The EUR/USD pair continues to trade within a narrow range, balancing between a modest improvement in market sentiment and the persistent weakness of eurozone economic data.
Possible technical scenarios:
On the daily chart, EUR/USD is recovering within a broader downtrend, consolidating below 1.1589 near the channel’s resistance. From this level, a downward reversal and continuation of the trend toward targets at 1.1494 and 1.1399 remain possible.
Fundamental drivers of volatility:
The muted movement of EUR/USD reflects mixed fundamental signals.
On one hand, weak business sentiment data from Germany is exerting moderate pressure on the euro. The ZEW index showed that investors remain pessimistic about Germany’s economic outlook, even though their assessment of current conditions improved slightly. However, overall sentiment in the eurozone turned out better than expected, which helped cushion the negative impact and lent some support to the currency.
С On the other hand, news of an agreement to reopen the US government slightly improved global risk appetite, supporting the euro and other risk-sensitive assets. Meanwhile, the US dollar saw limited demand as a safe-haven asset but did not strengthen significantly.
Aside from that, diverging opinions among Federal Reserve officials regarding the monetary policy outlook continue to create uncertainty, preventing the dollar from gaining further momentum.
Intraday technical picture:
As we can see on the 4H chart, EUR/USD still has some room to move upward toward the resistance of the descending channel, where a test of that level is possible. That being said, after reaching it, the price is likely to reverse downward, resuming its movement within the prevailing downtrend.
The pound sterling weakened drastically against the US dollar after the release of disappointing UK labor market data, which strengthened expectations for a Bank of England rate cut in December.
Possible technical scenarios:
From the look of things on the daily chart, GBP/USD is testing the 1.3147 level, and it remains uncertain whether the pair can consolidate above it following the recent recovery. The upward correction could extend toward the dotted resistance level at 1.3279 before the pair resumes its decline toward November lows.
Fundamental drivers of volatility:
According to data from the Office for National Statistics, the UK unemployment rate rose to 5% for the three months ending in September, which is the highest level in four years. This exceeded both forecasts (4.9%) and the previous reading (4.8%). Employment dropped by 22,000, marking the first decline since March 2024 and signaling a slowdown in economic activity.
Meanwhile, wage growth moderated to 4.6% year-over-year, excluding bonuses, and 4.8% including bonuses. The combination of a weakening labor market and slowing income growth has fueled expectations of imminent monetary easing, especially after the Bank of England recently softened its stance by removing the word “cautious” from its guidance on the pace of rate cuts.
Additional downward pressure on the pound comes from the relative stability of the US dollar, supported by progress on the US funding bill in Congress and declining expectations of a Fed rate cut in December. The pound also remains vulnerable ahead of upcoming UK GDP data for September and Q3, which could serve as a key catalyst for further price movement.
Intraday technical picture:
Given the unfolding situation on the 4H chart, it remains uncertain whether GBP/USD will hold below 1.3147 and extend its decline toward 1.3010. The pair may continue to trade below 1.3147 for some time, with the possibility of a brief upward correction before resuming its downward trajectory.
The Japanese yen is trading under pressure against the US dollar amid persistent uncertainty about the Bank of Japan’s next policy steps.
Possible technical scenarios:
The daily chart shows that USD/JPY remains confined within a narrow 153.19–154.31 range, trading below resistance. From this level, a downward reversal and continued sideways movement are possible unless new volatility drivers emerge.
Fundamental drivers of volatility:
The Bank of Japan’s recently published policy opinion survey revealed no clear consensus on the timing of the next rate hike. While some officials believe the moment for tightening is approaching, others caution that soft consumer demand and slowing global growth could pose risks to the economy.
Adding to the uncertainty is the arrival of new Prime Minister Sanae Takaichi, who is expected to introduce large-scale stimulus measures. This move could delay any future policy tightening. These factors are limiting demand for the yen.
The currency’s weakness is also being exacerbated by improving global risk sentiment following signs that the US government shutdown may be ending. Investor optimism is reducing interest in safe-haven assets, including the yen. Meanwhile, elevated US Treasury yields continue to support the dollar, keeping USD/JPY above the 154.00 level.
However, the pair’s upside potential remains constrained. Market expectations of another Fed rate cut in December are tempering dollar strength, while the possibility of yen-supporting intervention by Japanese authorities is also restraining movement. As a result, the market remains cautious, and the USD/JPY trend continues to depend heavily on signals from the Bank of Japan and developments in US policy.
Intraday technical picture:
According to the 4H chart, USD/JPY is consolidating below 154.35, which, as before, could lead to a downward reversal within the broader sideways range of 151.53–154.35.
The USD/CAD pair climbed above 1.4000, supported by positive developments in the US and strong expectations that the Bank of Canada will maintain its current policy stance.
Possible technical scenarios:
On the daily chart, USD/CAD remains in an uptrend, having pulled back from resistance and entered a corrective phase. The price is currently holding near 1.4013, but if this level fails, the decline could extend toward the lower boundary of the channel, around the dotted support line at 1.3924.
Fundamental drivers of volatility:
The US dollar strengthened after the Senate approved a funding bill, paving the way to end the longest government shutdown in history. President Donald Trump’s backing of the bipartisan agreement boosted investor confidence in the imminent resumption of federal operations, improving overall market sentiment and supporting the dollar.
Meanwhile, the Canadian dollar received limited support from solid labor market data. In October, the unemployment rate fell to 6.9% from 7.1% in the previous month, while the economy added 66,600 new jobs. These figures reinforced expectations that the Bank of Canada will keep its key rate at 2.25%, allowing previous rate cuts to continue supporting the economy.
Despite this, the stronger US dollar remains the dominant driver, as the divergence in monetary policy expectations between the US and Canada supports the prevailing uptrend in USD/CAD. As long as risk appetite stays muted and optimism over the US budget situation remains fragile, the pair is likely to hold above 1.40, staying near local highs.
Intraday technical picture:
USD/CAD on the 4H chart shows a short-term upward pull-away from 1.4013, which could represent a local correction before a further decline toward the 1.3924 target.
Brent crude oil prices remained steady on Tuesday, as oversupply concerns were balanced by uncertainty over the impact of the latest US sanctions on Russia’s oil sector.
Possible technical scenarios:
Brent on the daily chart continues to consolidate within a sideways range between 63.23 and 65.02 for the third consecutive week. After rebounding from the support area, the price still has room to move toward the upper boundary of the range, where, in the absence of new volatility drivers, sideways trading is likely to continue.
Fundamental drivers of volatility:
Markets are continuing to evaluate the potential effects of US sanctions on crude oil and refined product supplies. Lukoil reportedly declared force majeure at one of its fields in Iraq. This serves as one of the most visible consequences of the restrictions imposed by Washington last month. Analysts note that export restrictions on refined products are supporting oil product prices: diesel refining margins in Europe have risen to a 21-month high of around $31 per barrel, while gasoline profitability has reached an 18-month high near $21
However, rising output from OPEC+ is preventing further gains in the market. Earlier this month, the group agreed to raise production in December by 137,000 barrels per day, while pausing any additional increases in the first quarter of next year.
Amid these developments, a slight bearish undertone is emerging — the volume of oil stored on tankers in Asian waters has doubled in recent weeks, signaling oversupply amid weak demand. Combined, these factors are keeping Brent prices confined to a narrow trading range.
Intraday technical picture:
The situation on the 4H chart suggests that Brent shows potential for recovery within the 63.23–65.02 corridor. However, given the recent three-week lows, a downward reversal could occur before the price reaches 65.02.
Login in Personal Account
11