Trade turmoil keeps dollar on solid footing
Markets remain cautious as the US ramps up trade tensions, with fresh tariffs and tough rhetoric driving sharp moves across currencies and commodities. The developments underscore how political shifts continue to influence global market dynamics and investor sentiment.
US dollar firms
The US dollar remains on a firm footing, trading at 97.241 at the time of writing, after touching an intraday high of 97.356.
The broader USD Index (USDX) rose to 97.602—its highest level since 25 June—driven by renewed trade tensions and strong language from President Trump regarding tariffs.
The most significant market mover came overnight, when Trump imposed a 50% tariff on copper imports. This announcement sparked a sharp 10% surge in US copper futures.
Copper, which plays a crucial role in electric vehicles, energy infrastructure, and military production, was already facing global supply constraints—adding further pressure to the market.
Meanwhile, copper prices dropped in London and Shanghai, as traders braced for potential disruptions in the supply chain and rushed shipments to the US ahead of the new tariff implementation.
The policy shift highlights how Trump’s evolving trade stance continues to impact both commodity markets and currency valuations globally.
Pharmaceuticals and semiconductors in the crosshairs
President Trump also signalled forthcoming tariffs on pharmaceutical goods and semiconductors—industries heavily reliant on East Asian exporters, particularly Japan and South Korea.
Both countries have been given a deadline of 1 August to negotiate separate trade deals or face substantial tariff increases.
On Monday, Trump referred to the deadline as “firm, but not 100% firm,” but reversed his tone on Tuesday, stating unequivocally that “no extensions will be granted.”
This hardline position rattled global markets, sending US futures slightly lower by 0.1%, while the S&P 500 spot index extended earlier losses, down 0.8% for the week.
Technical analysis: USDX at a turning point
From a technical standpoint, the US Dollar Index remains in a short-term consolidation phase, just below key resistance around 97.47, after rebounding from earlier lows near 96.79.
The price action is currently hovering around the 30-period moving average, having briefly gained momentum following a solid US jobs report (~147,000 jobs added), which temporarily boosted bullish sentiment.
Picture: Dollar finds footing above 97.20 as bulls eye breakout zone, as seen on the VT Markets app.
However, the upward move has since lost steam. The MACD histogram has flattened, and the short-term moving averages (5, 10, and 30 periods) are converging—indicating a potential slowdown in bullish momentum.
For upward continuation, a decisive break above the 97.40–97.47 range is critical.
A breakout here could set the stage for a test of 97.70, with 98.00 as the next resistance, assuming no significant macroeconomic headwinds emerge.
On the downside, a drop below key support around 97.15–97.20—which has been tested several times today—could increase the risk of a pullback toward 96.80, and potentially down to 96.50 if selling pressure persists.Publication date:
2025-07-09 10:47:08 (GMT)
