggests weak bullish momentum and increases the possibility of a continued decline in subsequent trading. Therefore, we expect crude oil prices to fall below the $63.70 support level in the next day trading and approach the next support level of $59.75. The trading range is expected to be between the $61.50 support and the $66.40 resistance level.

Forex market trading reminder on July 1, 2025

To be determined Domestic refined oils open a new round of price adjustment window

09:45 China's June Caixin Manufacturing PMI

14:00 UK June Nationwide House Price Index Monthly Rate

14:30 Switzerland's May actual retail sales annual rate

15:50 France's June manufacturing PMI final value

15:55 Germany's June manufacturing PMI final value

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15:55 The number of unemployed people in Germany after the seasonal adjustment in June

15:55 The unemployment rate in Germany after the seasonal adjustment in June

16:00 The final value of manufacturing PMI in the euro zone in June

16:30 The final value of manufacturing PMI in the UK in June

17:00 The initial value of CPI in the euro zone in June

17:00 The initial value of CPI in the euro zone in June

21:30 The governors of major central banks in the world held group talks

21:45 The USThe final value of S&P Global Manufacturing PMI in June

22:00 US June ISM Manufacturing PMI

22:00 US May JOLTs job vacancy

22:00 US May Construction Expenditure Monthly Rate

The next day 04:30 US to June 28 API crude oil inventories

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