Asian Session Summary

The Asian session was dominated by a sharp yen rally that dragged USD/JPY from the 157.89 high down to 155.21 before settling near 156.74 — a 2.15% drop that carries all the hallmarks of Japanese FX intervention. The move ripped through JPY crosses uniformly: AUD/JPY fell 2.24%, CAD/JPY dropped 2.35%, and GBP/JPY shed 2.15%. Meanwhile, DXY sits essentially flat at 99.81, masking the violence underneath — the dollar lost ground to JPY and held steady against Europe. Oil’s overnight collapse added another layer. WTI cratered nearly 8% intraday on Iran peace deal headlines before stabilising in the mid-$79 range. Gold rallied 1.63% to $4,115 and copper added 2%, painting a classic risk-rotation picture: geopolitical risk premium unwinding in energy, rotating into metals.

Key Pairs for London

USD/JPY — 156.74
The session’s main event. A 268-pip range (155.21–157.89) with intervention-style price action in Asia. The 155.00 round number held as support on the flush. If London dealers test the downside, 155.21 is the session low to break; failure to get below it likely triggers a short squeeze back toward 157.00. Exporters and real-money accounts typically step in on these intervention dips — watch the first 90 minutes for direction.

EUR/USD — 1.1530
Holding comfortably above 1.15 with a narrow 37-pip range so far. The session high at 1.1562 is the level to clear for a push toward 1.1580–1.1600. DXY’s flatness despite the JPY intervention suggests the euro isn’t getting much of a tailwind from dollar weakness — this is JPY-specific, not broad USD selling. Downside support sits at 1.1525 (today’s low).

GBP/USD — 1.3462
Cable printed a high of 1.3506 but has faded back. UOB flagged 1.3555 as a potential stall zone for the rally, and the pair couldn’t sustain above 1.35 in Asia. For London, 1.3455 (today’s low) is the floor to hold. A break above 1.3506 reopens the path toward that 1.3555 resistance. The pound’s underperformance versus the euro (EUR/GBP nudging higher at 0.8562) suggests sterling-specific headwinds into the European open.

AUD/USD — 0.7020
Slightly negative despite copper’s 2% gain. Oil’s collapse is the drag — Australia exports LNG and the broader commodity complex read is mixed. The 0.7000 round number is the obvious support; 0.7058 (session high) is resistance. AUD/JPY’s 2.24% drop shows the Aussie was caught in the JPY cross liquidation. If that flow stabilises in London, AUD/USD could reclaim 0.7050.

USD/CAD — 1.4042
Oil’s plunge is the CAD story. WTI down nearly 8% intraday is a direct headwind for the loonie, and USD/CAD has ground higher to 1.4042. The range is tight (1.4001–1.4045), but a sustained WTI hold below $80 keeps the pair biased toward 1.4080–1.4100. Support at the round 1.4000 would need an oil bounce to hold.

London Calendar Watch

First business day of August puts final July Manufacturing PMIs on the tape. The Eurozone and UK S&P Global Manufacturing PMI finals are due in the first two hours of the London session — any downward revision from flash readings would weigh on EUR and GBP respectively. Beyond scheduled data, the intervention headlines will keep USD/JPY vol elevated. Watch for any MoF or BoJ commentary confirming or denying intervention — Japanese officials typically stay ambiguous, but the price action speaks clearly enough. The Iran peace deal narrative could also develop through the European morning; Iran’s foreign ministry already denied current US talks on Hormuz, so any further headlines either confirming or walking back the deal will move oil and by extension NOK and CAD.

Bias Going In

EUR/USD and GBP/USD enter London with a cautiously constructive tone — both held above round-number support (1.15 and 1.3450) through Asia, and DXY’s inability to rally despite risk-off flows in oil suggests the dollar lacks upside momentum beyond JPY. Commodity-linked pairs face asymmetric risk: CAD is vulnerable to further oil weakness while AUD could catch a bid if copper’s strength broadens. The dollar’s overall tone is neutral-to-soft — the intervention-driven JPY bid absorbed the session’s energy, and without a fresh USD catalyst, the greenback likely drifts into the PMI prints.

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