Hello traders, and welcome to Wednesday’s market commentary. The middle of the week starts with a light macroeconomic calendar, but plenty of market-moving headlines and developments that keep volatility alive. The main narrative remains the renewed trade tensions between the U.S. and China, which continue to cast a shadow over global sentiment. In his latest comments, Donald Trump reignited diplomatic friction by accusing China of acting in an economically hostile manner, specifically mentioning that Beijing is not purchasing soybeans from the U.S.. This surprising focus on agricultural products such as soybeans and cooking oil adds another layer of unpredictability to an already complex geopolitical landscape — and as we’ve seen in the past, such remarks can ripple through commodity and currency markets alike.
While the macro calendar is quiet, the earnings calendar is packed. Yesterday, we had a busy session for corporate results, especially among major U.S. banks and blue-chip companies. JP Morgan, Wells Fargo, Goldman Sachs, BlackRock, Citigroup, and Johnson & Johnson all published their quarterly earnings. Interestingly, while all major banks reported earnings and revenue above expectations, their stock reactions were mixed. JP Morgan and Goldman Sachs each dropped around 2%, while Wells Fargo surged 7%, BlackRock gained 3%, and Citigroup rose almost 4%. Johnson & Johnson, meanwhile, ended the day flat despite stronger results. Today, earnings season continues with more banking giants — Bank of America and Morgan Stanley — set to publish their results before the market opens, likely setting the tone for Wall Street’s session.
On the currency front, today could be pivotal for the U.S. dollar. The greenback is approaching major technical levels, and traders are watching closely to see whether it will be defended or break lower. EUR/USD is sitting right at a key resistance area, while USD/JPY and the U.S. dollar index (DXY) are testing important supports. A decisive move today could set the tone for the remainder of the week. Elsewhere, the Australian dollar and Japanese yen are both showing strength, and we also see a firm tone in European currencies, led by the British pound. Even emerging market currencies, including the Polish zloty, Czech koruna, and Norwegian krone, are holding up relatively well. Meanwhile, North American currencies, especially the U.S. and Canadian dollars, are struggling to gain traction.
Turning to the commodities market, oil prices are attempting to rebound, but momentum remains weak. Yesterday’s move higher was modest — a retracement of roughly 50% of the earlier decline — so for now, it looks more like a technical correction than a genuine reversal. Gold and silver, on the other hand, are continuing their relentless climb toward new all-time highs, as investors seek safety amid political and economic uncertainty. Metals remain one of the strongest performing sectors this month. In the crypto market, both Bitcoin and Ethereum made small recovery attempts on Tuesday but are now moving sideways as traders wait for clearer direction heading into the midweek session.
Overall, Wednesday opens with mixed sentiment — optimism from strong corporate earnings, tension from renewed trade concerns, and indecision in major currency pairs. Traders should keep an eye on the U.S. dollar’s key support zones and the upcoming bank earnings, which are likely to dictate market direction for the rest of the day.