Daily Forex Pulse — August 11, 2026

FX OVERVIEW

FX is being driven by a tug-of-war between safe-haven dollar demand from escalating US-Iran tensions and a repricing toward easier Fed policy after weak US labor data. Higher oil prices and the risk of a prolonged Strait of Hormuz disruption are particularly damaging for the euro and high-beta currencies, while expectations of eventual BoJ tightening are strengthening the yen. US CPI is the principal near-term catalyst, with volatility risks elevated after a period of unusually low market hedging.

MAJOR PAIRS

EURUSD — EURUSD remains range-bound between 1.1515 and 1.1580, with resistance reinforced by the 100-day SMA at 1.1567 and the 50-day EMA near 1.1550. The euro faces a deteriorating macro backdrop as Brent approaches $87, European gas prices rise more than 9%, and the Strait of Hormuz remains at risk; sustained escalation would favor a break below 1.1500, despite increased ECB hike expectations and a longer-term structural dollar-bearish thesis.

GBPUSD — GBPUSD retains a fragile bullish bias after weak US payrolls and large downward revisions shifted markets toward a less hawkish Fed. Support sits at 1.3437–1.3455, with 1.3500 holding; a clear break above 1.3550 would target 1.3600, particularly if UK Q2 GDP exceeds the 0.4% growth expectation, while sticky US CPI would threaten a retreat toward 1.3400.

USDJPY — USDJPY is under structural downside pressure as markets increasingly price a BoJ hike by year-end and assign a 50% probability to a September move. Narrowing US-Japan rate differentials and renewed intervention concerns favor yen strength; any confirmation of BoJ tightening would likely accelerate the decline in USDJPY.

AUDUSD — AUDUSD has drifted lower after RBA Governor Bullock offered cautious, data-dependent guidance without endorsing immediate cuts. The lack of forward guidance has reduced confidence in aggressive Australian easing but still leaves the market biased toward a more dovish RBA path, favoring gradual downside against a resilient dollar.

NZDUSD — NZDUSD is extending a second day of losses as geopolitical risk supports the safe-haven dollar and oil prices rise. The pair is holding near support at 0.5850, with the 200-day SMA and trend support around 0.5825; a break below 0.5760 would confirm a broader bearish reversal, while resistance remains at 0.5916 and 0.6000.

USDCHF — USDCHF is holding above the 50-day SMA at 0.8067 and trading near 0.8113, but the 21-day SMA at 0.8112 is limiting immediate upside and momentum is fading. A strong US CPI print would open a move toward 0.8150 and 0.8200; a break below 0.8067 would expose 0.8000 and the 100-day SMA near 0.7968.

EURGBP — EURGBP has broken below its ascending channel as Middle East tensions and higher energy prices intensify downside risks for Eurozone growth. Bearish RSI and MACD signals favor a move toward 0.8510, with 0.8550 now acting as the key psychological hurdle.

USDCNY — The yuan remains firm on a broader basis, reaching its strongest level in more than three years, but the PBOC is limiting the pace of appreciation through controlled fixing. The 6.7900 fix, well above the Reuters estimate of 6.7497, signals policy restraint and raises two-way volatility risk; resistance lies near 6.7540–6.7630, with support around 6.74–6.72 in offshore trading references.

USDIDR — USDIDR has fallen to a near two-month low as a clearer leadership transition at Bank Indonesia removes a major uncertainty premium and broader dollar weakness supports the rupiah. The confirmed downtrend favors further downside toward 17,680–17,580, although US CPI and renewed oil-price shocks remain material reversal risks.

CENTRAL BANK WATCH

  • RBA: Governor Bullock delivered a cautious, non-committal message and emphasized the need for more inflation and labor-market data. The speech did not signal immediate cuts but reinforced expectations of a dovish, gradual easing trajectory, weighing on AUD.
  • BoJ: Markets now see a rate hike by year-end as highly probable, with roughly a 50% chance of a September move. This represents a structural shift away from ultra-loose policy and is narrowing the US-Japan yield advantage.
  • Fed: Weak July payrolls and 103K of downward prior-month revisions have materially reduced confidence in US labor-market resilience. Fed funds futures now price a 50% chance of a September hold, up from 30.4% a month earlier, but hawkish commentary and the pending CPI release keep the dollar highly sensitive to inflation data.
  • PBOC: The central rate fix at 6.7900 versus a 6.7497 market estimate indicates continued management of yuan appreciation and a potentially less predictable fixing regime.
  • ECB and BoE expectations: Markets price a 90% probability of an ECB hike in September, while stronger-than-expected UK GDP would reinforce expectations for a more hawkish BoE stance.

MACRO DRIVERS

  • Geopolitical risk is the dominant cross-asset driver. The potential closure of the Strait of Hormuz, collapsing Iranian crude exports, and attacks around the Red Sea are pushing Brent toward $87 and raising the risk of a move above $100.
  • The energy shock is asymmetric. Europe faces higher gas costs, falling storage levels, and weaker growth prospects, creating a negative EUR bias even as ECB hike expectations rise.
  • US rate expectations have shifted dovish after weak labor data, undermining the dollar’s medium-term support, but safe-haven flows and hawkish Fed rhetoric are preserving near-term USD resilience.
  • Asia-Pacific FX performance is diverging. The yuan and rupiah benefit from managed policy support and reduced domestic uncertainty, while AUD and NZD remain vulnerable to risk aversion, commodity volatility, and a stronger dollar.

POSITIONING IDEAS

  • Bullish

    • Short USDJPY / long JPY: Position for a BoJ tightening cycle and further narrowing of US-Japan rate differentials. A September hike confirmation would be the key upside catalyst for the yen.
    • Long GBPUSD: Maintain a tactical long bias above 1.3437–1.3455, with a break above 1.3550 targeting 1.3600 if UK Q2 GDP beats 0.4% and US CPI is benign.
    • Short USDIDR: Bank Indonesia leadership clarity and a confirmed technical downtrend support rupiah appreciation toward 17,680–17,580.

  • Bearish

    • Short EURUSD: Hormuz-related energy inflation and Eurozone growth risk favor euro underperformance; a sustained break below 1.1500 would validate the bearish setup.
    • Short EURGBP: The channel break and bearish momentum indicators support a move toward 0.8510 as geopolitical risk disproportionately damages the euro.
    • Short NZDUSD: Rising safe-haven demand and weakening momentum favor a break below 0.5825, with 0.5760 the key trend-reversal threshold.
    • Short AUDUSD: Bullock’s cautious guidance and a less supportive RBA trajectory favor gradual downside, particularly if US CPI reinforces dollar strength.

This content is for informational purposes only and does not constitute financial, investment, or trading advice. Always consult a qualified financial professional before making any investment decisions.