US Dollar Index

On Wednesday, the US Dollar Index retreated to 102.10 after the Federal Reserve kept interest rates unchanged, as expected. Subtle adjustments to the policy statement were interpreted as a signal of a slightly more dovish stance. The Federal Open Market Committee (FOMC) voted 10–2 to maintain the federal funds rate in the 3.75%–4.00% range. Governors Lisa Cook and Cleveland Fed President Beth Hammack dissented, advocating for a 25-basis-point rate hike. However, policymakers did not explicitly state whether rates would be raised again in December, emphasizing instead that future decisions would be data-dependent, with a continued commitment to returning inflation to the 2% target. In the post-meeting press conference, Fed Chair Kevin Warsh announced that while the FOMC will continue to hold eight meetings per year, the number of interest-rate-setting meetings is planned to be reduced to seven in 2027 and further to six in 2028. This announcement comes less than a week before the midterm elections in November, amid widespread public dissatisfaction with the economy.

On the daily chart, the US Dollar Index maintains a constructive bullish bias, as the price remains above the median line of the Bollinger Bands (102.06) and firmly above the rising 9-day simple moving average (101.95). While further short-term upside appears somewhat constrained by the upper Bollinger Band at 102.61, the 14-period Relative Strength Index (RSI) is hovering near 64—suggesting that momentum remains tilted toward the upside rather than indicating exhaustion from overbought conditions. On the upside, a clear break above the upper Bollinger Band at 102.61 would pave the way for further gains toward the previous high of 102.94. On the downside, initial support lies at the 9-day simple moving average (101.95), followed by the lower Bollinger Band near 101.51, with stronger support for any deeper pullback expected near the 101.00 psychological level.

Consider shorting the US Dollar (USD) at 102.20 today, with a stop-loss at 102.30 and targets at 101.80 and 101.70.

AUD/USD

On Wednesday, the AUD/USD pair attracted buying interest for the second consecutive day, climbing to its highest level since September 23—near the 0.7060–0.7055 zone—following the release of robust Australian consumer inflation data during the Asian session. The spot price appears to have confirmed a breakout above the key resistance level of the 100-day simple moving average (SMA) at 0.7033; however, bulls may refrain from aggressive positioning, opting instead to await the outcome of the two-day FOMC meeting. The Australian Bureau of Statistics reported that the headline Consumer Price Index (CPI) rose by 0.8% in September, exceeding both the previous month’s 0.4% increase and the market consensus of 0.7%. Furthermore, the annual trimmed-mean inflation remains above the Reserve Bank of Australia’s (RBA) 2–3% target range, reinforcing expectations for an interest rate hike in November—a factor that has provided moderate support to the Australian Dollar. Meanwhile, the US Dollar has climbed to a two-week high, as the market increasingly anticipates that the Federal Reserve will raise borrowing costs again before the end of the year, driven by inflationary risks stemming from elevated oil prices. Additionally, persistent geopolitical uncertainty has bolstered the safe-haven US Dollar for the fourth straight day, capping the upside potential for the AUD/USD pair.

On the daily chart, the AUD/USD pair is hovering just above the 100-day SMA at 0.7033, while facing pressure from a dense cluster of Fibonacci retracement levels overhead. The rebound from recent lows is losing momentum, as the price remains below the 50% retracement level at 0.7066 and the 61.8% retracement level at 0.7106. Despite the support provided by the nearby moving average, the overall tone remains neutral to slightly bearish. On the downside, initial support lies at the psychological level of 0.7000, a zone further reinforced by the 23.6% Fibonacci retracement level at 0.6975. A breach of this dense support area would open the way for a test of the structural low near 0.6893. To the upside, watch for initial resistance at 0.7056 (the 200-day simple moving average) and the 50% Fibonacci retracement level at 0.7066; a breakout above these would target the 61.8% Fibonacci retracement level at 0.7106.

For today, consider going long on the AUD at 0.7040, with a stop-loss at 0.7030 and targets at 0.7080 and 0.7090.

