Track market-moving stories before they get noisy

Daily US Dollar Index (DXY) The U.S. Dollar Index hit 101.47 Wednesday after reaching 101.61 Tuesday. It slipped toward 101.23 after PCE. The broader move is still in place, with the index holding above the 100.56 breakout level. Its 50-day moving average is down near 99.91.

Dollar buyers are taking some profit after a fast run higher. They haven’t left the building. Silver’s rebounds keep running into a currency market that still favors the greenback, and the greenback is still trying to print new highs.

Friday’s Jobs Report Gets the Last Word on October ADP came in stronger than expected. Private employers added 90,000 jobs in September against a 68,000 estimate. That’s not enough to settle the Fed debate, however, the hawks walk into Friday with an argument they didn’t have Tuesday.

PCE moved the October debate. The bigger question is untouched, which is whether inflation and hiring are both cooling enough for the Fed to pause. ADP didn’t help that case.

What to Watch Friday’s jobs report is the next catalyst. PCE cut October hike odds, but it did not pull the 10-Year meaningfully away from its high. Silver needs payrolls to finish the rate-relief trade.

A weaker jobs number could pressure Treasury yields and bring buyers back through $61.04. A firm report would keep the rate trade intact and leave Tuesday’s $60.30 low exposed.

The main trend remains down on the daily swing chart. Silver failed at $61.73 after PCE and was back on the 50% retracement at $60.84 by 14:24 GMT. Buyers defended this area Tuesday; a break through $60.30 would show they could not do it twice.

More Information in our Economic Calendar.

GBP/AUD: Wave four triangle could lead to another decline [Video]

Silver Miners (SIL) looking for a double correction

Gold rebounds from a major trend line after softer PCE inflation data, but elevated rates and upcoming U.S. jobs data keep the broader outlook uncertain.

Gold Technical Analysis

Daily candlestick chart of Gold showing price rebounding from major trendline support toward the 4,222.4 level. Gold markets gapped higher to kick the Wednesday session off. At this point in time, the market is one that I’m watching very closely because interest rates are drifting sideways as the market gaps to the upside, bouncing off a major trend line. All things being equal, this is a market that more likely than not will continue to be a noisy one, as there are so many moving pieces when it comes to influence.

Gold Price Forecast

Every new Gold analysis as it publishes, today's technical signal and key levels, live price — on one page.

See all Gold forecastsThe demand area underneath continues to be an area that I watch as well. With interest rates being so elevated, it does work against the value of gold. But quite frankly, this is a market that, no matter how you slice it, is a little oversold in the short term.

We do have a lot of economic announcements to pay attention to. The first one would be the PCE numbers on Wednesday, but we also have the jobs number coming out on Friday, which could give us an idea of whether inflation is going to rise or fall. It’s hard to tell at this point in time.

PCE a Little Weaker Than Anticipated For what it’s worth, the PCE numbers did come in a little lower than anticipated, but GDP is hotter. So whether or not that makes a difference, we’ll just have to wait and see. But it certainly looks like we’re at least trying to recover.

Ultimately, this is a market that I think is still trying to find a bigger move. With this, most traders are looking at this from a short-term perspective more than anything else, as we bounce around between two sideways consolidation areas.

If you’d like to know more about how to trade gold and silver, please visit our educational area.

Chris is a proprietary trader with more than 20 years of experience across various markets, including currencies, indices and commodities. As a senior analyst at FXEmpire since the website’s early days, he offers readers advanced market perspectives to navigate today’s financial landscape with confidence.

Latest news and analysis

EUR/GBP: Range set to persist – Rabobank

Pound Sterling Price News and Forecast: GBP/USD with no momentum, more sellers

What is driving the US Dollar to multi-month highs against the Euro as PCE data approaches?

The dollar was bouncing back at the time of writing, after it had eased overnight on the back of some weaker-than-expected economic data yesterday which had prompted markets to scale back expectations of an October Fed rate hike. However, with more significant US data due today and Friday, and with oil prices continuing to remain elevated, the dollar’s broader direction remains bullish. Against this backdrop, the near-term risks to our EUR/USD forecast remains titled to the downside, especially with growing signs of stagflation emerging in Europe.

Eurozone data reinforce stagflation concerns
The EUR/USD broke below its summer lows yesterday before recovering some ground this morning. While dovish-leaning remarks from ECB President Christine Lagarde have added to the euro’s woes, the recent decline has been undoubtedly driven predominantly by dollar strength rather than any fundamental deterioration in the single currency.

However, this morning’s economic releases from the eurozone have done little to improve the outlook, with a combination of rising inflation and weakening sentiment reinforcing concerns about stagflation. The renewed recovery in oil prices, amid a lack of progress in US-Iran negotiations, adds another complication for the region’s economic outlook.

French inflation accelerated sharply to 3.0% in September, well above expectations, largely reflecting higher energy prices. The renewed inflationary pressure threatens to erode household purchasing power just as consumption is weakening, while higher borrowing costs are adding to the country’s fiscal challenges.

