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USD/CHF's extended rebound last week suggests that corrective pattern from 0.7828 is not complete. Instead, it's now extending with a third leg. Initial bias stays on the upside this week for 0.8075 resistance first. Break there will target 100% projection of 0.7828 to 0.8075 from 0.7872 at 0.8119. On the downside, below 0.8008 minor support will turn intraday bias neutral.

In the bigger picture, long term down trend from 1.0342 (2017 high) is still in progress. Next target is 100% projection of 1.0146 (2022 high) to 0.8332 from 0.9200 at 0.7382. In any case, outlook will stay bearish as long as 0.8332 support turned resistance holds (2023 low).

In the long term picture, price action from 0.7065 (2011 low) are seen as a corrective pattern to the multi-decade down trend from 1.8305 (2000 high). It's uncertain if the fall from 1.0342 is the second leg of the pattern, or resumption of the downtrend. But in either case, outlook will stay bearish as long as 0.8756 support turned resistance holds (2021 low). Retest of 0.7065 should be seen next.

AUD/USD rebounded further to 0.6616 last week but retreated sharply since then. Initial bias remains neutral this week first. On the upside, break of 0.6616 will resume the rise from 0.6439 to retest 0.6706 high. However, break of 0.6524 will turn bias to the downside for 0.6439 and possibly below, to extend the corrective pattern from 0.6706 with another falling leg.

In the bigger picture, there is no clear sign that down trend from 0.8006 (2021 high) has completed. Rebound from 0.5913 is seen as a corrective move. Outlook will remain bearish as long as 38.2% retracement of 0.8006 to 0.5913 at 0.6713 holds. Nevertheless, considering bullish convergence condition in W MACD, sustained break of 0.6713 will be a strong sign of bullish trend reversal, and pave the way to 0.6941 structural resistance for confirmation.

In the long term picture, fall from 0.8006 is seen as the second leg of the corrective pattern from 0.5506 long term bottom (2020 low). Hence, in case of deeper decline, strong support should emerge above 0.5506 to contain downside to bring reversal. On the upside, firm break of 0.6941 will argue that the third leg has already started back to 0.8006.

USD/CAD initially dived to 1.3886 last week but rebounded strongly from there. Strong support was seen from 55 D EMA (now at 1.3914). The pair is also staying well inside near term rising channel. Overall development suggests that rise from 1.3538 is still in progress. Initial bias stays on the upside for 1.4078 this week. Break there will target 61.8% projection of 1.3725 to 1.4078 from 1.3886 at 1.4104, and then 100% projection at 1.4239. For now, risk will remain on the upside as long as 1.3887 support holds, in case of retreat.

In the bigger picture, price actions from 1.4791 medium term top is likely just unfolding as a correction to up trend from 1.2005 (2021 low). Based on current momentum, rise from 1.3538 is the second leg, and a third leg should follow before up trend resumption. That is, range trading is set to extend for the medium term. For now, this will remain the favored case as long as 1.3725 support holds. However, firm break of 1.3725 will revive the case that fall from 1.4791 is indeed a larger scale correction.

In the long term picture, 55 M EMA (now at 1.3525) remains intact. Thus, up trend from 0.90567 (2007 low) should still be in progress. However, considering bearish divergence condition M MACD, sustained trading below 55 M EMA will argue that the up trend has completed with five waves up to 1.4791, and turn medium term outlook bearish for correction.

Despite dipping to 200.54 last week, GBP/JPY quickly recovered. Initial bias remains neutral first. Current development suggests that price action from 205.30 is merely a corrective move, and larger rally is still in progress. On the upside, break of 204.22 will suggest that rise from 184.35 is resuming through 205.30 towards 208.09 high. However, break of 200.54 will extend the fall from 205.30 to 197.47 key structural support.

In the bigger picture, price actions from 208.09 (2024 high) are seen as a corrective pattern which might have completed at 184.35. Firm break of 208.09 high will resume the up trend from 123.94 (2020 low). Next target is 61.8% projection of 148.93 to 208.09 from 184.35 at 220.90. However, decisive break of 197.47 support will dampen this view and extend the corrective pattern with another fall.

In the long term picture, there is no sign that the long term up trend from 122.75 (2016 low) has concluded. But firm break of 208.09 is needed to confirm resumption. Otherwise, more medium term range trading could still be seen.

EUR/JPY's up trend resumed last week but retreated after hitting 178.80. Initial bias is turned neutral this week for consolidations. Downside of pullback should be contained above 174.80 support. On the upside, break of 178.80 will extend the up trend to 61.8% projection of 161.06 to 173.87 from 172.24 at 180.15 next.

In the bigger picture, up trend from 114.42 (2020 low) is in progress and should target 61.8% projection of 124.37 to 175.41 from 154.77 at 186.31. Firm break of 172.24 support will suggests that it has turned into consolidations again. But still, outlook will continue to stay bullish as long as 55 W EMA (now at 167.87) holds, even in case of deep pullback.

