SOFR OPTIONS: Midday SOFR Calls

• Amid another relatively contained session for G10 currencies, the short-term narrative of post-Fed dollar weakness can be seen by the surge in precious metals on Wednesday. Spot gold has rallied over 4% on the session, reaching as high as $4,265/oz. This dynamic, alongside a steady USD index at 99.75, will keep the focus on any renewed downside to last week’s 99.42 low for the DXY.
• The Kiwi is a relative underperformer on the back of a higher-than-expected unemployment rate in Q2, although firmer employment change headline figures provide an offsetting factor here. NZDUSD has merely reversed yesterday’s risk-fuelled rally, dipping back into modest negative territory this week. Solid trendline support now comes in around the 0.5800 mark, drawn from the June 26 low.
• The bearish lean for the dollar did result in a pop higher for EURUSD, which came within 2 pips of the post-Fed highs at 1.1559. The recent recovery has resulted in a breach of both the 20- and 50-day EMAs, and today’s price action has seen the pair breach the next key S/T hurdle at 1.1537, a trendline resistance drawn from the Apr 17 high. A clear break would highlight a stronger bull cycle, with the next topside resistance located at 1.1587, the 50.0% retracement of the Apr 17 - Jun 24 bear leg.
• EURCHF remains an interesting chart, with an early rally for the pair falling just shy of the year’s highs at 0.9350, a key short-term obstacle to a more protracted recovery. Levels on the topside include 0.9396 and 0.9457.
• Wednesday’s USDJPY range has failed to break out of the Tuesday extremes so far, as the market consolidates following the significant volatility seen late last week. Overall, a bearish threat remains very much present, especially while the pair remains below the bull channel base which broke last week, drawn from the Feb 12 low. 

• MNI interviews ISM services chair on sector outlook -- On MNI Policy MainWire now, for more details please contact sales@marketnews.com

*IRAN: NEW OMAN DEAL TO CLOSE TEMPORARY HORMUZ SHIPPING ROUTES - bbg