Germany offered a somewhat more encouraging labour market picture, with unemployment falling by 67,000 in September, taking the number of unemployed to just below 3 million for the first time since June. However, regional inflation readings suggest that German CPI is also picking up, with the national rate potentially returning to around 3.1–3.2%.

Italy’s figures were more concerning. Consumer inflation surged to 4.2% year-on-year in September, up from 3.3% in August and significantly above the 3.8% consensus forecast. At the same time, consumer confidence deteriorated sharply, while business sentiment weakened as renewed caution in the services and construction sectors outweighed a modest improvement in manufacturing.

Taken together, the latest figures highlight the eurozone’s increasingly difficult trade-off between containing inflation and supporting an economy already showing signs of strain, keeping the EUR/USD forecast bearish.

Dollar supported by yields as markets await US data
Yesterday’s disappointing consumer confidence and JOLTS figures weighed on the greenback, although the resulting decline in front-end yields was relatively modest. Today’s ADP employment report and PCE inflation data should provide further clues on the Fed’s next move, with nonfarm payrolls to come on Friday.

Meanwhile, the sharp sell-off in longer-dated US Treasuries continues to weigh on global risk appetite, offering underlying support to the dollar. This is likely to limit the scope for a meaningful correction in the greenback, even if incoming data disappoints.

Attention now turns to September ADP employment and August personal spending and PCE inflation. Core PCE inflation is expected to accelerate from 0.2% to 0.3% month-on-month. Although PCE is the Fed’s preferred inflation gauge, markets may place greater emphasis on the September CPI report due in a couple of weeks. Nevertheless, a stronger-than-expected core PCE reading could push October rate hike pricing higher again.

Technical EUR/USD forecast and key levels to watch
Source: TradingView.com
The EUR/USD has met its main downside target i.e., liquidity below the summer lows of around 1.1325. Will it decline further remains to be seen and will depend pretty much on the bond markets. From a technical perspective, a potential closing break below 1.1325 could see the pair start its next leg lower towards the 127.2% Fibonacci extension level of the last upswing that begun in June, at 1.1220. Resistance is now seen at 1.1360ish and then 1.1410 area, followed by 1.1500.

GBP/USD fell to 1.3228 on Wednesday, with the pound remaining at three-month lows. Investors continue to favour the dollar amid growing expectations of a Federal Reserve rate hike as early as October, while the Bank of England is not expected to change policy until November.

High oil prices are also supporting the US dollar. Negotiations to resume full operations at the Strait of Hormuz have stalled, heightening inflation risks, strengthening expectations of further Fed tightening, and increasing demand for the US currency as a safe-haven asset.

In the UK, markets estimate the likelihood of a 25 basis point Bank of England rate hike in November at over 80%. By mid-2027, approximately four increases are already priced in. However, weak growth in the British economy during 2026 and early 2027 may limit the regulator’s ability to tighten aggressively.

Bank of England Deputy Governor Dave Ramsden stated that he would support further rate hikes if inflationary pressures persist. His stance aligns with recent warnings from Andrew Bailey.

Earlier this month, the MPC voted 6 to 3 to keep rates at 3.75%, while warning that inflation could climb to around 4%.

Technical Analysis

On the H4 chart, GBP/USD maintains a steady downward structure. Following the completion of the previous correction, the market formed another downward impulse and reached the 1.3202 area. The subsequent recovery was capped at 1.3232, which remains a local corrective leg within the broader bearish trend. The price remains below the downward dynamic resistance, and the sequence of lower highs confirms continued selling pressure. The nearest resistance is the 1.3232–1.3238 range. As long as the market holds below this zone, the baseline scenario remains a continuation of the decline towards 1.3175. After a possible interim correction, the next target is 1.3127, and if momentum strengthens, 1.3081. The MACD is positioned in negative territory. Despite the local shrinking of the negative histogram, the indicator’s position below zero supports the medium-term downward scenario.

On H1, the correction also remains limited. Following the decline, the market formed a recovery to 1.3236, but there was no consolidation above resistance. The current structure allows for the formation of another downward wave, initially towards 1.3202 and then to the key intraday support of 1.3175. The Stochastic oscillator has turned down from the upper part of its working range: the signal lines are below the 80 level and pointing towards the central 50 mark. This indicates a weakening of the local corrective impulse. Should selling pressure persist, the oscillator’s move towards the 20 region would correspond with the development of the main downward wave. Cancellation of the priority scenario would require a sustained consolidation of GBP/USD above 1.3238, followed by a move towards 1.3270.

Conclusion GBP/USD remains under pressure at three-month lows, with sellers firmly in control as the dollar benefits from October Fed rate hike expectations, elevated oil prices, and stalled Strait of Hormuz negotiations. While markets price in over an 80% chance of a November BoE hike, the UK’s weak growth outlook may limit the central bank’s ability to tighten aggressively. Deputy Governor Ramsden’s hawkish comments align with Bailey’s recent warnings, but the pound has yet to find meaningful support. Technically, the pair remains bearish below the 1.3232–1.3238 resistance zone, with a continuation of the decline towards 1.3175, 1.3127, and potentially 1.3081 likely in the near term. A sustained break above 1.3238 would be required to shift the short-term outlook.

