Overnight, while the US slept

Risk-on, and not by halves: US equities ripped. The Dow jumped 693 points (+1.3%) to a record close above 53,000, the S&P 500 gained 1.5% to roughly 7,602, and the Nasdaq Composite led with +2.1% to around 25,907. Big Tech and the AI-chip complex did the heavy lifting. That follows a Friday that was already strong, and caps a July that was actually mixed underneath — the Nasdaq fell 3.2% for the month and the S&P slipped 0.13%, snapping eleven straight positive Julys.

Rates & DXY: The US 10-year yield pulled back about 6bp to 4.68% after ending Friday at 4.743% — its highest since January 2025. The 2-year sits near 4.29%. The shape matters more than the level here: through July the 30-year rose 37bp (to the highest since 2007), the 10-year 32bp and the 2-year only 15bp. That is a textbook bear steepener (long-dated yields rising faster than short-dated ones), and it says the bond market is demanding compensation for inflation and supply risk — not pricing rate cuts. The dollar index (DXY — the greenback measured against a basket of major currencies) is struggling just under 100 after three straight losing sessions.

The dominant driver — Iran, and a genuine contradiction: Trump said late Sunday he'd held off the strike "at the request of allies," with the perimeters of a deal agreed including the immediate opening of the Hormuz Strait. Brent slumped $4.11 to $83.82 and WTI $5.22 to $79.45. But Tehran's line is different: Iran says there are no talks under way with the United States and no meetings planned, and that the only Hormuz discussions are with Oman. I'd treat this as a de-escalation headline, not a de-escalation.

Gold: trading 4055.38 / 4055.58. Session range 4019.10–4079.78; prior-day high/low 4111.72 / 4021.18. Apply the framework properly here. The Hormuz threat was a supply-side shock (a disruption that pushes the price of a critical input up) — oil higher, inflation stickier, central banks forced hawkish, real rates (interest rates after subtracting inflation) up, gold pressured. That shock is now partially unwinding, which removes the inflation impulse and drains the safe-haven premium at the same time. Critically, the policy channel is wide open: the Fed held last week under Chair Kevin Warsh, but NY Fed President John Williams said outright that "it would absolutely be appropriate" to raise rates if inflation doesn't come down. Add ISM Prices Paid at 71.1 and there is nothing dovish in the pipeline. So the real-rate brake is engaged, the haven bid is leaking, and gold has already rejected $56 from yesterday's 4111.72 high. My read is lower — but a soft dollar is the offset, which is why I want to sell rallies rather than sell here.

Crypto: Bitcoin 63,629 (RSI M15 47.8, ATR $137.21); session 63,566–63,726, prior-day 64,030 / 62,195. Here's the tell of the morning: equities printed a record and crypto did nothing. Bitcoin actually faded its opening bounce. ETF flows have turned negative, a Coldcard wallet exploit is still weighing on sentiment, and legislation has stalled. Ether 1,866.45 (RSI M15 51.7, ATR $4.37); session 1861.22–1865.57, prior-day 1894.87 / 1824.12 — opened around $1,883, up 2.2%, then gave it all back inside the US morning. A zero-yield asset with a 30-year Treasury at 5.27% is a hard sell, and it's showing.

Key FX:

• EURUSD 1.15102 — RSI 48.2 (neutral), ATR 3.0 pips. Session 1.15068/1.15116, prior-day 1.15589 / 1.15004. Sitting right on the 1.1500 handle and holding it while the dollar bleeds.
• GBPUSD 1.34310 — RSI 46.2, ATR 4.1 pips. Prior-day 1.35061 / 1.34176. Cable is the weakest of the majors against a soft dollar, which tells you something about sterling.
• USDJPY 157.200 — RSI 65.3 (rising, near-term stretched), ATR 10.1 pips. Prior-day 157.886 / 155.226 — a 266-pip range, which is the story. Coordinated intervention is now confirmed: both Trump and Japanese Finance Minister Satsuki Katayama acknowledged the US Treasury stepped in alongside Japan, reportedly buying $5–10bn of yen. The pair was above 163 (a 40-year high) before this and traded down to 156.34 on Monday. It has since crept back to 157.20. This is the single most interesting chart on my screen.
• AUDUSD 0.69981 — RSI 46.8, ATR 2.5 pips. Prior-day 0.70502 / 0.69839. Failed to hold 0.7000 despite the risk rally — soft.
• NZDUSD 0.58644 — RSI 40.3 (weakest reading in the majors), ATR 3.0 pips. Prior-day 0.59083 / 0.58603. Four pips off yesterday's low.
• USDCHF 0.80996 — RSI 43.0, ATR 3.9 pips. Prior-day 0.81155 / 0.80551. The franc is quietly firm, which doesn't quite match the equity record.

Cross-asset snapshot:

Asset	Now	vs Prior Close	Vector
S&P 500	~7,602	+1.5%	Risk-on
US 10Y	4.68%	Falling (−6bp)	Marginally dovish, but curve steepening
DXY	~99.9	Softer, 3rd down session	USD weak
Gold	4,055	−$56 from prior-day high 4,111.72	Bearish — haven premium unwinding
Bitcoin	63,629	−$401 from prior-day high 64,030	Weak, diverging from equities
Brent	~$83.82	−4.7%	Iran de-escalation

Context: normal full-liquidity session, heavy earnings week, and the market's attention is entirely on Friday's US payrolls. Everything between now and then is positioning.

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