In the long term picture, up trend from 94.11 (2021 low) is in progress. Next target is 138.2% projection of 94.11 to 149.76 (2014 high) from 114.42 (2020 low) at 191.32. This will remain the favored case as long as 154.77 support holds.

EUR/GBP's rise from 0.8221 resumed last week and hit as high as 0.8817. But with a temporary top formed, initial bias remains neutral this week for consolidations. Further rise is expected as long as 0.8750 resistance turned above holds. Above 0.8817 will target 0.8867 fibonacci level. Firm break there will carry larger bullish implications. Nevertheless, sustained break of 0.8750 will turn bias back to the downside for 0.8654 support instead.

In the bigger picture, rise from 0.8221 medium term bottom is still seen as a corrective move. Upside should be limited by 61.8% retracement of 0.9267 to 0.8221 at 0.8867. Firm break of 0.8654 support will be the first sign that this corrective bounce has completed. However, decisive break of 0.8867 will suggest that EUR/GBP is already reversing whole decline from 0.9267 (2022 high).

In the long term picture, price action from 0.9499 (2020 high) is seen as part of the long term range pattern from 0.9799 (2008 high). Range trading should continue between 0.8201 and 0.9499, until there is clear signal of imminent breakout.

EUR/AUD's extended decline last week dampened the original bullish view, and suggests that corrective pattern from 1.8554 is extending with a thirds. Initial bias stays neutral this week first. Firm break of 1.7569 support will solidify this case and target 1.7254 support next. For now, risk will remain on the downside as long as 1.7813 minor resistance holds.

In the bigger picture, price actions from 1.8554 medium term top are seen as a corrective pattern. Sustained break of 55 W EMA (now at 1.7399) will suggest that it's correcting the whole rally from 1.4281 (2022 low). In this case, deeper decline would be seen to 38.2% retracement of 1.4281 to 1.8554 at 1.6922. Nevertheless, strong rebound form 55 W EMA will likely bring resumption of the up trend sooner.

In the longer term picture, rise from 1.4281 is seen as the second leg of the pattern from 1.9799 (2020 high), which is part of the pattern from 2.1127 (2008 high). As long as 55 M EMA (now at 1.6501) holds, this second leg could still extend higher.

EUR/CHF recovered last week but outlook is unchanged. Price action from 0.9208 is seen as a corrective pattern, and upside should be limited by 0.9311 support turned resistance. On the downside, below 0.9236 minor support will bring retest of 0.9204/8 support zone. Firm break there will resume larger down trend to 61.8% projection of 0.9660 to 0.9218 from 0.9452 at 0.9179. However, sustained break of 0.9311 will bring stronger rebound back to 0.9371 resistance instead.

In the bigger picture, outlook remains bearish with EUR/CHF staying well inside long term falling channel after multiple rejection by 55 W EMA (now at 0.9386). Firm break of 0.9204 will resume the whole down trend from 1.2004 (2018 high). Next target is 61.8% projection of 1.1149 to 0.9407 from 0.9928 at 0.8851. Break of 0.9452 resistance is needed to be the first sign of medium term bottoming.

In the long term picture, overall long term down trend is still in progress in EUR/CHF. Outlook will continue to stay bearish as long as 55 M EMA (now at 0.9820) holds.

Monday, Nov 3, 2025

Tuesday, Nov 4, 2025

Wednesday, Nov 5, 2025

Thursday, Nov 6, 2025

Friday, Nov 7, 2025

Week in review: Fed Delivers Hawkish Surprise

The week draws to a close on a positive note after starting out with a host of risks to consider. However, one by one those risks were navigated and a positive outlook has emerged, for now.

US-China have agreed on some key points of a potential trade deal averting what markets feared may spiral into a new cold war of sorts. The meeting between Trump-Xi Jinping did deliver an outcome and one which was cheered by market participants.

The question now is, will the deal hold and be built upon or will we get another flare up in a few weeks/months?

Next up we had the Federal Reserve meeting which caught market participants by surprise. Federal Reserve Chair Jerome Powell remains defiant and struck a rather hawkish tone to accompany the expected 25 bps rate cut. Stephen Miran of course voted for a 50 bps cut while one Fed member voted for no rate cut at all.

Another sign of the conflicting ideas between policymakers and challenges for the Fed moving forward.

Lastly we can talk about earnings season where ‘magnificent 7’ companies all provided positive earnings reports and outlooks which has kept the AI boom, well booming.

On Friday, Amazon's shares jumped by 10.6% to a new record high after the online retailer predicted higher quarterly sales than analysts expected, boosted by its cloud division reporting its fastest revenue growth in almost three years.