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Summary:

AUD/JPY's drop for six straight seasons and near six-month lows fall mostly comes from a weak Australian dollar, driven by soft CPI numbers and cautious RBA signals, rather than a strong yen. The yen itself has gotten some selective boosts from Bank of Japan rate-hike talks and intervention warnings. These developments only made the pair's slide worse. With conditions oversold, there might be opportunities for tactical long positions. The AUD/JPY currency pair fell for six trading days straight, hitting a six-month low around 109.40-109.50 today. Earlier this month, the pair dropped sharply from above 114. This move stems from several factors market participants are watching closely.

Figuring out where this pair goes next means analysts must determine if the current downtrend is mostly due to a weaker Australian dollar, a stronger Japanese yen, or a mix of both.

Making Sense of the Aussie’s Slump A few things have weighed on the AUD/JPY lately. The Australian dollar faces lower expectations, while the yen sees steady safe-haven demand.

The Australian dollar was sold off sharply after domestic inflation numbers were weaker than expected. This made markets less hopeful the Reserve Bank of Australia (RBA) would raise interest rates anytime soon.

Also, slower economic growth data from key regional trading partners has squeezed commodity-linked currencies. That’s sent the AUD/USD toward important multi-month support.

Looking at inflation, Australia’s monthly Consumer Price Index (CPI) climbed only 0.4% in August, a dip from July’s 1% jump. While the annual rate did climb to 4%, the monthly figure dampened hopes for more monetary tightening. Labor market data also added to this picture, with unemployment hitting 4.6% in August.

Meanwhile, the yen’s been consistently strong. Its strength stems from Bank of Japan (BoJ) policy signals and warnings against the currency falling too much. The BoJ hiked its policy rate to 1.25% in early September.

Japanese officials’ recent statements, alongside coordinated messages from the United States, point to more policy tightening or currency support measures coming soon.

Outlook For the Coming Weeks What happens next depends on upcoming economic data. Market sentiment will react to Australia’s latest inflation and job figures, China’s economic activity (which affects commodity currencies), and any new remarks from the BoJ or Japanese officials.

Global risk appetite is also important. The AUD/JPY pair often moves with shifts in investor confidence for riskier assets and carry trade dynamics.

Traders watching specific events will pay close attention to the CPI release on October 28th. If inflation is higher than expected, it could rekindle talk of RBA rate hikes and squeeze short positions. But lower inflation would only confirm the current downward trend.

Market opinions on the RBA’s next step are split. Admiral’s figures show traders see about a one-in-three chance of another rate increase. Meanwhile, Paul Bloxham at HSBC expects a hike in the fourth quarter, probably in November.

For the AUD/JPY pair to really recover, we’d probably need clearer signs of a more hawkish RBA or less support for the yen. Until that happens, any gains will likely be temporary corrections within the broader downtrend that started after its late August peak.

Is the AUD/JPY decline mainly from Australian dollar weakness?

Yes, it mostly is. Soft Australian CPI data and cautious guidance from the RBA have pressured the Aussie. Only a small part of this change comes from actual yen strength.

What role has the Japanese yen played in the slide?

The yen has found support from expectations of a BoJ rate hike and official warnings about intervention. This has made the pair’s decline even bigger than what we’d see from just AUD weakness.

What is the main risk for sellers?

Sellers face a few risks. If Australian CPI data comes in hot, it could revive bets on an RBA hike. Also, a dovish shift from the BoJ could cause sharp rebounds; sellers should manage that risk carefully.

Gold multi-dimensional structural breakdown — Multi-tiered supply echelons

Gold has recovered towards $4,200, but UBS’s December forecast of $4,600 still requires a gain of almost 10% from current levels. Gold’s sharp September retreat has left a much steeper climb to UBS’s $4,600 year-end forecast, even as bullion recovers some of Monday’s losses.

The Gold price (XAU/USD) edged up 0.20% to around $4,195 an ounce on Wednesday morning, following Tuesday’s 1.49% rebound.

Monday’s 3.20% decline had taken the closing price to roughly $4,125, and bullion remained nearly 6% lower for September through Tuesday.

Rising yields and a stronger Dollar drove the selloff, increasing the opportunity cost of holding an asset that pays no interest.

Wednesday brought some relief as Treasury yields eased and investors scaled back expectations for an October Federal Reserve hike.

UBS’s forecasts, dated 24 September, put gold at $4,600 in December 2026, $5,000 in March 2027, $5,200 in June and $5,400 in September.

That implies gains of approximately 9.7% by year-end and 28.7% by September 2027 from today’s price.

Those projections predate Monday’s slide, rather than representing a fresh response to it.

Image: Gold price chart vs USD shows recovery over last 2 days UBS’s earlier argument gives more weight to reserve diversification and investment demand than to the next interest-rate decision alone.

In its earlier September assessment, the bank said: “We view gold as a strategic portfolio hedge and diversifier, rather than as a tactical expression of the next Fed decision.”

UBS strategist Giovanni Staunovo also wrote on 17 September: “We believe the long-term investment case for gold remains positive,” pointing to central-bank purchases as structural support.

The immediate test is whether softer rate expectations persist through the next US inflation and employment releases.