GBP/USD

During Wednesday’s Asian trading session, the GBP/USD pair extended its decline toward the 1.3300 level. Market sentiment remains cautious ahead of the UK budget announcement and the Federal Reserve’s interest rate decision, weighing on the pound against the US dollar. UK Chancellor John Healey is set to unveil his first budget later today, facing mounting pressure to introduce measures that alleviate the cost-of-living burden on households and provide support to businesses. While it is difficult to remain insulated in an environment of rising global bond yields, the UK appears to be in a relatively better position compared to other major developed markets. The Federal Reserve is widely expected to keep its policy rate target range unchanged at 3.75%–4.0%, while potentially offering hints regarding possible action in December. Traders will be closely monitoring remarks from Fed official Kevin Warsh for further clues on the US interest rate outlook. Any hawkish commentary from Fed officials could bolster the US dollar and exert downward pressure on this major currency pair. Market pricing indicates a 92.8% probability that the Federal Reserve will hold rates steady at its October policy meeting, with an 84.4% chance of a rate hike in December. On the daily chart, GBP/USD remains below the 100-day Simple Moving Average (SMA) at 1.3387. Despite a modest rebound from recent lows, the overall tone remains slightly bearish. The price is consolidating just above the middle line of the Bollinger Bands at 1.3288, suggesting potential buying support nearby. Meanwhile, the Relative Strength Index (RSI, 14) sits at approximately 47—below the 50-level—indicating that bullish momentum remains limited. On the upside, initial resistance lies at the 100-day SMA (1.3387), followed by the upper Bollinger Band near 1.3416; should the pair climb further, sellers may look to regain control in this area. On the downside, immediate support is found at the middle Bollinger Band (1.3288), followed by the psychological support level near 1.3200. A break below this latter level would likely reinforce the prevailing bearish bias.

For today, consider going long on GBP at 1.3318; stop-loss: 1.3310; targets: 1.3360, 1.3350.

USD/JPY

On Wednesday, the Japanese yen fell toward 158 against the US dollar, erasing most of the safe-haven gains seen last week as optimism regarding the outlook for artificial intelligence (AI) returned. South Korean chipmaker SK Hynix reported strong third-quarter results and announced plans to increase shareholder returns—bolstered by AI-driven profits—which further boosted the outlook for the sector. Meanwhile, investors are preparing for the Bank of Japan’s policy meeting this week, where interest rates are widely expected to remain unchanged. However, given persistent inflationary pressures, policymakers might signal a potential rate hike in December. Recent data shows that a key gauge of service-sector inflation in Japan rose 3.7% year-on-year in September—the highest level since June 2024—as costs for labor, transportation, and fuel remain elevated. Investors are also monitoring monetary policy decisions from other major central banks this week, which could influence the trajectory of the Japanese yen.

The USD/JPY pair is currently trading near 157.70, with an intraday range of approximately 157.40 to 157.90—a slight recovery from the previous day's close. The price is hovering around 157.85, aligning with the middle line of the Bollinger Bands (157.90). With the upper band at 158.87 and the lower band at 157.04, the current price is positioned just below the middle line. The MACD indicator shows a DIFF of -0.013 and a DEA of 0.085, with the MACD histogram at -0.196, suggesting weak short-term momentum. This setup indicates that the price is consolidating near a medium-term moving average, with relatively contained volatility. Market expectations for the Bank of Japan’s late-October meeting remain unchanged; with the policy rate currently at 1.25%, most observers anticipate no change, shifting the focus toward the central bank's subsequent messaging. On the upside, the 158.00 level (a round number) is a key area to watch, with a potential move toward the recent high near 159.07. On the downside, the 23.6% Fibonacci retracement level at 157.63 provides initial support, followed by a more significant support zone between the 38.2% Fibonacci retracement level (156.74) and the 50.0% level (156.02).

For today, one might consider shorting the USD at 158.00, with a stop-loss at 158.15 and targets at 157.30 and 157.40.

EUR/USD

During Wednesday’s early Asian session, the EUR/USD pair held steady near 1.1150. Traders appear to be adopting a "wait-and-see" approach, avoiding large positions ahead of the U.S. Federal Reserve’s interest rate decision, which is due later on Wednesday. Market focus will subsequently shift to the European Central Bank’s policy meeting later on Thursday. Traders will also be closely monitoring any hints regarding the outlook from Federal Reserve official Kevin Warsh. According to the CME FedWatch Tool, the market is pricing in a 92.8% probability that the U.S. central bank will keep interest rates unchanged at its October policy meeting, with an 84.4% chance of a rate hike in December. Should rates remain steady, the risks for the U.S. dollar are skewed to the downside: while a hawkish tone might be neutral, a dovish stance—or simply maintaining the status quo—could lead to a significant weakening of the dollar. Across the Atlantic, the euro is on track to be the worst-performing developed-market currency in October, having fallen 1.70% against the U.S. dollar; this may exert continued selling pressure on the common currency in the near term.

On the daily chart, EUR/USD remains under clear bearish pressure. The price is trading below the 1.1203 midline of the Bollinger Band and well beneath the 34-day moving average at 1.1302—both of which serve as strong overhead resistance. The price is also hugging the lower Bollinger Band at 1.1126, underscoring a persistent downward bias. Meanwhile, the Relative Strength Index (RSI) sits at 29.87, hovering near the oversold zone; this suggests that while bears remain in control, the downward trend could see intermittent corrective rebounds. On the upside, initial resistance lies at the 1.1203 Bollinger midline, followed by the lower Bollinger Band at 1.1281, with more significant resistance located near the 34-day moving average at 1.1302. As current indicators provide no meaningful support levels below the current price, any further weakness risks pushing the pair toward a new low at 1.1100; a break below that level would point toward the 1.1000 mark. Consider going long on the Euro at 1.1145 today; stop-loss: 1.1135; targets: 1.1180, 1.1170.

