Bearish is the current week so far for the US dollar. The USD Index is currently at 92.56, having opened the week at 92.89. Of course, all the investors’ eyes will fall on the FOMC (Fed Interest Rates decision & Monetary Policy announcement) today. Most likely, the Interest Rates and the Monetary Policy will remain unchanged so the whole thing has to do with a possible tapering: if the Fed will reduce its bond-buying program in the visible future. In case of a positive answer, the USD is said to perform important profits. The rest of the US announcements so far are not positive at all as the Durable Goods Orders were expected to be 2.1% in June but the result was 0.8%.

On the other hand, the Delta mutation keeps on developing worries in the markets as it is a serious concern regarding the return to normalcy.

EURUSD (current price 1.1806) managed to rise, starting the week from 1.1770, up to 1.1841 but today is a bearish day so far. Of course, markets are on a ‘hold-on’ mode for the FOMC later today but it seems that a possible uptrend has no fuel for the moment. The Business Climate in Germany announced below expectations and the Consumer Confidence Survey also announced below 0 while the expected value was 1. The rest of the week is full of important economic news for the Eurozone and Germany but the course of the dollar will dominate, as usual.  A solid bearish breakout below 1.18 will make the pair’s sellers go after the main support of 1.17.

GBPUSD (current price 1.3865) continues the bullish trend that has taken since the end of the last week. It’s not only Michael Saunder’s statement last week that gave a boost to GBP but it is also the number of new COVID-19 cases in the UK that has dropped from 60K to 23K in just a few days. The Fed session today will affect the US dollar and the pair. The UK has no other important economic news during the current week so the course of the COVID-19 in the country along with the USD strength/weakness will define the pair’s trend and volatility in the following days. If GBPUSD manages to surpass 1.3910 then the price area of 1.40 is visible enough.

USDJPY (current price 110.09) has returned today above the milestone price of 110, after two bearish days that created a weekly low at 109.58. Bond yields had dropped early this week (US 10-year bond yield dropped to 1.22% and it is currently at 1.26%) but now we see a recovery and this fact is helping USDJPY to recover as well.  Haruhiko Kuroda (Bank of Japan) said that the country is not in deflation anymore and inflation of 2% is the most possible scenario. The pair shows stability above 110 but of course, the Fed session today may change things.

EURGBP (current price 0.8512) finally reached the price area of 0.85 as many traders & investors (including us) expected. The next support for the pair is at 0.8470 which is also the lowest price since Feb. 2020. The sterling seems stronger than EUR because the Monetary Policy expectations from the Bank of England is in a more hawkish tone, compared to ECB which will continue the loose policy, as Christine Lagarde mentioned last week. There is a reasonable bullish reaction from 0.85 but the main trend of EURGBP remains bearish.