Stronger figures could lift yields again and test whether central-bank and investment demand can offset renewed pressure on bullion.

Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.

Image © Adobe Images

A yawning rate gap and firm energy prices keep the pound climbing against the krona.The pound-to-Swedish krona exchange rate extends a seemingly relentless climb to reach 13.2344 on Wednesday, extending a rally that has run almost without interruption since June.

The pair reached 13.2483 in early trade, clearing the mid-September highs near 13.20 and taking the advance from June's 12.55 to more than 5%.

The rally has come without a meaningful correction, and the pullbacks that have occurred have been shallow and quickly bought.

The late-September dip held near 13.07, above the rising 21-day moving average, before the pair pushed on to fresh highs:

Swedish Krona Issued A Red Card in a World of CarryThe rise owes more to krona weakness than to pound strength.

The krona is the worst-performing G10 currency of 2026, down against every major currency, and the pound ranks only mid-table among the currencies that have outperformed it.

The krona is down 6.3% against the pound this year, 12.05% against the Norwegian krone and 7.59% against the US dollar.

Even the Swiss franc, among the weaker major currencies this year, has gained 2.91% on the krona.

"We underestimated the robustness in energy prices which both weighs on SEK and reduces investor appetite to rotate into lower yielding but cyclically sensitive currencies," says a research note from Morgan Stanley.

The two burdens Morgan Stanley identifies are energy and yield, and the second is the heavier.

The Riksbank's policy rate stands at 1.75%, against 2.50% for the European Central Bank's deposit rate and 3.75% for Bank Rate at the Bank of England.

That leaves the krona 200 basis points short of the pound in yield terms, a gap that makes it a funding currency in a market that rewards carry.

The krona now trades with shades of the Japanese yen: both central banks are preparing to hike, but from a base so low that markets judge the gap too wide to close.

Rate differentials across the G10 are moving the wrong way for the krona, with the Federal Reserve, the ECB and the Reserve Bank of Australia all hiking this year and the Bank of England widely expected to follow in November.

Nordea notes that central banks around the world are raising rates, putting pressure on the krona.

The Norwegian krone's 12% outperformance of the krona this year reflects that preference, with Norway's oil exports turning higher energy prices into support for its currency.

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A Hawkish Riksbank Isn't Moving the DialThe Riksbank is signalling it is ready to raise rates. Minutes from the September policy meeting, published on Wednesday, show two Executive Board members, Governor Erik Thedéen and Anna Seim, favouring a hike at the November meeting.

"The minutes confirm a rate hike most likely in November," says Anna Westlund, Senior Economist at Nordea.

The Riksbank's rate path implies a 65% probability of a November hike and a 40% probability of a further move in February.

Swedbank expects hikes in both November and February, taking the policy rate to 2.25%.

Even that path would leave the Riksbank below the ECB's current deposit rate and 150 basis points beneath a Bank of England that is itself expected to hike.

The krona has not responded, suggesting the rates gap is simply too large, at present, to shift the dial in SEK's favour.

Energy Adds to the BurdenUnlike Norway, Sweden isn't blessed with an abundance of hydrocarbons, which matters during an energy crisis in which fuel importers are naturally penalised.

"Should energy prices conclusively decline, that may be the signal to buy SEK, but it's probably too early at this point, with NOK looking like a much more appealing Scandi alternative," says Morgan Stanley.

Brent crude trades near $103 a barrel, having held above $100 through most of September on disruption in the Strait of Hormuz.

The Riksbank board is alert to the risk.

Thedéen notes that the Riksbank's forecast assumes both a fall in petroleum product prices and that the weakening of the krona is temporary, assumptions Nordea says have proved wrong in the past.

Deputy Governor Per Jansson highlights the weaker krona as an added risk to inflation.

Quarter-end flows offer the krona only limited relief, with SEB's model indicating that Swedish portfolio managers have some need to buy krona into Wednesday's close.

Until energy prices break lower and the rate gap starts to close, the path of least resistance for the pound-to-krona rate points higher, with the 21-day at 13.10 the level that keeps the uptrend intact.

TL;DR: Sterling’s rally started before today’s stronger UK GDP data—markets now price an 89.2% probability of a November BoE hike and a terminal rate near 4.86%, with GDP confirming the hawkish repricing already underway rather than triggering it.

Why This Matters It’s tempting to credit a strong data release for a currency’s rally on the day it lands, but the sequencing here tells a different story. Sterling was already moving on central bank signaling before GDP confirmed it, and understanding that order matters for how durable the move is likely to be. The same energy-inflation shock pushing the BoE toward more hikes now is also the one economists warn could weaken demand and squeeze fiscal policy later—which is why this reads as a strong week for Sterling, not yet a new multi-week trend.

Sterling’s Rally Started Before the GDP Beat Sterling is posting its broadest gains of the week, but today’s stronger UK GDP data is better understood as the latest confirmation of a BoE repricing already underway, rather than the origin of the move.