Meanwhile, Apple's forecast for iPhone sales in the holiday quarter was better than Wall Street predicted, but its CEO, Tim Cook, warned about ongoing supply limitations; the company's stock remained flat.

Finally, Nvidia rose 1.6% after its CEO, Jensen Huang, expressed hope that the company's most advanced Blackwell chips could be sold in China, building on the momentum that made Nvidia the first publicly listed company to exceed $5 trillion in market value earlier in the week

How has the US Dollar and FX Performed?

The US Dollar benefitted from the hawkish outlook by the Federal Reserve which led to the USD rising to a two-month high.

Looking at Friday, the Japanese yen is heading for its worst monthly loss since July against the US Dollar. This happened because the Bank of Japan disappointed traders who were hoping for clearer hints about future interest rate increases, while the US Federal Reserve also lowered expectations for a rate cut in December.

As the yen fell, the US Dollar Index rose 0.35% and is set for its best month since July, with a 2% gain. Meanwhile, the Euro dropped 0.37% after the European Central Bank kept its interest rates steady and stated that policy was in a "good place." The Euro has now lost 1.8% this month due to the Dollar's broad strength.

Finally, the British pound fell to its lowest point since April against the Dollar and hit its weakest against the Euro since May 2023, due to increasing political pressure on British Finance Minister Rachel Reeves.

The Week Ahead

The week ahead will not be as busy as the one just concluded but there are still some high impact data releases and geopolitical risk.

Beyond the data, markets will keep a close eye on Russia-Ukraine as well the a potential move by the US in Venezuela. President Trump on Friday pushed back on reports that he had given the greenlight for the US to conduct strikes on Venezuelan soil.

If such a move does materialize or if the situation escalates, we could see a rise in risk premium once more just as it appeared to be subsiding.

US earnings will also be key as more companies are scheduled to report next week.

Asia Pacific Markets

The Reserve Bank of Australia (RBA) is expected to keep its interest rates unchanged on Tuesday. This is because the inflation rate for the third quarter was higher than predicted and above the central bank's 2.5% target.

This high inflation will likely be the deciding factor, outweighing the unexpected increase in the unemployment rate in September, especially since other job market indicators still show overall strength in employment.

Looking at China, the meeting between Presidents Xi and Trump last week successfully reduced the trade tensions between the two countries. Next week should be quieter in terms of major news from China.

The main economic report will be the trade data released on Friday. We predict that China's export growth will slow down to 4.0% compared to last year, and import growth will also drop slightly to 3.2%. This slower pace for both exports and imports is expected to cause China's trade surplus (how much more it exports than imports) to jump back up to $101 billion.

Lastly, we move to Japan where based on current projections, Japanese workers are expected to see their earnings and household spending increase. This suggests that consumer spending remains stable, even though inflation is high. Strong results from recent wage negotiations are likely to keep pushing wages higher, and the ongoing rally in the stock and asset markets could also encourage households to spend more.

US Government Shutdown Continues, BoE Decision and Inflation in Focus

Since the US government shutdown shows no sign of ending, we will have very little official economic data. However, the business and consumer surveys we do get are expected to confirm that the economy is slowing down. Key business reports (like the ISM indicators) suggest the economy is now growing at about 1-2%, which is decent but slower than the 2-3% growth seen recently.

Because the official jobs report is unavailable, the private ADP employment report has become extremely important. This report has shown that the private sector has cut jobs in three of the last four months, and we expect only a small gain of about 40,000 this month—a number that doesn't signal a recovery, especially after major job cuts announced by companies like Amazon and UPS.

Finally, the University of Michigan confidence index will likely confirm that consumer confidence is weak due to worries about tariff-related price hikes and job security, meaning that spending by middle and lower-income families will likely continue to lag behind that of wealthier households.

Across the pond in the UK, stronger recent data on inflation and wages has brought back the possibility that the Bank of England might cut interest rates in November, although I still believe this is unlikely. The decision could be close, potentially a 5-4 vote in favor of keeping rates unchanged, with some members possibly voting for a much larger, 0.50% cut.

I don't expect the Bank to give any strong hint about a December cut, as they will want to review the government's late-November Autumn Budget first. However, my conviction regarding a December cut is growing, which would likely be followed by two more rate cuts in 2026.

For all market-moving economic releases and events, see the MarketPulse Economic Calendar. (click to enlarge)

Chart of the Week - US Dollar Index

This week's Chart of the week is the US Dollar Index (DXY)

From a technical perspective, the DXY has broken above a key resistance level around the 99.60 handle and is trading at a two-month high.

Next up we have the key psychological 100.00 level.

US Dollar Index (DXY) Daily Chart - October 31, 2025

Source:TradingView.Com (click to enlarge)

Key Levels to Consider:

Support

• 99.60
• 98.67
• 98.14

Resistance

• 100.00
• 100.50
• 102.16