The US dollar is demonstrating a lack of volatility in its trading performance relative to the major currencies. The euro persists above $1.17, and sterling continues to hold above $1.35; nonetheless, the market appears determined to further challenge these support levels. The greenback has come near JPY158, staying just beneath that level. Last week, it seems that the Bank of Japan might have engaged in market intervention. In the United Kingdom, Prime Minister Starmer’s adversaries are preparing to mount a challenge. China has pledged to enhance its acquisitions of the B-3—beans, beef, and Boeing. Trump and Xi have participated in a succession of formulaic dialogues, as Beijing has reaffirmed its position that Taiwan constitutes a fundamental interest. While Xi has reiterated the conventional assertion of enhancing China’s openness to foreign enterprises, it is, in fact, foreign businesses that are actively seeking to mitigate risks associated with their operations in China. A new “board of trade” is expected to be formed, despite the existence of similar forums in the past that yielded limited results. The PBOC set the dollar’s reference rate at a new three-year low today.

The euro found itself at the lower boundary of this month’s range yesterday, briefly falling below $1.17 ahead of the expiration of the one-billion-euro option. Options totaling over 1.7 billion euros are scheduled to expire today as well. In the aftermath of the recorded low, just before the opening of North American banks, the euro faced challenges in making substantial gains above the $1.1720 threshold, which represented Tuesday’s low. The month’s low was recorded on May 5 at approximately $1.1675, marginally below the 200-day moving average of about $1.1685. The market is prudently maneuvering within the area that may have witnessed BOJ intervention last week. The dollar reached a value of JPY157.90 yesterday. Bloomberg’s pricing suggests that the dollar attained a zenith just below JPY157.95 last Wednesday. It appeared to reach JPY158 today without exceeding that threshold. Our examination of the macroeconomic environment and technical indicators suggests that policymakers are poised to encounter considerable difficulties. The daily momentum indicators are demonstrating a positive trajectory. Options priced at JPY158 for $1 billion are set to expire today. Market participants are expected to proceed with caution, and a movement surpassing JPY158 may face resistance around the 20-day moving average, which is roughly JPY158.25.

Sterling fell below $1.35 yesterday for the first time this month, although it later recovered that level prior to the expiration of the options established at that price. The endeavor to restore momentum stumbled around $1.3530. It is noteworthy that sterling experienced a rally from its lowest point of the year on March 31, approximately $1.3160, to reach a two-and-a-half-month high on May 1, around $1.3660. Options for GBP1.2 billion at $1.3570 are poised to expire today; nonetheless, sterling has failed to exceed $1.3535 throughout the trading session. The rally in nickel seems to be waning in strength. The five- and 20-day moving averages are demonstrating a downward trend, and the momentum indicators have likewise transitioned to a declining trajectory. A decisive breakthrough at 1.35 aims for the 1.3440-50 range.

The US dollar fluctuated within a narrow range of about 15 pips around CAD1.3700 yesterday and maintains this pattern today. Options valued at approximately $340 million at a rate of CAD1.3715 are scheduled to expire today. The expected upside breakout seems to be on the horizon. The anticipated technical target is roughly CAD1.3750. The Australian dollar demonstrated strong trading performance yesterday. It rose to the upper limit of the range set the previous Wednesday, just below $0.7280. Nonetheless, the Australian dollar reached a new high close, a level not observed in almost four years, and maintains its position as one of the strongest major currencies, even as momentum indicators appear to be over-extended. It is demonstrating limited fluctuation today, varying within a range of approximately 0.7240 to 0.7265.