The sequence matters. Bank of England Governor Andrew Bailey first highlighted the difficulty of maintaining unchanged policy if persistently high energy prices continue to lift inflation pressure. Deputy Governor Dave Ramsden then went further on Monday, explicitly leaving open the case for another hike if upside inflation risks keep building. Sterling rebounded from recent lows as markets moved aggressively toward a November increase.

Today’s GDP revision landed on top of that already-forming policy story. Markets now assign around an 89.2% probability to a November hike, with the implied post-meeting rate at roughly 3.97% against the current 3.75%. That equates to about 22 basis points of tightening priced for the meeting, almost a full 25bp increase.

The key point is therefore not that GDP suddenly turned Sterling bullish. GDP confirmed the Sterling trade. It did not create it.

November Is Nearly Priced, but the Curve Goes Much Further The repricing is also much broader than a one-and-done November move. Market pricing implies around 1.5 cumulative hikes by December, roughly 2.4 by February 2027, around 3.7 by April, and approximately 4.5 by September 2027, taking the implied terminal rate toward 4.86%.

That is a substantial shift in the expected policy path. But the curve is not pricing a simple sequence of back-to-back hikes. Per-meeting probabilities dip at several points, including around March and June, implying a more measured hike-then-pause pattern rather than uninterrupted tightening at every meeting. That distinction matters because it suggests markets are not betting on a rapid emergency tightening cycle. Instead, they are increasingly pricing the idea that inflation persistence may require the BoE to deliver multiple additional adjustments over time.

The energy shock sits at the centre of that repricing. Bailey and Ramsden have both emphasized the inflation risk created by persistently high energy prices, tying the UK story into the same oil-driven inflation theme already running through the Fed, RBA and broader global rates outlook.

GDP Confirms Resilience, but Trade Did Much of the Heavy Lifting The revised GDP numbers give the BoE hawks more room to argue that the economy can withstand tighter policy. UK GDP growth in Q2 was revised from 0.4% to 0.5% q/q, following an unrevised 0.6% expansion in Q1. GDP is now estimated to be 2.0% above its Q4 2024 level, revised up from 1.9%. The first-half growth profile is therefore stronger than previously thought. But the composition deserves more attention than the headline alone.

On the output side, growth was relatively broad, with services up 0.6% and construction up 0.8%, while production slipped 0.1%. On the expenditure side, however, growth leaned much more heavily on net trade. Export volumes rose 2.8%, sharply revised from the initial 0.5% estimate, with goods exports up 3.7% and fuels making an important contribution. Household consumption increased only 0.3%, while government consumption fell 0.5%. That makes the GDP beat supportive, but not a picture of uniformly strong domestic demand.

Public-Sector Weakness Was Partly Distorted by the Heatwave The fall in government consumption also needs some context. The ONS attributed part of the weakness to the June heatwave, which forced school closures and contributed to a 0.4% fall in education output, the largest negative sector contribution. That makes the public-sector drag less useful as evidence of underlying demand weakness.

Business investment was also encouraging, rising 5.2% y/y, while gross fixed capital formation more broadly increased 0.9% q/q and 3.1% y/y. Those figures should be kept distinct, but together they reinforce the broader point that parts of the private economy remain resilient even as household spending growth remains comparatively modest.

Household Incomes Recover, but Consumers Are Still Cautious The household data also improved. Real household disposable income per head rose 1.0% q/q, the strongest increase since late 2024, after falling 0.8% in Q1. But households did not immediately translate all of that improvement into stronger consumption.

The saving ratio increased from 8.6% to 8.8%. Within that, non-pension saving rose from 3.8% to 4.5%, while the pension component declined from 4.8 percentage points to 4.3 points. That suggests households had more real income available in Q2, but still retained a cautious stance. The result is another reason to describe the GDP data as resilient rather than booming.

The Same Inflation Shock Creates a Q4 Problem There is also a growing tension between the factors supporting Sterling now and the factors that could constrain the economy later. The same energy-price shock driving the BoE toward a more hawkish stance is also threatening household purchasing power and increasing pressure on public finances. General government net borrowing rose from 4.2% of GDP in Q1 to 5.2% in Q2, giving the fiscal side of the story considerably more weight ahead of the October 28 Budget.

Economists cited in the handover have warned that the resilience visible through the first half may fade into Q4 as inflation erodes real income growth and the government faces pressure to tighten fiscal policy. That creates a genuine two-sided Sterling story: near term, persistent inflation and resilient activity support higher BoE rates; further out, the same inflation shock may weaken demand and increase the risk of fiscal tightening. The forces supporting Sterling now could therefore become the forces constraining growth later.

ActionForex’s Technical View on EUR/GBP and GBP/CHF EUR/GBP Tests the 0.8551 Breakdown Point

The technical picture in EUR/GBP is increasingly aligned with the fundamental divergence.

The pair is pressing 0.8551 support after repeatedly failing around the 0.8610–0.8611 resistance cluster.

That area combines former support turned resistance, the 38.2% retracement of the decline from 0.8863 to 0.8453, and the weekly 55 EMA. Price also remains contained within the broader medium-term falling channel.

A firm break below 0.8551 would suggest that the rebound from 0.8453 completed at 0.8611 as a corrective move only.