WTI Crude Oil

During Wednesday’s Asian session, WTI crude oil extended its rebound, climbing back above the $100.00 mark and pushing further toward $101.20, nearing the immediate resistance level of $101.50. Exit polls from the Israeli general election indicate a tight race between Benjamin Netanyahu and opposition leader Gadi Eisenkot, with neither side securing a clear majority. Meanwhile, Iran’s Supreme Leader Ali Khamenei has called for an end to the "neither war nor peace" status quo, and Yemen’s Houthi rebels have claimed a ballistic missile attack on Saudi Arabia’s largest oil refinery at Ras Tanura—developments that continue to fuel a geopolitical risk premium. On the support side, three separate factors have converged, shifting the narrative from "cooling down" back to "heating up." At the same time, the timing is critical: the upcoming midterm elections act as a constraint on executive decision-making—incentivizing price suppression ahead of the vote while keeping options open for afterward—which suggests that oil prices are more likely to trade within a range rather than stage a one-sided rally leading up to next week. Investors should not view this single-day rebound in isolation, but rather evaluate it within the broader transmission chain of "geopolitics—supply—inflation—interest rates." Only if a verifiable supply disruption occurs will this risk premium have the foundation to evolve into a sustained trend.

On the daily chart, WTI is trading at $101.20, having snapped a two-day losing streak. The price has reclaimed the $100 psychological level and is gradually approaching a cluster of short-term moving averages. The overall outlook leans neutral-to-bullish, though momentum has yet to strengthen significantly. The $100 level has shifted from resistance to immediate support, signaling buying interest above this psychological threshold—a classic setup of "building momentum in anticipation of a breakout." On the upside, resistance levels to watch are $101.50, $102.50, and $103.80. On the downside, the initial support level is the $100.00 psychological mark; should the price break below $99.80 on significant volume, it may seek further support at $98.50. The MACD histogram is hovering just above the zero line, and the MACD lines are nearing a bullish crossover—suggesting a potential shift in momentum from bearish to bullish, though this has yet to be confirmed. Currently, the price is fluctuating within a narrow range between $100.00 and $101.50.

For today, one might consider going long on crude oil at $101.15, with a stop-loss at $101.00 and targets at $102.50 and $103.00.

Spot Gold

During early Asian trading on Wednesday, spot gold was trading near $4,060 per ounce. Softer oil prices have eased inflation concerns and may temper the Federal Reserve’s hawkish stance, providing support for gold. On Tuesday, spot gold rose by approximately 1% to around $4,060 per ounce, driven primarily by the decline in oil prices. While the pullback in oil has alleviated some inflationary fears and softened expectations for a highly hawkish Fed, geopolitical risks in the Middle East persist, keeping oil prices at elevated levels. The market is focused on this week’s Federal Reserve meeting; while interest rates are widely expected to remain unchanged, the probability of a rate hike in December remains high. Thursday’s PCE (Personal Consumption Expenditures) data will be a key point to watch. Meanwhile, strong U.S. business equipment spending, a strengthening dollar, and a high-interest-rate environment are exerting downward pressure on gold, creating a complex, mixed outlook in the short term. The market is currently at a critical juncture, influenced by a confluence of competing factors. Falling oil prices have eased inflation concerns and may temper the Federal Reserve’s hawkish stance, providing support for gold. However, oil prices remain near multi-month highs, with supply risks persisting due to shipping concerns in the Middle East and Houthi attacks on Saudi Arabia. Meanwhile, while the Federal Reserve is widely expected to hold rates steady this week, the probability of a December rate hike remains high; a rebound in the U.S. dollar and elevated Treasury yields continue to weigh on non-yielding gold.

On the daily chart, gold maintains a short-term bearish bias, trading below its 50-day, 100-day, and 200-day simple moving averages (SMAs), which keeps sellers in control. The Relative Strength Index (RSI) sits at 38, indicating weak buying momentum, while the Moving Average Convergence Divergence (MACD) remains in negative territory, suggesting that downward pressure persists. To the upside, initial resistance is found near the 9-day SMA at $4,079, followed by the $4,100 psychological level. A stronger rebound would bring the $4,120 level—aligned with the 20-day SMA—into focus. On the downside, the $4,000–$3,950 range serves as immediate support; a break below this zone could open the door for a deeper pullback. As long as the price remains below the cluster of daily moving averages, any attempted rally is likely to face resistance.

For today, consider going long on gold at $4,064, with a stop-loss at $4,060 and targets at $4,100 and $4,095.