Daily Forex Pulse — November 4, 2026

FX OVERVIEW

The dominant theme is broad US dollar weakness after the Democratic midterm victory, as political uncertainty and lower Treasury yields outweighed resilient US activity. Euro and sterling also drew support from rate expectations, while weaker domestic fundamentals pressured the Australian and New Zealand dollars; geopolitical risk and oil-price swings kept commodity and safe-haven flows volatile.

MAJOR PAIRS

EURUSD — The pair recovered toward 1.1270 as dollar weakness met Eurozone inflation at 4.0% and hawkish ECB signals, including Joachim Nagel’s indication of a possible December hike. Resistance at 1.1275 is the near-term test; a break would open 1.1350, though uneven regional growth leaves the rally vulnerable.

GBPUSD — Sterling climbed above 1.3434 as markets priced an expected 25bp BoE hike, overshadowing weaker UK services PMI data and the housing outlook. A hawkish decision could extend gains toward 1.3479 and 1.3525; a dovish surprise risks reversal.

AUDUSD — The pair fell to 0.6977 despite the RBA’s hike to 4.85%, as the 6–3 vote and removal of forward guidance raised doubts about further tightening. The housing downturn and weakening consumption leave the bias bearish, with the rate advantage less persuasive if markets expect a pause.

NZDUSD — The bounce near 0.5600 looks corrective, with the pair still below the 20-period EMA at 0.5645 and domestic fundamentals weak. A break of 0.5564 would expose 0.5500; a sustained recovery needs a move back above 0.5645.

USDCHF — The pair slid to 0.8127 as safe-haven demand for the franc coincided with broad dollar selling. It has broken below the 50-day SMA at 0.8227; 0.8100 is key support, with 0.8050–0.8070 and then 0.8000 in view.

USDCAD — The pair traded near 1.3970 as lower US Treasury yields and firmer crude supported the Canadian dollar. The bias remains lower while yields stay soft and oil holds firm, but progress or failure in US–Iran talks could quickly reverse the oil-driven support.

USDJPY — Japanese officials’ warnings against disorderly yen moves are limiting the scope for further dollar gains. The pair remains constrained around its 50- and 200-day SMAs at 157.39 and 158.62; a sustained move above 158–159 risks intervention, while a break above 158.62 would otherwise improve the technical outlook.

USDCNY — The PBOC set its central rate at 6.7180, weaker than the 6.6811 market estimate, signaling some tolerance for yuan softness. The fixing points to near-term upside risk in USDCNY, although Beijing’s efforts to cool yuan momentum make the policy signal mixed.

CENTRAL BANK WATCH

  • RBA: The November hike to 4.85% passed 6–3, and the Bank removed forward guidance. Markets read the combination as a sign that the tightening cycle may be nearing a pause, especially with housing and consumption weakening.
  • BoE: Markets are pricing an upcoming 25bp hike, with attention focused on whether it is the final move or whether guidance points to further tightening. Sticky services inflation and energy costs remain central to the decision.
  • ECB: October inflation at 4.0% and hawkish signals from officials, particularly Nagel, strengthened expectations of a possible December hike. Weak growth across parts of the bloc remains the key constraint.
  • Bank of Japan: Finance Minister Katayama warned against disorderly yen moves, reinforcing the market’s perception that authorities may intervene if yen weakness accelerates.
  • PBOC: The higher-than-expected USD/CNY fixing indicates greater tolerance for yuan depreciation, while separate efforts to cool the yuan’s rally underscore Beijing’s preference for managed, two-way movement.

MACRO DRIVERS

  • US political uncertainty and lower Treasury yields are weighing on the dollar, despite reports of resilient US activity and a still-firm services sector.
  • Inflation is reviving rate support for the euro and sterling: Eurozone inflation reached 4.0%, while UK markets are focused on a likely BoE hike.
  • Domestic growth risks are undermining the AUD and NZD. Australia’s housing correction and weaker consumption challenge the RBA’s rate support; the Kiwi remains below key resistance.
  • Energy and geopolitical developments are driving uneven commodity-currency flows. Oil has supported the CAD, but shifting Middle East risk keeps that support—and the broader inflation outlook—fragile.

POSITIONING IDEAS

  • Bullish

    • Long EURUSD — supported by broad dollar weakness, elevated Eurozone inflation, and hawkish ECB signals; 1.1275 is the breakout level to watch.
    • Long GBPUSD — supported by expectations of a BoE hike, with 1.3479 and 1.3525 as near-term upside levels if the Bank validates the repricing.
    • Long CHF against USD — safe-haven demand and a break below USDCHF’s 50-day SMA support further downside, with 0.8100 the next key test.

  • Bearish

    • Short AUDUSD — the RBA’s removal of forward guidance and deteriorating housing and consumption trends outweigh the current yield advantage.
    • Short NZDUSD — the pair remains below 0.5645, with a break of 0.5564 opening the way toward 0.5500.
    • Short USDCAD — lower US yields and oil support the Canadian dollar, though the position is exposed to a reversal in crude or geopolitics.

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.