That would bring the 0.8453 low back into focus, with nearby 0.8466 marking the 61.8% retracement of the 0.8221–0.8863 advance.

A decisive break through that support zone would materially raise the risk of a medium-term retest of the 0.8221 low.

For now, the bearish EUR/GBP case remains favored while 0.8611 resistance holds.

GBP/CHF Presses 1.1066 as Sterling Strength Broadens

GBP/CHF offers the complementary bullish Sterling setup.

The rebound from 1.0898 has extended back toward 1.1066 resistance, while the daily 55 EMA has provided solid support underneath the move.

A firm break of 1.1066 would resume the broader advance from 1.0281 and could also force a break through the upper boundary of the rising channel.

That would expose 1.1142, the 61.8% retracement of the decline from 1.1675 to 1.0281.

A sustained break above 1.1142 would strengthen the case for a larger return toward the 1.1675 high.

Near term, the bullish setup remains intact while 1.0898 support holds.

Taken together, a EUR/GBP breakdown and GBP/CHF breakout would provide stronger evidence that Sterling strength is becoming broad-based rather than remaining confined to one bilateral pair.

Strong Sterling Setup, but Not Yet a New Multi-Week Trend For now, fundamentals and technicals are aligned. Sterling is outperforming broadly. Markets are pricing a much steeper BoE path. GDP has been revised higher. EUR/GBP is pressing support, while GBP/CHF is testing resistance. But the durability of the move is not yet guaranteed.

The current Sterling advantage rests partly on the same energy-driven inflation shock that could later weaken household demand and increase fiscal pressure. That makes this a strong week for Sterling, but not yet sufficient evidence of a durable new multi-week trend. The immediate policy case is becoming more hawkish. The medium-term growth cost of that hawkishness is only beginning to emerge.

Key Takeaways Sterling’s rally was underway before today’s GDP data, driven by hawkish BoE signaling from Bailey and Ramsden that pushed November hike odds to 89.2%. Rate markets now price a terminal rate near 4.86%, with a measured hike-then-pause path rather than back-to-back tightening. Q2 GDP was revised up to 0.5% q/q, but the beat leaned heavily on net trade (exports +2.8%) rather than household consumption (+0.3%). Rising fiscal pressure—net borrowing up to 5.2% of GDP—puts extra weight on the October 28 Budget as a potential constraint on the story. EUR/GBP is testing 0.8551 support and GBP/CHF is testing 1.1066 resistance; breaks in both would confirm Sterling strength is becoming broad-based.

ActionForex

ActionForex.com was set up back in 2004 with the aim to provide insightful analysis to forex traders, serving the trading community for two decades. We started providing only a daily and a mid-day report, now known as Action Insights. Gradually, we added a lot more in-house contents to the site. Technical Outlook section was expanded to cover more pairs. In addition to that, Top Movers, Heat Map, Pivot Point Charts and Pivot Meters, Action Bias and Volatility Charts, are tools used by traders from all over the world.

Silver price today: Silver falls, according to FXStreet data

GBP/USD with no momentum, more sellers

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Summary:

Strong U.S. economic growth and higher Treasury yields have put the Federal Reserve in a more hawkish stance, widening interest rate differentials over European assets The EUR/USD's fall to 14-week lows mainly reflects economic fundamentals, even though daily momentum indicators now show oversold technical conditions. A quick reversal appears unlikely without softer U.S. data or clearer signals that the Fed will pause. Any rebound will likely be modest as long as the broader downtrend continues. The euro had a tough month, with EUR/USD falling for three straight weeks. The pair hit its lowest point since late July, near 1.1360, quite a drop from its August high over 1.1700. This left many wondering if the recent selling pressure went too far.

Market factors do seem to support the downtrend, but the speed of the fall deserves a closer look.

Why the Dollar Is Winning The dollar’s strengthening is a main driver here. Markets largely expect another Federal Reserve interest rate hike at its next policy meeting, with roughly a 70% chance or more. Strong US economic data and Treasury yields, consistently over 5% on longer-term maturities, support this outlook.

US producer prices climbed 5.4% year-on-year in August, adding to expectations for more Fed rate hikes. The European Central Bank’s quarter-point rate increase on September 10 then had little effect on the euro and the dollar’s strength simply overshadowed it.

After September’s rate hike, which pushed the federal funds rate to 3.75%-4.00%, expectations for further Federal Reserve monetary tightening solidified.

Europe faces its own economic headwinds. As a net energy importer, the region has been hit particularly hard by the Middle East conflict. For instance, Europe’s headline inflation rose to 3.3% in August, with energy prices climbing 14.3%.

Is this Justified or Overdone? The euro’s recent drop seems mostly due to widening interest rate differences between the US and the Eurozone, plus the dollar’s renewed strength.

Eurozone economic data hasn’t worsened enough by itself to explain such a big currency shift. Instead, markets are now focused on strong US economic growth, higher Treasury yields, and ongoing geopolitical worries.

But some indicators suggest the recent sell-off might have gone too far. Technically, EUR/USD shows a daily Relative Strength Index (RSI) nearing 25.85 on its current daily chart.

This oversold level suggests the decline might be hitting its short-term bottom. Current market behavior seems to worsen the euro’s existing economic disadvantages instead of creating new ones.

Could We See A Near-Term Reversal? Upcoming economic data, like US inflation reports, Eurozone price index readings, and more comments from central bank officials, will be key to figuring out whether the dollar keeps climbing. A string of weaker US economic data or clearer signals from the Federal Reserve about potentially pausing rate hikes could spark a recovery rally for the euro.

For the current EUR/USD trend to truly reverse, it’ll likely need more than just good Eurozone economic numbers or careful statements from the ECB. Without those clear catalysts, a lasting upward move in the next few trading sessions isn’t very likely.

Why has EUR/USD fallen for three consecutive weeks?

The US dollar has gotten stronger. This is due to expectations of Federal Reserve tightening, higher Treasury yields, and geopolitical energy risks. These factors simply overshadowed developments in the eurozone.

Are eurozone fundamentals the main cause of the drop?

Not really. The decline mostly shows investors shifting funds into US assets, rather than a sudden, sharp downturn in eurozone economic data.

Is the current EUR/USD decline justified?

Yes, the move makes sense. Different interest rates and the dollar’s overall appeal support this decline. The quick sell-off, however, certainly amplified the reaction.

GBP/USD: Can Stronger UK Growth Offset the Dollar’s Advantage?
GBP/USD is rising modestly on Wednesday but remains close to its three-month low, having fallen more than 2% across September.

Today’s move higher comes after stronger-than-expected UK GDP data, as U.S. dollar bulls pause for breath.

Data from the Office for National Statistics showed that UK Q2 GDP was upgraded to 0.5% in the three months to June, better than the 0.4% growth seen in the first estimate. This follows growth of 0.6% in Q1.

The data confirms that the UK was the fastest-growing G7 economy in the first half of the year, as consumers continued to spend even as the Middle East conflict lifted oil prices and added to inflationary pressures.

The numbers come as a boost for the Labour Party as it holds its annual conference in Liverpool.

Despite solid GDP growth in Q1 and Q2, the outlook for the second half of the year is darkening, with pressures expected to build on businesses and households. Growth is expected to slow to 0.2% in Q3 and Q4 amid a fresh spike in living costs.

U.S. Yields and Fed Expectations Keep the Dollar in Focus

Meanwhile, the U.S. dollar is pulling back from the two-month high reached yesterday as Treasury yields retreat.

U.S. Treasury yields have pulled back from multi-year highs as oil prices fall to a three-week low, following dovish remarks from New York Fed President John Williams, who warned that the central bank did not need to rush its next move.

U.S. data was also weaker than expected, with Conference Board consumer confidence falling to its lowest level since May 2014, while job openings declined more than expected to 7.09 million.

October Fed rate hike expectations have pulled back from 70% to 40%. However, traders are still pricing in more than a 90% probability that the Fed will raise borrowing costs by the end of the year, which could limit any pullback in the U.S. dollar.

U.S. Inflation and Payrolls Could Decide the Next Move

Attention will now turn to U.S. core PCE, the Fed’s preferred gauge of inflation, which is expected to rise 0.3% month-on-month, up from 0.2%.

The data will be accompanied by final U.S. Q2 GDP data, along with more speeches from Federal Reserve officials. U.S. non-farm payrolls will be released on Friday.

Strong data and hawkish Fed officials could see October rate hike expectations rebound, lifting the U.S. dollar and pulling GBP/USD lower.

The key question for GBP/USD is whether stronger UK growth can offset the widening U.S.-UK yield and policy differential.

If U.S. inflation remains sticky and payrolls are stronger than expected, markets could price out the recent pullback in October rate hike expectations. Higher Treasury yields would then support the dollar and put renewed pressure on GBP/USD.

Conversely, weaker U.S. data combined with continued oil price declines could ease inflation concerns and reduce expectations of further Fed tightening. Lower Treasury yields would weaken the dollar and give GBP/USD more room to recover.

GBP/USD forecast - technical analysis

GBP/USD has broken below its rising channel as well as its 50- and 200-day EMAs before finding support around 1.3200. The pair has since recovered slightly and is consolidating around 1.3250, while the RSI has moved out of oversold territory.

The 50 EMA is also close to crossing below the 200 EMA, which would form a bearish death cross.

Sellers will look to break below the 1.3200 support zone to extend the decline towards 1.3100, followed by the psychological 1.3000 level.

On the upside, initial resistance is seen at 1.3275, this week’s high. A break above this level would expose 1.3350, the July 27 swing low, followed by horizontal resistance around 1.3500.

A sustained move above the 50- and 200-day EMAs would put buyers on a firmer footing and bring 1.3500 into focus.

Oil: Supply Recovery Challenges the Geopolitical Premium
Oil prices are drifting modestly higher as President Trump denies that he would be willing to ease sanctions on Iran. Still, gains are muted amid optimism surrounding a recovery in crude supply from the Middle East, which helped pull prices to a three-week low in the previous session.

While Brent is trading above $90 a barrel, the December contract is around $96. Meanwhile, WTI is hovering around $89.

Brent is on track to gain 14% in September, its largest monthly increase since July, while WTI is on track for a more modest 4% rise.

The spread between the two benchmarks is at its widest in four months as markets weigh plans in the U.S. to restrict diesel exports, which could create an oversupply in the U.S. market and lead refiners to produce less crude.

Meanwhile, the picture in the Middle East remains uncertain as Qatar continues its shuttle diplomacy between Tehran and Washington, hoping for a breakthrough.

Although Trump has said he is unwilling to give Iran sanctions relief unless there are concrete steps from Tehran on its nuclear programme, limiting the chances of a diplomatic solution, the impact on oil prices may be limited if crude supply continues to flow.

Crude exports from Middle Eastern producers rebounded in September to 16.32 million barrels per day, the highest since the Iran war began in February. Regional exports are now just 11% below pre-war levels.

That is a remarkable recovery for a region still in conflict. With oil flowing, concerns over supply have eased, putting pressure on prices.

Oil forecast technical analysis

Oil trades in an ascending channel dating back to early July. The price recently ran into resistance at $106.75 before rebounding lower and is currently testing the lower band of the rising channel and the 50 EMA around $89. The RSI is below 50.

Should sellers break below the $89 support zone and the 38.2% Fibonacci retracement of the $55 low to $120 high, sellers could gain traction towards the 200 EMA at $82.50 and the 61.8% Fibonacci retracement at $80. Below here, attention will turn towards $75, the August low.

Should the $89 level hold, buyers will need to rise above $95. The 38.2% Fibonacci retracement above here would bring $100, the psychological level, into focus, followed by $105, the 23.6% Fibonacci retracement.

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Orbex Group Limited is the holding company of Orbex Global Limited, Orbex Limited is an affiliate with Orbex Global Limited. Orbex Global Limited is authorized and regulated by Mauritius Financial Services Commission “FSC” (View License). Orbex.com is owned by Orbex Group Limited and is operated by Orbex Global Limited with registered address: Ground Floor, The Catalyst, Silicon Avenue, 40 Cybercity, 72201 Ebène, Republic of Mauritius

Risk Warning: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange, you should carefully consider your investment objectives, level of experience, and risk appetite. There is a possibility that you may sustain a loss of some or all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts. Orbex Global does not offer its services to residents of certain jurisdictions such as Mauritius, USA, and North Korea.

The Pound-Australian Dollar could remain supported after Australian inflation failed to materially revive near-term RBA hike expectations, while stronger UK GDP offered Pound Sterling some support. The Pound to Australian Dollar (GBP/AUD) exchange rate remained supported on Wednesday after the latest Australian inflation data failed to trigger a sustained recovery in the 'Aussie'.

GBP/AUD had already advanced after Tuesday's Reserve Bank of Australia decision, when the central bank raised interest rates by 25 basis points to 4.60% but struck a less hawkish tone than markets had expected.

DAILY RECAP:

The Australian Dollar (AUD) struggled for traction on Wednesday despite headline inflation accelerating sharply.

Australian consumer prices increased by 0.4% in August, while annual inflation rose from 3.5% to 4.0%.

However, underlying price pressures were less concerning.

Trimmed-mean inflation held at 3.6%, while the monthly underlying increase came in slightly below market expectations.

This prompted investors to reduce expectations for another RBA rate increase in November, with markets pricing only a partial chance of further tightening before the end of the year.

The data followed Tuesday's RBA decision, when policymakers raised rates to 4.60%, their highest level in 15 years.

RBA Governor Michele Bullock said the Board had also considered leaving rates unchanged and suggested that the four hikes delivered this year may already be exerting sufficient restraint on inflation.

This relatively cautious guidance left the Australian Dollar vulnerable to profit-taking and reduced expectations that the RBA will need to tighten policy aggressively again in the near term.

The Pound (GBP), meanwhile, received some support from stronger-than-expected UK growth data.

Final figures showed that the UK economy expanded by 0.5% during the second quarter, revised higher from the previous estimate of 0.4%.

Real household disposable income per head increased by 1.0%, while business investment was also revised sharply higher.

The figures reinforced evidence that the UK economy performed relatively strongly during the first half of 2026.

Prime Minister Andy Burnham's Labour conference speech also attracted attention after he signalled that the government would explore a closer future relationship with the European Union.

Near-Term GBP/AUD Forecast: RBA Hike Bets Remain Key Looking ahead, GBP/AUD could remain supported if investors continue to scale back expectations for another near-term RBA rate increase.

Headline Australian inflation remains uncomfortably high, but the stability in underlying inflation suggests that Tuesday's rate hike may be given time to work through the economy before policymakers act again.

A renewed increase in energy prices or another strong inflation release would still revive the case for further RBA tightening and could provide the Australian Dollar with support.

For the Pound, the stronger final UK GDP figures should provide some protection, although wider market movements and expectations surrounding the October Budget are likely to remain important drivers.

If RBA tightening expectations continue to fade while UK growth sentiment remains resilient, GBP/AUD could retain an upward bias in the near term.

The Euro managed to break below the support trend at 1.1390. If prices hold below the daily close of 1.1410, more of a drop is likely towards the 1.1200-50 zone.

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